Asset Rich and Cash Poor

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We've written about almost every big angle in the ST3 debate, but a smaller one hasn't really come up outside comment threads. The property tax component raises howls from "fixed-income" retirees who state that the property tax bill will overwhelm their incomes, presumably forcing them to move. The ensuing comment war is not a credit to either side.

The basic contour is that someone says their tax bill will be too high given their income, generally implying a fairly lofty home valuation. Some other commenter offers "helpful" advice about how they can come up with the cash by downsizing, moving out of Seattle, etc., if not tarring the original commenter as, essentially, a rich person trying to avoid taxes. Then a senior accuses his counterpart of being a rich techie trying to force out others, shortsighted young people ignorant of their future status as a retiree, etc.

It gets unproductive quickly. But let's extract some common points that I'd hope we can agree on. First, that anyone with a little empathy can understand voting against a measure with as large as impact as forcing one to move. Indeed, I can't say that in their place I would do otherwise. At the same time, I'd like to have the decency to be apologetic that my circumstances were blocking much-needed improvements in transportation, education, or housing supply. But there's a natural, and not entirely unhealthy, prejudice towards avoiding disruption in people's lives, even if it means a slightly worse future.

And perhaps some people simply comment because they want their anxiety to be heard. But are there broader policy implications? King County and Pierce County have special property tax exemptions for seniors that make less than $40,000 or meet other criteria. Snohomish has a somewhat more complicated framework. As a political matter, these are almost certainly a vote-maximizing strategy, shielding the costs of new programs from the most likely voters.

On the other hand, property taxes on seniors don't make the measure any less progressive. The owner of a million-dollar home in Seattle today pays no more than 26% of a $40,000 income, well below the 33% threshold for affordable housing if the mortgage is paid off. ST3's property tax component costs the owner of that million-dollar home no more than a further 0.625% of their income. It's hard to tell a 30-something with a similar income but a young child, student debt, shaky health coverage, a horrible commute, and no real prospect of owning a conveniently located home* that only they should bear a burden, because someone else with none of those problems doesn't want to monetize even part of their extensive net worth.

* If you're wondering, this does not come particularly close to describing me.