For those of you who check in periodically, take a look at the top of the page to see if there’s anything new, we’ve added two new features.
First, if you’d like e-mail notification of a new posting, scroll to the bottom right and subscribe.
Second, our most recent Twitter “tweets” and retweets are posted on the right hand side. When we only have a moment to dash something off, comments are more likely to show there than direct postings here.
{ 0 comments }
For the past couple years, Albany County Legislators have been talking about keeping a much larger share of sales tax revenue for their own purposes and reducing the share passed on to cities, towns and villages. Many of those Legislators have such a proprietary sense of it that they call it “our money,” as if they earned it or something. The County Executive, Dan McCoy still wants a bigger share. However, because they dare not cause a ruckus, it now appears that the desire of multiple legislators for higher office (including some who’ve argued for keeping a bigger share) has frozen things as they currently are … at least for this year.
Jordan Carleo-Evangelist, reports in Share shift a likely no go that it’s unlikely to happen this year.
McCoy still wants the money because once again, Albany County is anticipating a large property tax increase.
In late March, McCoy publicly floated the idea of capping the amount of sales tax revenue the county shares with its cities and towns at 2010 levels, with the county keeping any growth beyond that to help pay for unfunded state mandates that he said are all but certain to force the county to exceed the state’s property tax cap again next year.
The idea, and other variations of it, however, has been wildly unpopular with local leaders, who say they rely on the money to balance their budgets as much as the county does.
One wonders whether McCoy was willing to guarantee local officials the 2010 level so that if revenues fell, he and the County would bear the full cost of the downside.
Of course, if the County keeps a larger share, then cities, towns and villages would likely have to raise their taxes even higher. This would never have saved taxpayers anything; it would have just changed the names of the elected officials who anger voters.
But there are now so many legislators running for the State Legislature and because they don’t have to deal with the County budget until after the election, that they’ve backed off the issue. Perhaps “fled from the issue” is a better description.
While legislature Chairman Shawn Morse said the Democrats did not discuss McCoy’s cap proposal specifically, he said any move that shifts the tax burden from the county to cities and towns is little different than the unfunded state mandated programs the county is battling. “I don’t think there’s a lot of steam for that moving forward,” said Morse, a Cohoes Democrat who launched his campaign for state Senate this month attacking unfunded mandates. “I think the lawmakers have always been very concerned about just shifting the burden. That’s where I’ve been on this thing since day one. I complain about unfunded mandates, and this would be no different.”
In Morse’s case, that rings of revisionist history. Others were more candid.
Majority Leader Frank Commisso was more direct. “There was no support for it,” Commisso, who represents Albany and is running for Assembly, said of changing the distribution formula. “We have to find other ways of tightening our budget.”
But this election season will end and perhaps some of these characters will move on to other jobs. The issue, and the cumulative effect of not dealing with the underlying financial challenges will remain. So expect this issue to be back next year. And when that happens, come back here to look at all the relevant data.
Albany County distributes 40 percent of of what it receives in sales tax revenues to municipalities and that’s the figure that the Legislature has obsessed over. The figures they’ve ignored are ones that show how Albany County gets an unusually high level of sales tax revenue. So the net that remains for the County is still high. Take a look at the attached graphic which shows trend lines for Albany and comparable counties of sales tax revenues per capita after distributions to municipalities. We compared Albany to Broome, Dutchess, Erie, Monroe, Niagara, Oneida, Onondaga, and Orange Counties. These are all upstate New York metropolitan counties, each with some rural areas mixed in.
Even after distributions to cities, towns and villages, from 1998 through 2010, Albany County had the highest average per capita sales tax revenue per resident (as well as the highest year).
So even after the election, don’t restart the whining. Don’t try again to pass the burden to somebody else. Clean up your own house.
{ 0 comments }
The journalist character, Melissa Tregarthen in Justin Cartwright’s, Other People’s Money:
“I am a number,” she writes. “I am a statistic. I am a sacrifice on the altar of the free market. I have no power, except the power of words.”
This is immediately after being given the “chop,” being laid off.
{ 0 comments }
Deep in the comments following Maureen Dowd’s Dancing with Deriviatives, on the JP Morgan Chase debacle is the following comment by Diana Moses of Arlington, MA
Wasn’t there a theme in 2001: A Space Odyssey about our technological developments escaping our control (I’m thinking about HAL)? I sometimes feel that way not just about Big Banks and other huge financial institutions, but about other systems as well; not that I fear they will become people, even if corporations allegedly have, but because I think we just make things too complex and complicated for systems relying at base on human beings to run and monitor them. I see that in the less dramatic issues I encounter in systems like insurance and health care in my own life. I get the impression that systems are designed mostly with best-case scenarios in mind, and that the technology component amplifies the damage when there turn out to be unexpected glitches in the systems when they interface with real life and flawed human beings in their implementation. The complexity factor has been referenced as a reason we don’t yet understand what happened in this case. This makes the case come across to me as a modern iteration of an ancient pattern of hubris in human affairs.
The reference to HAL is perfect. We need to unplug him.
