Tax Free Day or The Cost of Government Day

Tax Freedom Day or The Cost of Government Day

This year, July 11, 2007, is Tax Freedom Day or The Cost of Government Day, which is the day when the average wage earner stop working for the government and start working for him/her self. This year the date is two days longer than last year. You have to work 192 day or more than half of you gross wages go to the Government. They start counting on January 1st and count every day, Saturday, Sunday and Holidays, until the reach the amount of money needed by the government to run. This includes the taxes you pay to the Federal, State and Local governments; it also includes other government fees that you may pay, for example auto registration (Officially a fee not a tax). There are also government mandates that you have to do and you pay for either in an extra fee or as a cost of doing business.

The government raises the minimum wage and all the products you buy and services you use go up to cover the increased costs. The state requires all insurance companies to cover the cost of eye glasses and you do not wear glasses but you insurance costs increase. This year there was 13.2 BILLION dollars spent on special projects that members of congress want for their district to help them get reelected. For example in two different districts the congressmen or someone they knew owned property on the other side of a river. In the Federal Highway Approbations Bill both representatives placed money for a bridge to cross the river which would increase the value of the property on the other side of the river.

Another way that the cost of government increases is through the passage of Unfunded Mandates. The Special Education Law, IDEA, is an example of an under funded mandate because the cost of that law is estimated at 18 Billion Dollars with the Federal Government giving schools an extra 1 Billion dollars a year. The balance comes from local and state taxes. Another example of an Unfunded Mandate is the Americans with Disabilities Act (ADA). This is the law that says that public buildings must be made handicapped accessible. The rational is that it is required in new construction and any major remodeling (usually over $25,000.00) so it is not a major cost increase as you have to put in doors anyways. In one school district there was a school with an elevator that met the requirements of ADA. The student has a special wheel chair that was too big to fit into the elevator. When it was suggested that the use a different chair in school (purchased by the school) the parents refused. The Federal Agency required the school to install a new elevator into an old building at a cost of over $250,000.00. No federal or state money could be used.

Some laws passed seem to be very helpful and should not cost us anything. One such law was the Truth in Lending Law. The intent was to simply let people know how much it was costing them to borrow money. Banks and lending institution were to develop a form to explain this to the people. By the time the federal regulators (the Bureaucracy) finished there were several more papers required to get a loan and most people did not know from the forms how much they were paying. Many Banks developed an extra form to explain to the people how much it was costing them to borrow the money. All the forms have to be registered with the county and they charge by the page, so you costs just increased by the government trying to help you.

The next time that a Senator or Congressman tells you they are going to do something for your benefit and it won't cost you anything remember what unfunded mandates are and how they can end up increasing the cost of government and you pay for the bill.

For more information on the cost of Government check out this web site: http://www.atr.org/national/cogd/index.html