Category Archives: Taxation

Judge slams speed camera scam

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Judge Robert Ruehlman of Hamilton County Common Pleas Court said Elmwood Place’s speed cameras are unfair to motorists.(Photo: Amie Dworecki, The Cincinnnati Enquirer)

“It is a scam the motorist cannot win,” the judge wrote in invalidating the ordinance.

Cincinnati Enquirer | Mar 8, 2013

by Kimball Perry

ELMWOOD PLACE, Ohio — In a scathing ruling, a Hamilton County judge ruled that an ordinance allowing this village of 2,000 to install speed cameras is invalid and unenforceable.

Critics have said those cameras, which already have generated about $1.5 million in fines, have more to do with revenue enhancement than safety in this Cincinnati suburb nearly surrounded by the city.

STORY: Speed cameras a flash point in Slovenia

STORY: States split over traffic cameras

“Elmwood Place is engaged in nothing more than a high-tech game of Three-card Monty,” Common Pleas Court Judge Robert Ruehlman wrote in his Thursday decision. “It is a scam the motorist cannot win.”

Thirteen states and the District of Columbia have speed cameras operating in at least one location, according to the Governors Highway Safety Association. Ohio has 13 other jurisdictions that use them, the Insurance Institute for Highway Safety says.

A dozen states have laws prohibiting them.

The village put the cameras in place in July to slow speeders — not to rake in revenue — officials there have said. About half of the fines go to the village as new revenue.

The village hired Maryland-based Optotraffic LLC to install the cameras and bill offenders, allowing the company to keep part of the fine money.

When motorists began receiving the $105 speeding tickets in the mail, they exploded in anger. Many have said they now go out of their way to avoid driving here, and many business owners say the cameras and the fallout are hurting business.

Many hired lawyer Mike Allen to fight the cameras.

“It is obvious that the village of Elmwood is motivated by financial considerations and not public safety,” Allen said. “This is a victory for the common man and woman who does not have $105 to give to the village of Elmwood.”

Allen added that Ruehlman’s ruling could be the nation’s first to address the specific constitutional challenge — whether a driver’s due-process rights were violated.

“I think the preliminary injunction is pretty much the whole case,” Allen said.

Village Solicitor Anita Vizedom couldn’t be reached for comment.

The judge was particularly biting in writing his decision, blasting the village for taking from its residents instead of providing services to those who pay for them.

“The entire case against the motorist is stacked because the speed monitoring device is calibrated and controlled by Optotraffic,” the judge wrote.

If motorists receiving tickets wanted to contest them, they had to request an administrative hearing that came with a $25 fee.

“The hearing is nothing more than a sham,” the judge wrote.

While Ohio law allows such cameras, Allen argued successfully that the village didn’t display the proper signage that must accompany them.

Allen expects Elmwood Place to appeal the judge’s ruling.

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Why Germany Is Failing to Boost Its Birth Rate

Familienpolitik auf dem Prüfstand
Germany dumps hundreds of billions of euros into its family policy each year, but it isn’t paying off, with the number of births continuing to shrink. DPA

SPIEGEL | Feb 6, 2013

Germany spends more on families than most European countries, but its birth rate is falling. A government-commissioned study seen by SPIEGEL argues most of the money is being wasted. Instead of complicated benefits and tax breaks, the government urgently needs to invest in preschools.

A study commissioned by the German government has reached a damning verdict on the country’s efforts to boost its low birth rate, saying billions of euros are being wasted on complex benefits and tax breaks that are largely ineffective and in some cases counterproductive.

Europe’s largest economy spends some €200 billion ($270 billion) on promoting children and families per year — that’s almost two-thirds of the federal budget. But its birth rate, at 1.39 births per woman aged 15 to 49, remains among the lowest in Europe and compares with an Office of Economic Cooperation and Development (OECD) average of 1.74.

The number of births in Germany has fallen to a record low. It was just 663,000 in 2011, 72,000 fewer than a decade earlier.

The German government ordered a detailed cost-benefit study of its family policies five years ago. The panel of experts led by Basel-based consultancy Prognos has completed a 66-page interim report that SPIEGEL has seen.

