Myriam Marquez, The Miami Herald

March 6, 2009

Myriam Marquez
The Miami Herald
One Herald Plaza
Miami, Florida 33132-1693

RE: You’re gaining on it! – Some comments on your marvelous column about new solutions to old problems in today’s Miami Herald

Ms. Marquez,

“I know. It’s nuts to raise taxes in a recession.”
You

The admission of ignorance is the first step on the road to knowledge. Who knows what will come next? Perhaps wisdom. Quien sabe?

I share with you a nugget of wisdom from my magic bag.

#26 – “If you tax something you have less of it.”

Ergo

If you increase taxes in a recession in anticipation of raising more revenue you wind up with less than when you started.

What if the Miami Herald were to raise its sales price again? Surely the drop in revenue caused by the drop in sales would be offset by the rise in price. Why not make the daily price $2.00? How about $7.50 for the Sunday version? The perception of value would be such that some people would buy two or three copies.

If you come back through the mirror and take a peek at the reality of raising prices to offset drops in revenue you will experience “the triumph of hope over experience”. “Experience” says Edmund Burke “is the only school at which some people will learn”. Alas, the same lesson is going to be learned again.

The House of Representatives passed a budget that is 8.4% higher than last year. What were those people drinking? Is there a family in America that does not begin each day with the hope that its life will not be turned upside down by noon? Congress believes in the perpetual supply of golden egg laden geese. They are an endangered species. In Broward County the number of students enrolled in the public school system has gone for 4 years. Is that reduction anywhere reflected in any part of the expense budget? Would not fewer students suggest fewer half pints of milk? I’ll spare you the suspense.

NO!


You talk about closing loopholes in Florida’s sales tax

Here’s a symbolic place to start.

Why not have the peripatetic matadors who sell your newspaper in the crossroads of South Florida collect sales tax on each sale? If those pesky pennies prove problematic take it out of your end. What’s fair is fair, right?

I end today’s tutorial with another quote from you.

“The biggest unfairness if billions lost to companies that
sell their stuff on the Internet. Florida law requires
sales tax be collected on those sales…”
You – redux

Suppose I buy a lobster pot in Wiscasset, Maine. It is put on a truck and begins its journey to Florida. Do I owe sales tax to Massachusetts, Rhode Island, Connecticut, New York, New Jersey, Delaware, Maryland, Virginia, North Carolina, South Carolina, and Georgia?

You continue

“Crist and the Legislature need to draw the line at Internet sales and tax them.”

Alas gentle lady, the turd in the punch bowl is the neither Governor Crist nor the Legislature can do that. You are right when you mention the Supreme Court. The relevant case is Gibbon v Ogden. It has all the elements of today’s headlines. “Special interests”, lobbyists, corrupt politicians – Thank God for the good old days! The one “iron bottomed, copper sheathed” principle to emerge from it was that no state can tax the transactions of another state. It was decided in 1824.

Your road to more money does not begin in Tallahassee. It starts at the Supreme Court of the United States. Just get them to reverse themselves.

You go, girl.

Like I said, “you’re gaining on it”.




PS – Rule #16 – “If you are going to panic, be the first.”