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You want to know how to save various sources of federal funding…this will be tougher than you know You will only get the static analysis not the dynamic.

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Presentation on theme: "You want to know how to save various sources of federal funding…this will be tougher than you know You will only get the static analysis not the dynamic."— Presentation transcript:

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2 You want to know how to save various sources of federal funding…this will be tougher than you know You will only get the static analysis not the dynamic analysis…first the state…Ohio could have fired every state employee and not have the books balance in 2011

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4 That is just the General Revenue Fund; Transportation is even more doomed… The youth drive > 7.7% Core inflator is 5%: Decline in gas usage is 2% Net loss of 2 pennies of tax Cash for Clunkers County Engineers/gravel Fed have propped up Highway trust with $30 B

5 Now about the fed annual budget Prior to the % of GDP taken in taxes was 15.5%: Starve the Beast On it was 19.5% Historically we float between 18% and 19% We are still spending 23% of GDP France is near 40% To tax at 23% of GDP means we tax the upper two of six tax brackets at 78%

6 So now let’s talk about the all funds federal budget… The operating fund deficit is $16 trillion; Defense is 25%, the two wars were 25% of that The all funds deficit is $ 87 trillion That includes all deficits such as Social Security at $ 20 trillion Medicare at $43 trillion 550% of our GDP

7 If we tax all income over $ 66 k/yr we get $ 5.1 trillion If we tax all corporate profit we get $ 1.6 trillion We could increase all taxes that high and still take a dozen years to dig ourselves out, or tax half that amount and take 24 years…with not spending on anything else… This is static…not dynamic

8 The tax system is hot Top 1% has risen to 41.8% in 2008 from 17.4% in /3rds income from the top 1% comes from nonwage income, including capital gains, dividends and proprietor's profits. (Docs sub chapter S) From 1960 to 2000, payroll taxes were never lower than in the previous year, individual income taxes dipped only twice, and corporate taxes dropped 11 times. Since 2000, individual income and corporate tax revenues dropped five times, while payroll taxes fell twice. Not only do revenues from individual tax returns drop more often now. They fall more severely, with recent collapses of 14%-20% versus the 3%-5% range before 2000.

9 Just one more thin wafer… So…taxing the 1% more gives us more volatility The top 1% hold so much more wealth than traditionally Currently 90% of income tax comes from the top 10% 90% of wealth dissipated by third generation

10 The Biology of Humans says tax the 1%…why? BRS; we have five core values Security Health Children Family Fairness Fairness will be the battle of this age; more on that in the book section

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12 So is there anything personally you should do? Don’t buy a new car Don’t upgrade your kitchen Encourage your kids not to go to Oberlin, but go to Wright State and study math Why? Since 1985, the number of college graduates in soft sciences has doubled, but hard science has stayed flat

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14 What can you read to prepare? MoneyBall by Michael Lewis staring DATA Every time you see the phrase “Front office” substitute in “local governments” The Big Sort by Bill Bishop Landslide Ctys Coming Apart by Charles Murray Buckeye Battleground by John Green The Fourth Turning by Strauss and Howe Capricious Chaos by some guy not yet

15 Ok, how about professionally? Rep. Amstutz put all his chips on the table Local Government Innovation Fund “You want to pay local governments to do the thing they should be doing?” You can lead a horse but… $45 million in loans and grants vfund.htm

16 What is the purpose? To promote shared services, collaboration and consolidation that result in both cost savings and better services. Contact your legislators to continue this program as this is your only hope to get that new car. The other thing is more data is coming SB _SB_356

17 Look at the Cupp Report /ODE/ODEPrimary.aspx?page=2&TopicRelation ID=1441 Costs of local government; it will pass Get your costs down; remember Money Ball Look to MA; “242 regional housing authorities into six regional housing boards. Consolidation would save up to $10 million in annual administrative costs, while streamlining agencies and centralizing control” Ohio is a data desert but not all data is helpful

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20 So…what do you do? Get paid to share your services Don’t say you are doing everything; you are doing everything you are comfortable Ask local businesses/CPAs to form an advisory team to perform a management audit team or ask AOS Have your associations work to develop chart of accounts Develop a plan for surviving without CDBG Strong charter county

21 Finally…you hope…some practical things Subscribe to Hannah News Services Have lunch with people you have nothing in common with… Read those books Send me hate at @GO_GeneK Send me examples of good and failed policies

22 “It ought to be remembered that there is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in introducing a new order of things, because the innovator has for enemies all those who have done well under the old conditions, and lukewarm defenders in those who may do well under the new. This coolness arises partly from fear of the opponents - who have the laws on their side - and partly from the incredulity of men, who do not readily believe in new things until they have had a long experience of them.” Nicollo Machiavelli, The Prince

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