Its findings could open up a major battleground in this year’s election campaign because they amount to an indictment of 60 years of German family policy. Successive governments, whether from the center-right or center-left or grand coalitions, it seems, got it wrong. And some of the most expensive measures often yield the least benefit.

The study makes enlightening reading for those who wonder why Germany is consistently near the top in international rankings for family spending while its birth rate and job prospects for young mothers are near the bottom.

The government had pledged to release the findings in the current parliamentary term. But officials no longer seem in a hurry and it might not be made public before the September general election. That may be because the study supports calls by the opposition center-left Social Democrats and Greens for a massive expansion in preschool facilities and all-day schools, as well as caps on tax benefits for married couples.

Outdated Notions of Family Life

The findings run counter to a traditional view of the ideal family still held dear by many in Chancellor Angela Merkel’s conservative Christian Democratic Union party: Dad earns the money, Mom stays at home and looks after the children. That, say the government-commissioned experts, can no longer serve as the basis for modern policy-making.

The government’s latest policy initiative caused intense controversy, with opposition parties saying it was trying to transport Germany back to the 1950s. Launched at the insistence of the CDU’s staunchly conservative Bavarian sister party, the Christian Social Union, the “childcare allowance” will come into force this August — and pay a benefit of €100 per month to stay-at-home mothers.

The authors of the study say that the current tax and benefit arrangements discourage women from working full-time when they have children, discriminate against unmarried parents and in general aren’t making it easier for people to raise children.

The web of benefits is so complex that even experts don’t fully grasp it: There’s a “child supplement,” “parental benefit,” an “allowance for single parents,” a “married person’s supplement,” a “sibling bonus,” “orphan money” and “child education supplement,” not to forget the “child education supplementary supplement.”

Responding to the SPIEGEL article, Family Minister Kristina Schröder, 35, mother of a one-and-a-half-year-old child, defended her policies. “I don’t regard family policy like an investment banker with the aim of profit-maximization,” she told the Passauer Neue Presse newspaper on Tuesday. She said she was opposed to a policy “that focuses more on macroeconomic profit than on human solidarity.”

Schröder called on companies to help boost the birth rate. “The most important thing is to adapt working life more to the needs of families instead of going on requiring families to keep on adapting to the requirements of the working world.”

Manuela Schwesig, a deputy leader of the center-left Social Democratic Party, said: “The government’s policy on families is shaped by a picture of the family that is half a century old. Single parents or couples with children but without a marriage certificate are virtually ignored.”

Cash or Daycare

The central question of family policy is whether the government should invest in education and preschool facilities or simply give families cash.

In Germany, governments have always chosen the latter option, not least because benefits and tax breaks tend to win votes. The problem is that the money often doesn’t end up reaching the people who need it.

Take Claudia Kinski and Andreas Schulte*. They both work and are raising a child. He has a public sector job and works in shifts. She does security checks at a major airport. They always await their new shift rotations with trepidation. Will they have to work a lot of weekends this month? Will they have to start work at five in the morning or eight at night? The rotation determines how often Claudia will see her 11 year-old son, when she will need a babysitter, and for how long.

“Sometimes I have to ring him up from work in the morning to wake him up and tell him where he can find his breakfast,” she says. “An hour later I ring him up again to make sure he leaves the house.”

The fundamental problem that faces this family and many others is that they can’t find adequate daycare facilities. They earn too much to qualify for most of the benefits, and they don’t get tax breaks because they’re not married.

The study criticicizes some of the main components of Germany’s family benefits system:

so-called “tax splitting” for married couples, in which the husband and wife each pay income tax on half the total of their combined incomes. This costs the government some €20 billion a year and is one of the most expensive instruments. It rewards married people who have different incomes. The bigger the income difference between them, the bigger the tax advantage. In the best-case scenario, they can get a tax break of up to €15,694 per year, if there’s only one earner. The sytem means the “wedding market is often more lucrative than the labor market,” says family policy researcher Jutta Allmendinger. Single parents, unmarried couples or same-sex married couples with children, get nothing. If Mom and Dad aren’t married, they’re treated as singles.
The child benefit is the most expensive family policy tool, costing some €40 billion. At present, parents get €184 per child per month. Adjusted for inflation, that’s over three times higher than in the 1970s. But the study says it’s a “fiscally relatively expensive way to avoid poverty and doesn’t create any beneficial effects in terms of employment.” Meaning: poorer families don’t really profit because child benefit is offset against other benefits they get. And it tends to encourage women in middle-class families to stay at home.

