A Promising Sign Regarding Sign Desecration

Results of a new poll of North Carolina voters shows that when it comes to provisions of a new billboard bill, legislators who have felt insulated may finally be risking support at the ballot box.

As smoothly and many feel deceptively crafted as SB 320 and HB 304 were  by the billboard lobby, North Carolinians are overwhelmingly opposed to its provisions.

But bi-partisan voter opposition to bills that favor out-of-state billboard companies isn’t new.  More telling this time is that the opposition is strong regardless of gender and geography.

Historically, men have been less protective of scenic preservation but this time they poll even more opposed to these bills than women.

Opposition to provisions such as permitting digital even where they are now prohibited runs 2 to 1 in the northeast and southeast and 3 to 1 along the mountains and metro areas where cities have already permitted them.

Of course, opposition is also high across the age groups billboarders and their remaining advertisers are trying hardest to reach.  The poll shows 5-to-1 opposed for those between age 30 and 45, increasing to 8-to-1 opposed among those age 46-65.

Of particular note to the few advertisers still using billboards is the high turn-off to turn-on ratio they have among consumers they are hoping to reach.

But most revealing is how voters plan to hold supporters accountable.

For a decade now, studies have found that elected officials are rarely held accountable at the ballot box, in part, because “the voices of American citizens are raised and heard unequally,” opening the door for special interests.

This is why a tax loophole, one of the six largest, permits billboard companies to escape paying their share of taxes by claiming their profits are only “rents.” 

Ironically, “rent-seeking” is also the word economists use to describe when companies such as these work the political system to gain favorable treatment rather than working to create economic value in the marketplace.

Similarly, this new legislation would also create another big loophole, permitting thousands of illegal billboards to become legal overnight, further desecrating the North Carolina brand.

To further assault North Carolina taxpayers, if passed and signed by the Governor, this new legislation will also guarantee billboard companies millions of dollars for each one that is removed when it comes time to widen the roadway.

This, even though the courts have ruled the billboards parasitic property because they would have no value in the first place were it not for the taxpayer funded roadways.

However, according to the poll, Tar Heel voters recognize that this is essentially a tax increase on them to benefit out-of-state billboard companies, not exactly the kind of tax-shifting voters like.

This provision in the proposed North Carolina legislation made voters overall less likely to support a legislator who votes for the bill by almost 5-to-1, including 4-to-1 among Republican voters.

If voters remember and follow through come election time, this would represent a sea-change where elected officials are held more accountable for actions they felt were safe in the past because they harmed only those who were not their constituents.

It is a mistaken calculus often used by organizations such as chambers of commerce and more passively, some tourism organizations, which align with the 1/5th of Carolinians who ally with the billboarders, including some doing so in direct opposition to the wishes of businesses and residents in their communities.

This latest poll may reveal not just overwhelming opposition but emergence of a resentment that could drive North Carolina voters to ban billboards altogether one day as voters have in some other states.

Loophole Entitlements And Upward Mobility

Apparently, Republicans aren’t so opposed to “entitlements” after all.

As an Independent, I found it funny that members of that party in national office office suddenly turned against their own proposal to close tax “loopholes,” labeling it as a “tax increase” once it was endorsed by Democrats along with budget cuts as a as a means of reducing the federal deficit during the debate over alternatives to “sequestration.”

It reminded me of a paper I read that was published the month before I retired on the last day of 2009.  The analysis was published by the Pew Charitable Trusts as part of the economic mobility project.

Tax loopholes predominantly favor the wealthy, households that don’t need them.

Beginning in 1974, two years after I graduated from college, the federal government launched a series of initiatives to incentivize personal savings including preparation for retirement beginning that year with Individual Retirement Accounts (IRAs) and followed by legislation to authorize 401 (k) plans in 1978.

In 2010, these and other tax-favored savings vehicles cost the federal government at least $130 billion in 2010, and as much as $360 billion when homeownership incentives are included.

However, those influencing the rules for these vehicles including lobbyists on behalf of special interests have successfully diverted 70% of the benefit to only the groups with the very highest quintile of income, people who had the means to save anyway.

According to the Pew analysis, only 0.2 percent of the benefit goes to the lowest income group.

Lobbyists also game the system on behalf of the beneficiaries of corporate welfare.  For instance, just before I recently cut the cord entirely on subscription television, I watched as one panelist on a news program in North Carolina could hardly contain his disdain, calling it a subsidy for the state to require utilities here to invest in alternative sources of energy.

Neither the panelist nor, apparently, the moderator was unaware that fossil fuel energy has been subsided by taxpayers nearly from its time of origin or that one of the primarily purposes of our country’s huge naval fleet today is to provide security to oil shipping lanes, free of charge.

The only hypocrisy greater than the vehement opposition from oil and gas interests to granting even a sliver of those incentives to benefit alternative energy research is that of politicians and other sycophants such as that panelist.

Personally, thanks to advice early in my now-concluded career from older members of my governing boards, I started almost immediately after they were created to have as much of my income as possible automatically diverted to these tax favored savings vehicles.

However, until I read that 2009 report a few weeks before retiring, I didn’t realize that only a small share of the population did.  A 2007 Congressional Budget Office analysis estimated that only 29% of workers invested in 401 (k)-type plans and only 7% utilized IRAs (4% traditional IRAs and 4% in Roth IRAs.)

The report documented that only one-third of workers under age 30 participated as I did compared to 63% of 45-59 year-olds.  More telling was that while 80% of those making over $80,000 participated, only 50% of those did who earned $20,000 to $40,000.  Participation fell to 20% for those earning less than $20,000.

The CBO report found that about 17% of workers participated in defined-benefit or pension plans.  Thanks to historical overviews such as one in 1991 by Patrick Seburn, an economist at the Bureau of Labor Statistics, we know that pension plans were first initiated in the U.S. for veterans during the Revolutionary War.

One of the very first private sector pension plans was initiated by American Express in 1875, followed by many railroads and utility companies.

By the 1920s, these plans were common and some were administered by labor unions. In 1921 Metropolitan Life Insurance Company innovated the first annuity contracts, making pensions less expensive.

Businesses struggled with pension obligations during the Great Depression of the 1930s, often because they had been under capitalized which contributed to the evolution of federal Social Security as one of the first contribution-based retirement programs.

However, retirement continued to be both/and and by the end of 1960, half of all private sector workers were covered by pension plans.  The demise of these plans began in the Reagan era as documented so well by Rueters journalist and editor Chrystia Freeland in a book published last fall entitled Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else.

Following campaign ads in 1984 promising “it’s morning in America again,” pension-related retirement continued to grow for a few more years but soon met its demise as capitalist, public spirited and self-restrained CEOs gave way to winner-take-all leveraged buy-outs and savaged pension plans.

We know now that far from being “morning” this period marked the beginning of a decline in upward mobility and the middle class and a gap in incomes.

I contributed to and participated in both private and public sector defined-benefit pension plans as well as the tax-favored retirement plans that began in the 1970s. Many are jaded on the latter after having much of what they had saved or accumulated wiped out by in 1987 and after.

I know it is vogue for some state governors, especially it seems those who are Republican, to go after pension plans today.  But frankly, as illustrated by the lack of upward mobility and growth of the middle class over the intervening years, I’m not at all sure America wasn’t much better off when defined benefit pensions were nearly universal.

Are you?