{ 0 comments }
Today’s news that JP Morgan Chase had incurred a $2 billion trading loss reminds us again of the risks to the rest of us of organizations that are not only too big to fail, but too big and complex to effectively manage.
Simon Johnson, author, with James Kwak, of White House Burning, The Founding Fathers, Our National Debt, and Why it Matters to You puts it in simple terms:
The lessons from JP Morgan’s losses are simple. Such banks have become too large and complex for management to control what is going on. The breakdown in internal governance is profound. The breakdown in external corporate governance is also complete — in any other industry, when faced with large losses incurred in such a haphazard way and under his direct personal supervision, the CEO would resign. No doubt Jamie Dimon will remain in place.
Let’s be explicit about what “external corporate governance” means: regulation. However, conventional regulation will not protect either the economy or society because regulators have even less information and what information they do have is even more delayed than in the organizations they presume to regulate.
At the same time, let’s not obsess about replacing the CEO. The problem of “too big to manage” (TBTM) is that no one could be an effective CEO.
The only effective solution is to reduce the size and perhaps the complexity of organizations that are so interlinked with the economy and society that the economy and society cannot afford to let them fail.
See Johnson’s timely op-ed in the New York Times from just yesterday on the need to reduce the size of the four largest banks.
Lest those organizational systems spin out of control, for them to control themselves, the capability of information structures within those organizational systems – not just information technology – must grow as quickly, if not more quickly than the capability, size and complexity of organizational systems themselves. The bigger, the more complex, the more capable an organization is, the more its information structures must be bigger and capable.
While information capabilities have grown to an extraordinary degree over recent decades, they have still not kept up with the growth in the size and complexity of the largest financial institutions.
When too big to manage meets too big to fail, disaster – or another bailout – is inevitable.
Update 5/11/12 at 9:38 AM
Here’s the Bloomberg story on what’s going on at JP Morgan Chase.
Update 5/11/2012 at 9:56 AM
Also read Heidi Moore’s explanation of what happened at JPM. It’s in the form of a Q&A, it names names, and has some gory details.
Update: 5/11/2012 at 10:37 AM
Suzy Khimm at the Washington Post was on this story a month ago in Who is Wall Street’s Voldemort, and why is he so feared?.
{ 0 comments }
It shouldn’t be too hard to figure out where we’ll come down in this fight. With a tagline, “use the damn data,” one should probably assume that we think it’s not only important, it’s essential that we collect valid, reliable data. And it shouldn’t be a surprise that we believe that for social and economic data, the best organizations to gather and manage such data are government agencies.
Evidently, voting to eliminate the Census Bureau’s American Community Survey (ACS), there are many Republican members of the House of Representatives that believe otherwise. This is part of a larger pattern of attacks on measuring the American economy and society.
Do public agencies that collect data, share enough of it with the public in forms that can be understood, much less learned from. They do not. But the solution to that is another of our taglines, make the public’s data public. But this is not generally an issue regarding the Census Bureau and not an issue regarding the ACS.
On a related matter, here’s Kevin Drum on the ongoing debate at the New York Times between Krugman and David Brooks in The War Between Data and Storytelling. Drum has a point that, but they need not be mutually exclusive. Nevertheless, one can learn from data without a story, but a story without data is just one data point and probably a biased one at that.
{ 0 comments }
We hear a lot in New York about how taxes cause people to emigrate, either directly or indirectly because businesses leave. This is particularly a concern when younger people leave.
So it’s interesting to see that New Hampshire, a notoriously low tax state (neither a sales nor an income tax), is also suffering from an exodus of youth.
We’ve been doing some reading on the economic advantages of population density and will write when it’s ripe. But given our personal straddle between New York and New Hampshire, this was interesting.
{ 0 comments }
Unhappiness is a negative cash flow. Even worse is not knowing what your cash position is.
For the past year, I’ve been submitting Freedom of Information (FOIL) requests to Albany County, getting their cash position each week. I’ve been using the data to prototype some displays of public data. It’s not cash flow, but rather weekly snapshots. Actual cash flow would be better but the County’s organizational and information systems are inadequate to track, much less project or display cash flow.
You’ll find links to the most recent test displays here. Once you get to the data display, there are extra tabs that you can click and explore. This is a limited subset of the displays that we’ve developed and begun testing. You’ll see that the data go back years and you’ll also see how the County’s cash position declined during the “Great Recession.”
The most recent FOIL request hit a wall and the explanation was that the County has been “transitioning to a different banking institution.” So no data has been available since mid-January of this year. That’s over three months that Albany County has not had a comprehensive picture of its cash position. Or at least it’s been three months since those responsible for managing the cash have had it. And the gap began right after the new County Executive, Dan McCoy, took over.
All of my FOIL requests have gone through the County Clerk, who is the Freedom of Information Officer, to the Commissioner of Management & Budget, who is the County Treasurer.
It seems to me that with the disruption of a move from one bank to another, that it’s all the more important to know exactly what your overall position is and to know precisely where your cash is. It takes extra work, but given the extra risks associated with a transition, doing the extra work is all the more important.
I can only think of the following explanations:
None of those options are attractive. Indeed, they’re all dangerous. Not surprising, but dangerous.
{ 0 comments }