The system is damaging the economy because it discourages women from seeking full-time employment. That’s the vicious circle of the German tax and benefit system. The state hands out generous payments like the child benefit but in turn charges high taxes and welfare contributions on employment. As a result, almost 50 percent of working women in Germany are in part-time employment — more than in most other European countries.

The study says a far more effective and cheaper way of helping families and boosting the birth rate is to open more preschools. It found that mothers with children aged up to three years who have found a place in a nursery work 12 hours hours more per week on average than mothers who haven’t been able to find a place. The income gain is almost €700 per month before tax. It’s a similar story for mothers of children aged between three and six years.

The researchers say there’s empirical evidence of a correlation between the availability of preschool places and the birth rate. They refer to certain rural districts of western Germany where an increase in the number of daycare spots for children by 10 percent led to an increase in the birth rate to 3.5 percent from 2.4 percent within two years.

So nursing care expansion could be at least partly self-financing. “The rising employment activity of mothers and the resulting increased revenues from taxes and social contributions means that a large part of the original outlay would flow back to the state,” the study says.

Here’s an intriguing statistic: Germans aged between 25 and 29 can expect to receive family related benefits and tax exemptions totalling €133,400 by the end of their lives. That sounds like a tidy sum. But almost 85 percent of it consists of monetary and tax benefits that will have relatively little impact. Only 15 percent is in the form of tangible services like preschools.

Merkel’s government doesn’t see that as a problem. Family Minister Schröder praises the new childcare allowance for stay-at-home mothers as a “fair offer” and says she’s a fan of the married couple’s tax-splitting provision. “Marriage,” says the 35-year-old, “has an intrinsic value for the state, even as a childless community of responsbililty.”

But what many parents really need is a policy that integrates leisure activities into the school system, that pays babysitters more and does more to help private households that employ nannies.

Some Conservatives Realize Need for Change

Even CDU politicians are realizing this, especially at the local government level. Take Sonneberg in the eastern state of Thuringia. The town of 22,000 opened one of Germany’s first 24-hour daycare centers two years ago. The project was initiated by CDU mayor Sybille Abel. It looks like a designer hotel and cost the city €1.4 million to build. Sonneberg has many car components firms and two large hospitals where people work in shifts. Unemployment in the town is just 3.6 percent. The new center, called Zukunft (Future) is the town’s 14th nursery. It’s a rare paradise for parents. “We as former GDR citizens evidently have different priorities in this regard,” says Abel, referring to communist East Germany’s good record on providing childcare facilities.

Even though the study’s findings are critical of government policy, they provide Merkel with an opportunity to sweep aside outdated ideologies and start dealing with the realities of modern life. “It’s time for a paradigm change in family policy,” says one of the authors of the study.

Some politicians may mock subjecting children and families to such a rigorous cost-benefit analysis — but there is no denying that family policy is a massive investment program in the future of society. As such, it should be a central focus of the election campaign.

Yahoo joins Dell swelling Netherlands’ $13 trillion tax haven for multinational companies

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Marissa Mayer, chief executive officer of Yahoo! Inc., smiles during TechCrunch Disrupt SF 2012 in San Francisco, on Sept. 12. Yahoo has taken advantage of the law to quietly funnel hundreds of millions of dollars in global profits to island subsidiaries, cutting its worldwide tax bill. / DAVID PAUL MORRIS/BLOOMBERG

Now, as a deficit-strapped Europe raises retirement ages and taxes on the working class, the Netherlands’ role as a $13 trillion relay station on the global tax-avoiding network is prompting a backlash.

delawareonline.com | Jan 26, 2013

Inside Reindert Dooves’ home, a 17th century, three-story converted warehouse along the Zaan canal in suburban Amsterdam, a 21st-century Internet giant is avoiding taxes.

The bookkeeper’s home office doubles as the headquarters for a Yahoo! Inc. offshore unit. Through this sun-filled, white walled room, Yahoo has taken advantage of the law to quietly funnel hundreds of millions of dollars in global profits to island subsidiaries, cutting its worldwide tax bill.

