The situation with Miami-Dade County's libraries is just one more example of politicians trying to solve budget problems the wrong way. Resources were allocated to crony projects and all other services, coming up short for libraries. It was hoped that voters would accept higher property taxes to support libraries and arts, as they have done before. Now that higher property taxes are not in the cards, the administration is trying to cut county wages, benefits, and jobs to get the money to keep the libraries open. Naturally this is aimed at rank-and-file workers rather than the 3,000+ county employees who make over $100,000 per year.
Raising property taxes on weak values further depresses property values. Cutting wages, benefits, and jobs gives short-term savings but damages the economy and leads to higher social costs and further job losses. Either way starts a downward spiral. Both approaches are shortsighted, and next year we will be back in the same situation--with compounded problems and fewer options. The only way to increase property tax revenues is to have property values rise by a few percent. This can only happen in a growing economy where more people are employed at higher wages--not fewer people at lower wages.
What employer would want to establish a business in a major metro area that can't even keep its libraries open? And what will be cut next year, police? Fire and rescue services? Teachers?
The correct solution is to finance the short-term deficit, while implementing economic policies that will strengthen and grow Miami-Dade's economy and eliminate deficits forever. These are the same principles described in the Khavari Economic Plan for Florida at www.khavariforgovernor.com.
1. Create massive employment the right way, at no cost to taxpayers. Stimulus plans and tax giveaways never create jobs. Everyone but politician knows that when there is demand, businesses hire people. When there is no demand, they don't. Products and services that reduce long-term costs such as energy or insurance increase the wealth of the customers and, in the long run, cost less than zero.
Organizing demand for such products and services requires leadership, not tax money. If we organize demand for, say, 50,000 solar water heaters per year to be made in Miami-Dade County at a certain price, manufacturers will find a way to fill the demand and hire our neighbors to do it. If we organize demand for home improvements that permanently lower energy and insurance costs, tens of thousands of people will be needed, creating wealth for the customers, themselves, and our economy.
2. Create a publicly-owned county bank, which will save county residents billions of dollars per year in interest costs while earning money for the county. A billion dollars saved, staying in the county and re-circulating, can generate $5 billion per year in economic activity, enough to support 50,000 new middle-class jobs per year. When the bank earns money for the county by saving even more money for the residents, everyone wins. Property taxes can be lowered and deficits are ended forever.
I am ready to help Mayor Gimenez establish and implement these policies in Miami-Dade County as a private concerned citizen, just as I propose to do for the State of Florida as governor.
Farid A. Khavari, Ph.D. is a noted economist and independent candidate for Florida governor. He is the author of 10 books, including the 1993 classic Environomics: the Economics of Environmentally Safe Prosperity and Toward a Zero-Cost Economy (2009). His Economic Plan for Florida includes job creation, cleaning up our water, improving health-care quality and availability for everyone while reducing costs by 30% or more, reducing college costs, interest costs on mortgages and student loans, and more, all at no cost to taxpayers. The plan is explained in detail at www.khavariforgovernor.com.