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Monday, September 1, 2014
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    God & Taxes

    Georgia Underground

    by | Feb 14, 2013

    First, let me assert that money, like any other tool (a hammer, for example) is worthless, unless and until it is taken in hand and put to use. To be more precise, money is a measuring tool, at the same time that it is symbolic of energy expended and value accumulated. In that sense, money somewhat resembles a mound of oyster shells or cache of flint flakes, which attest to the activities of many collectors or one collector over a long period of time. Or the collection may just be evidence of a failure to dispose of waste. Regardless, just as a collection of detritus is tangible evidence of activities which occurred in the past, so is money. And, because it is tangible, we are able to count the accumulated stuff and put together an account of an expenditure of energy and time, which are otherwise fleeting and difficult to keep in mind. In that sense, both a shell midden and modern money can serve as an aide memoire — not an attractive attribute from the perspective of people who would rather we forget what’s been done.

    The funny thing about numbers, the symbols we use to count and compose our accounts, is that even the zero, which represents nothing, can tell a story (provide an account) whenever and wherever it is written down. In the records of Georgia’s assessors of land and the buildings people construct, for example, the designation of land as having zero value is particularly telling. Or perhaps more accurately, it raises questions about the composition and extent of what should properly be called the underground economy of Georgia–trade and exchange that doesn’t get registered in the official accounts, simply because zeros don’t add up.

    Although I concluded some time ago that Georgia, with its 159 counties is in essence a socialist state. Indeed, though the residents are seemingly unaware, some practices even seem to lean towards the communistic — not really possible because we all know that communism is definitely godless. So, it can’t be, especially considering that establishments of religion and other eleemosynary institutions have sprouted across the state, in the wake of the recession, like mushrooms after a rain and, perhaps not incidentally, stripping the ground beneath them of monetary value as they go.

    frbcentermasthead

    Frederica Baptist Condo Lease and Sale

    To cite one example, there’s the thirteen plus commercially zoned acres, which the Sea Island Company donated to the Frederica Baptist Church. While the property, still designated as commercial in county records and still carrying a land value of over eight hundred thousand dollars in the County’s records, no doubt as a testament to the Company’s largess, no tax bill was sent. Everybody knows church property is tax exempt. Ditto for the 17 unit commercial condominium complex in which the Church actually has quarters, while the rental from the businesses pays off the mortgage to the bank. Lots of zeros on their cards.

    But, establishments of religion aren’t the only ones whose land values disappear from the tax man’s books — apparently as a consequence of common use. Residential condominium complexes enjoy a similar substitution of zeros for land values, presumably in exchange for them being shared. So, the common areas for the Coast Cottages have a zero land value; not even the board walk across the dunes, which is inaccessible from the beach and excludes public access to the neighborhood, comes at a price. And the “worthless” twelve acres, on which the St. Simons Grand condominiums sit, are entirely fenced off–no doubt to ensure that no member of the public has an opportunity to drown in the pool.

    On the other hand, not all zero value common areas aim to exclude the public. Shoppers are obviously welcome to visit and spend lots of dollars at the Retreat Plaza shopping mall across the road from the airport. Though the land it sits on is also appraised as having zero value, there’s no evidence that the prices at Retreat are any less than further up the road, where the Longview Center’s land value is definitely appraised ($2.3 total), assessed ($944,920) and taxed ($21,991). So, it seems fair to conclude that there is some inequity on the ground.

    The Encyclopedia of Chicago tells us that:

    The underground economy involves the exchange of goods and services which are hidden from official view.

    Although the underground economy is generating more interest among academics, people who fancy themselves conservatives seem most interested. So, for example, the Washington Times opines that:

    The underground or “black” economy is rapidly rising, and the fault is mainly due to government policies.

    If they’re right, it should not come as a surprise that Georgia, a traditionally conservative state, has made it easy to hide all sorts of economic actitivy from public view. Or, perhaps more precisely, from the view and review by governmental entities, whose interest in things being transparent might not actually serve the interests of local constituents. But, it’s not, as the Washington Times wants to suggest, about the “unbanked.” Rather, on the state and local level it’s more about not letting on where the assets are and to whom they belong. When things go uncounted, it’s usually by design.

    “We will take care of our own; just leave us alone. Oh, and send money.” I suspect that’s Georgia, and maybe some of the other southern states, in a nutshell. How do they get away with it? By letting much of the economy go underground. It’s been estimated that the underground economy in the U.S. amounts to about 10%. Greeks, on the other hand, admit to as much as 30% and the most recent news out of Russia levies the charge that fully 46% of the Gross Domestic Product in post-Soviety Russia is in the underground. We are supposed to be scandalized by this revelation about the host of the G-20 Summit. The economists funded by the Ford Foundation proclaim:

    “So long as the Russian authorities fail to shrink the underground economy, Russia will continue to hemorrhage scarce capital, both illicit and licit, to the detriment of economic and political stability and undermining the nation-state,”

    Kar and Freitas, economists for an outfit that calls itself Global Financial Integrity, are worried about the nation-state being undermined by what they perceive not as an alternative, but an antagonistic challenge to the bureaucratic status quo. And that’s it, isn’t it — the very same thing the citizens of our individual states look upon with considerable suspicion. The nation and, increasingly, that entity’s security are supposed to be our main concern, our primary focus and the impetus for sacrifice. Global Financial Integrity. Has a nice ring to it, but what does it mean? The Greeks might well tell us it means “pay the banksters first and then worry about what we’ll eat.”

    Fact is, if we don’t have any money, we can’t pay. So, there’s a benefit to not admitting to having any money. I keep being reminded of the farmer’s wife in the Alps where I grew up. She had no money, but she had furs and fabrics and lord knows what other “treasures” all stored under her high bed.
    gieringweg.jpg
    The alpine farms, by the way, are still thriving. On the other hand, enterprise on the mainland of coastal Georgia is not thriving. How can a small business on a third of an acre with a thousand dollar tax bill compete with a ten acre shopping center that pays zero taxes on the land? Even more to the point, who’s going to make up for the redesignation of 600 acre planned development into the Cannon’s Point nature preserve and the loss of about $128 thousand in tax revenues? Never mind that on an appraised value of over $13 million, the speculators were only being taxed on five. Let’s hope the bird watchers and anglers drop some bucks in some palms.

    ###

    Monica Smith

    Monica Smith writes Hannah's Blog. Born in Germany, she came to the United States as a child, living first in California, then after an interval in Chile, in New York. Married to a retired professor at the University of Florida, where she lived for 17 years, she moved to St. Simons Island, Georgia, in 1993 and now divides her time between Georgia and New Hampshire. (New Hampshire, she says, is always interesting during a presidential election.) She and her husband have three children and five grandchildren. Ms. Smith says she "learned long ago that I am not a good team player when I got hired at the Library of Congress, fresh out of college with a degree in political science and proficiency in four foreign languages, to 'edit' library cards and informed my supervisor that if she was going to insist I punch the clock exactly on time, my productivity was going to fall from being the highest to being the same as everyone else's. The supervisor opted to assign me to another building where there was no time-clock. After I had the first of our three children, I decided a paycheck wasn't worth the hassle."

     

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