The Yahoo arrangement illustrates that the Netherlands, in the heart of a continent better known for social welfare than corporate welfare, has emerged as one of the most important tax havens for multinational companies. Now, as a deficit-strapped Europe raises retirement ages and taxes on the working class, the Netherlands’ role as a $13 trillion relay station on the global tax-avoiding network is prompting a backlash.

The Dutch Parliament is scheduled to debate the fairness of its tax system today. Lawmakers from several parties, including members of the country’s governing coalition, say they want to remove a stain on the nation’s reputation.

“We should not be a tax haven,” said Ed Groot, a parliament member from the Labour Party, which along with the People’s Party for Freedom and Democracy took power in November. Both ruling parties are “fed up with these so called PO Box companies,” he said. “If they go somewhere else we are not sorry at all because they spoil the name of Holland. Otherwise you can wait for retaliation measures and this we don’t want.”
War Declaration

Last month, the European Commission, the European Union’s executive body, declared a war on tax avoidance and evasion, which it said costs the EU 1 trillion euros a year. The commission advised member states — including the Netherlands — to create tax-haven blacklists and adopt anti-abuse rules. It also recommended reforms that could undermine the lure of the Netherlands, and hurt a spinoff industry that has mushroomed in and around Amsterdam to abet tax avoidance.

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Are police handing out traffic tickets to meet quotas? Looks that way

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According to local resident Phil Palter, there can be up to five cops writing tickets on a Saturday afternoon at St. Pauls Square in Toronto.

“There’s certainly nothing to do with protecting the citizen…”

CTV | Jan. 26, 2013

It’s hard to argue against a traffic ticket that involves public safety. But if you’re frustrated after getting a ticket for some minor violation, you’re not alone.

In times past, a police officer would often give you a warning and send you on your way.

Not anymore.

These days, it seems, nobody gets a second chance. A hefty ticket is the order of the day.

It’s happening in cities across Canada, but Winnipeg appears to be the worst.

Police there issued 57,000 tickets in 2011. In 2012, city hall asked the police to increase their revenue from tickets by $1.4 million.

Critics say police officers are under pressure to issue a certain number of tickets.

“I think most officers would be happy to provide a discretionary warning,” said Mike Sutherland, head of the Winnipeg Police Association. “The difficulty comes when there are significant work place consequences imposed on officers if they fail to hand out a certain number of tickets in a prescribed period of time.”

Most of us would call that a quota, but police management and city bureaucrats are reluctant to use the “Q” word. Mike Sutherland isn’t buying it.

“It can be called by a variety of different names,” he said. “It can be called an objective, or an expectation. Those sorts of terminology are used to disguise the fact that it simply is a quota.”

With so much time devoted to handing out tickets, you might conclude that Winnipeg is a sleepy place where the crime rate is low and police have little else to do.

Not so.

This city of 700,000 people has the dubious distinction of being the murder capital of Canada.

It also has the highest rate of violent crime and robbery in the country.

You would think that all overtime pay for police would be spent fighting those crimes.

But that’s not happening.

“In this city they ask them to come in and work extra days to just do traffic enforcement,” said Len Eastoe, a former police officer who now fights traffic tickets. “So we’re paying them a 10-hour overtime shift to just do traffic enforcement, when in fact our city is plagued with a lot of other serious crime.”

With so much emphasis on traffic enforcement, Sutherland worries that the people of Winnipeg are losing respect for the police.

“If the traffic enforcement situation becomes more focused on revenue and inappropriately focused on revenue as opposed to public safety, then I think it undermines to some degree the public confidence and the relationships that we’re trying to build.”

That public sentiment is echoed across Canada in other cities.

“I think that they should be going after people who are real criminals and spending their time a little more wisely,” said one driver outside a traffic court in Toronto.

The Toronto police issued a statement to W5 saying, “The Toronto Police Service does not have a traffic ticket quota for its officers.”

Which makes you wonder what attracts officers to a quiet street in the centre of Toronto called St Pauls Square?

“There’s certainly nothing to do with protecting the citizen,” said Phil Palter, a resident of the area. “There’s no businesses on that street. You don’t have robbery. You don’t have possibility of accidents of people being run over. You don’t have speeding.”

