Filling A Bottomless Pit

In January of this year, I posted an article entitled, “If You Give A Mouse A Cookie,” relating to a children’s book published in 2013. The basic story line of the book is that if you give a mouse a cookie he will expect milk and other things to go with it. That story had to do with a company in Wisconsin that discovered that whatever concessions you make to a special interest group, they will not be enough. This story has to do with the tax situation in Princeton, New Jersey.

MSM posted a story today about a discussion in Princeton, New Jersey, about whether or not Princeton University should be tax exempt.

The article states:

Free lectures, admission to athletic games and concerts, even shuttles to Trader Joe’s are some of the perks that neighbors of Princeton University get from New Jersey’s only Ivy League school.

A growing number of residents, though, resent the gestures. Riding a national wave of discontent with nonprofit institutions, they’re suing to challenge the tax-exempt status of Princeton, whose $22.7 billion endowment makes it the fourth-richest U.S. university. The outcome could cut homeowners’ annual property taxes, averaging $17,699, by a third. It also could end the freebies that make Princeton a cushy oasis while other New Jersey towns, burdened by high public-worker costs and flat state aid, struggle to maintain basic services.

There are a lot of questions that come to mind after reading this. What is the budget of Princeton, and has anyone considered cutting the budget?

The article further reports:

The university pays its hometown about $8 million in annual levies toward a proposed $61.9 million municipal budget. It kicks in another $3 million voluntarily, a boost for emergency services and public works. The rest, the freebies, make for what the school calls positive town-and-gown relations.

So the tax-exempt University already pays more than 10 percent of the municipal budget, and now the city wants to take away its tax-exempt status. It’s interesting to me that the article cites the worth of the University to support its argument. This is classic redistribution of wealth. Princeton has acquired its wealth honestly. It belongs to Princeton. Now the municipality is trying to figure a way to take what has been rightfully earned away from the entity that earned it and give it to the city, which hasn’t earned it. Maybe it’s time that the City of Princeton redid its budget rather than resorting to legal theft.

Recovery???

Yesterday the Washington Times posted an editorial about President Obama’s request to extend unemployment benefits for another three months. The original extension of unemployment benefits to 99 weeks occurred in 2008, at the height of the recession. According to the Obama Administration, the recession ended in the summer of 2009. So why do people still need two years of unemployment benefits?

The editorial reminds us:

Since the Great Recession began in 2008, Congress has supplemented the 26 weeks of jobless benefits traditionally provided by the states, extending them to 99 weeks.

Ordinarily, this wouldn’t be an issue because such extensions have been temporary, but Mr. Obama’s economy has spawned a jobless “recovery,” and more workers continue to join the unemployment line.

Democrats see this not as an opportunity to reconsider the failure of Obamanomics, but as an excuse to spend another $25 billion. The Senate will vote this week on a three-month extension with a $6.5 billion price tag.

…There’s a negative consideration to extending unemployment subsidies time after time. A 2008 Princeton University study comes to the obvious conclusion that workers are much more aggressive in their job searches as their benefits near the end, “increasing sharply in the weeks prior to benefit exhaustion.”

Alan B. Krueger, a former chairman of Mr. Obama’s Council of Economic Advisers, was a co-author of the report. A Swedish study, finished in 2008 as well, concluded that more generous unemployment benefits increased unemployment rates. The linkage, it said, is “fairly robust.”

The year before, Sweden reformed its unemployment compensation system, such that recipients could receive up to 60 weeks of benefits, but with a catch. The longer someone is unemployed, under the new program, the less he receives in assistance.

The diminishing benefits have been a powerful inducement to look for work.

Unfortunately, extending unemployment benefits has become a political issue, which means that no one is considering whether or not it will actually help or hurt the country or the economy. Until Congress includes enough patriots who want to do what is right for the country, we can expect to have more political gamesmanship on this and other issues.

Enhanced by Zemanta