All there is on St Pauls is a right hand turn to access the street from Bloor, one of Toronto’s busiest thoroughfares. The turn is legal during the day, restricted at night, but it’s not allowed anytime on Saturday and Sunday. And on weekends, the police are there, stopping drivers and handing out tickets.

“You can have up to five cops sitting there on a Saturday afternoon,” said Palter. “It’s so bizarre. And that’s why so many people have complained about it.”

And not just in Toronto. Drivers in other major cities complain about what they believe are quotas imposed to raise revenue for cash-strapped municipal governments. But so far it the issue hasn’t spread wide enough to come to the attention of The Canadian Association of Chiefs of Police.

“So far it hasn’t,” said Jim Chu, Vancouver’s Chief of Police and President of the national association for 2013. “But if it was [happening] that would not be a good thing. Because you’re tying enforcement, using the powers of the state to making money and that’s not the purpose for why we’re out there. We’re out there to keep the streets safe, not to make money.”

In other words, the reason police are out there is to serve and protect, not collect.

The Treasury Has Already Minted Two Trillion Dollar Coins

What the advocates of the $1 trillion coin are, therefore, proposing is to tax us in a hidden way.  This is not just taxation without representation.  It’s also taxation with misrepresentation.

While inflation, let alone hyperinflation, has not yet occurred, everything is in place for this outcome. 

forbes.com | Jan 19, 2013

by Laurence Kotlikoff

No doubt, you’ve heard about the latest irresponsible fiscal/monetary proposal to be floated by members of Congress and the erstwhile economist, Paul Krugman, whose lunch was just eaten by Jon Stewart.  

It entails having the Treasury avoid the federal debt limit by handing the Federal Reserve a single $1 trillion platinum coin.  The Fed would then credit the Treasury’s bank account with $1 trillion, which the Fed could spend on the President’s lunch, a $200 toilet seat, a new aircraft carrier, more Medicare spending – anything it wants.

Is there anything special about platinum? Well, yes.  The coin doesn’t have to contain $1 trillion worth of platinum.  It can be microscopic for all the Fed cares as long as they can use a electron microscope to read the $1 trillion In God We Trust inscription.   But it has to be made out of platinum.  No other metal or substance, like a piece of pizza, will do.  The reason is that the Treasury has the right, by an obscure law, to mint platinum coins, but only platinum coins.  Otherwise, making money by making money is the Fed’s domain.

Countries that pay for what they spend by printing money or, these days, creating it electronically, are usually broke.  That certainly fits our bill.

Our country is completely, entirely, and thoroughly broke.  In fact, we’re in worst fiscal shape than any developed country, including Greece.   We have fantastically large expenditures coming due in the form of Social Security, Medicare, and Medicaid payments to the baby boom generations – I.O.U.s, which we’ve conveniently kept off the books.

When the boomers are fully retired, Uncle Sam will need to cough up $3 trillion (in today’s dollars) per year to pay us (I’m one of us.) these benefits.   To put $3 trillion in perspective, it’s 1.5 times Russia’s GDP.

These benefits are called entitlements because, presumably, we feel we are entitled to hit up our children to cover their costs.  Borrowing from them and letting them tax themselves and their kids to pay themselves back is a good trick, but it’s running afoul of the debt ceiling.  Taxing them more and promising to the pay them benefits they’ll never receive is an old trick that’s run its course.  So we’re now onto printing money that will, we hope, raise prices only after we have protected our assets against inflation.

And we’re printing lots and lots of money.  Indeed, over the past five years, the Treasury has, in effect, done its $1 trillion coin trick twice.

Come again?

Well, substitute a $2 trillion piece of paper called a Treasury bond for the platinum coin.  Suppose the Treasury prints up such a piece of paper and hands it to the Fed and the Fed puts $2 trillion into its account.  No difference right, except for the lack of platinum.

Next suppose the Treasury doesn’t hand the $2 trillion bond to the Fed directly, but hands it to John Q. Public who gives the Treasury $2 trillion and then hands the bond to the Fed in exchange for $2 trillion.  What’s the result?  It’s the same.  The Treasury has $2 trillion to spend.  John Q. Public has his original $2 trillion.  And the Fed is holding the piece of paper labeled U.S. Treasury bond.

Finally, suppose the Treasury does this operation in smaller steps and over five years, specifically between 2007 and today.  It sells, i.e., hands to John Q. in exchange for money, smaller denomination bonds, which Johns Q. sells to the Fed, i.e., hands to the Fed in exchange for money.   Further, suppose the sum total of all these bond sales to the public and Fed purchases of the bonds from the public equals $2 trillion.  Voila, you’ve got U.S. monetary policy since 2007.

In 2007, the monetary base – the amount of money our government printed in its entire 231 years of existence totaled $800 billion.  Today it totals $2.8 trillion.  And it increased by this amount via the process just described – the Treasury’s effective minting out of thin air two $1 trillion platinum coins.

Now what happens when the Treasury spends its freebee money?  It raises prices of the goods and services we buy or keeps them from falling as much as would otherwise be the case.  Either way, the money we have in our pockets or in the bank or coming to us over time as, for example, interest plus principal on bonds we’ve bought in the past – all this money loses purchasing power.  So we are effectively taxed $2 trillion.

What the advocates of the $1 trillion coin are, therefore, proposing is to tax us in a hidden way.  This is not just taxation without representation.  It’s also taxation with misrepresentation.   The fact that a Nobel Laureate in economics would propose this without making clear this fact raises the question of whether his prize should be revoked.  Lance Armstrong, after all, is losing his medals for discrediting his profession.  Perhaps the Nobel committee should consider taking back Krugman’s.

This is no innocent omission.  Every PhD economist is taught about seigniorage.  It’s a term that was coined (excuse the pun) in the 15th century and stems from the right of feudal lords – seignurs – to coin money, use it to buy, say, chickens and debase the purchasing power of the coins they had given their serfs in the past for, say, wild boar.

Today, 12 cents out of ever dollar being spent by our government is being printed.  As indicated, the money supply has more than tripled.  While inflation, let alone hyperinflation, has not yet occurred, everything is in place for this outcome.  If you want to see what things will look like, check out Zimbabwe, which has surely been reading Krugman’s articles.

Washington City police subject to monthly point system that looks like an awful lot like a quota system

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stgeorgeutah.com | Jan 8, 2013

by Joyce Kuzmanic

WASHINGTON CITY – An internal document outlining a point system for Washington City police officers is being characterized as a management tool that enhances the officers’ career development. But the system looks a lot like a quota requirement.

Point system measurements imposed upon police officers in correlation to the number of tickets they write or arrests they make have long been called “quotas” but agencies tend to decry the name “quotas” and are reluctant to publicize the practice.

(report continues below image)

Excerpt from Key Performance Indicators, Washington City Police Department | Screenshot Image by St. George News

Quotas are controversial because they raise public suspicion that law enforcement officers will dole out tickets by compulsion, for career advancement perhaps, and to meet budget needs of their city or state employers.

Both the systems and the names given those systems are subjects of argument and denial.

St. George News obtained a document and Public Information Officer Ed Kantor said by way of authentication that it was produced by Washington City Police Department’s case department management. The document, attached here, sets forth Washington City Police Department Key Performance Indicators.

Washington City P.D.’s Key Performance Indicators policy in summary

The Washington P.D. document sets forth a point system by which officers accrue points for specific actions:

– 25 points for self-initiated department programs / processes / procedures.

– 10 points for DUI arrests.

– 6 points for other arrests.

– 5 points for self-initiated public presentations.

– 3 points for traffic and misdemeanor citations.

– ½ point for written warning citations.

And the list goes on.

The policy sets minimum monthly point accrual requirements for Washington City’s police officers and suggests goals within several of the point-earning items. It enumerates evaluation categories in areas of policy, customer service and leadership. And it defines an accountability process through which officers meet monthly with their sergeants for performance evaluations predicated upon their point accrual and a series of remedial actions that may be taken should an officer flag in logging sufficient number of points. Remedies include discussion and counseling, written documented warning to increase performance and corrective action plan to deal with recurring issues.

Washington P.D.’s comment on its policy

The policy was developed for enhanced employee career development, Kantor said, with two main goals: (1) To measure an employee’s performance fairly and accurately through a process, to be able to be consistent through evaluation period to evaluation period with consistency, and (2) to supply the highest level of customer service possible to the citizens of Washington City.

These measures are ways to help an employee be successful

“And employees have to have a measure,” Kantor said, “it’s hard to do in law enforcement. These measures are ways to help an employee be successful; rather than just say ‘you never do anything, you’re fired,’ there has to be a process whereby supervisors and managers can help improve the career performance of employees.”

The policy provides the employee an opportunity to excel in law enforcement in areas in which they excel most, Kantor said. For example, if they don’t like writing traffic citations but they like making arrests, it helps them focus on where they want to go in their career, do they want to go into investigations? On the other hand, the system might show that an officer excels in writing citations and that might serve to encourage the officer to apply for a position in traffic division.

City of St. George Police Department’s comment on the point system policy

St. George Police Department’s Deputy Chief Richard Farnsworth said that St. George P.D. has nothing in the way of Washington City’s point system, as it was briefly described to him.

“We have an evaluation system but to put a standard of x number of citations, no,” he said.

We have no quota system, no reports system. We do not have a system where we assign points.

St. George has ways to track statistics overall – to keep crime statistics, to rate officers – but, Farnsworth said, “no structure that regulates performance. We have no quota system, no reports system. We do not have a system where we assign points.”

Quota or performance rating systems link to revenues

Point assignment systems suggest quotas and quotas suggest a correlation between the acts and the revenue – whether or not the policymaker calls it a quota.

In 2000, Utah’s Division of Wildlife Resources cooperated in a pilot “Performance Informed Budget,” a term the legislative committee decided on after debating other names for the pilot program such as “Performance Based Budget” and “Results Based Budgeting.” The Executive Summary of the report on that program includes the following statement:

“By whatever name, performance budgeting links appropriations to outcomes through the use of performance information in budget decision-making and the inclusion of performance indicators in the budget document.”

The DWR is a state agency that raises revenue through its own state police power and through less offense-oriented measures like application fees for hunting and fishing licenses. The 2000 report is detailed, itemizing, for example, application fees collected for a particular hunt over and above the number of licenses it allots to be issued for that hunt.

Whether it is the citing or arresting or licensing agency itself that draws the connection, or the state or city management under which it serves, traffic tickets, fines, application fees for hunting licenses, and the like all build revenue for the city or state. Is it likely that none of the powers that be are mindful of the connection or the tool that a performance measuring system offers in addressing budget issues?

In the future it is hoped there will be better linkage of budget recommendations to outcome measures, more performance targets

The executive summary of the 2000 DWR pilot Performance Informed Budget spoke directly on what it appraised as an advantage: “In the future it is hoped there will be better linkage of budget recommendations to outcome measures, more performance targets, and more time to focus on outcomes.”

A connection between Washington’s Key Performance Indicators and revenue goals was not something that Kantor would allow. He said, “the fines are levied by the courts, not the police. … To say that it is a budget line item doesn’t make any sense. We have nothing to do with the fines levied, amounts collected or how they are distributed.”

Similarly, St. George P.D.’s Farnsworth said, “Where we use the justice department, the Police Department does not see a return. Any revenue goes to the city. It comes to the city’s general fund. I can say our administration of this Police Department would not encourage enforcement for revenue.”

Both Washington’s Kantor and St. George’s Farnsworth agreed that officers should not be concerned with revenue building:

“The police are there to enforce the law,” Kantor said.

“None of those should be in the equation,” Farnsworth said, law enforcement “should not be based on economic factors; the right thing to do has to be in the interest of justice.”

Will Utah lawmakers intervene?

Concerns about quotas in law enforcement and the potential for negative consequences to the public by virtue of their connection to revenue building have led state representatives to entertain multiple bills over the years.

Introduced in 2000, 2007, 2008 and 2009, each of the separate bills sought essentially “to prohibit state and local governmental entities and law enforcement agencies from requiring or directing that their law enforcement officers issue within any specified time period a specific number of citations, complaints, or warning notices …”

Most of the bills failed in House committee or in the House, but one passed to the Senate in 2008, where it too failed and was returned to the House file. In other words, the bill was dead.

Fiscal notes by the Legislative Fiscal Analyst largely appraised the bills to have no direct, measurable costs to the local governments – which analysis may rebut arguments that quotas drive revenues and budgets drive quotas.

Except that, in 2007, the analysts’ fiscal note stated: “Any local entities currently using a quota system could see a reduction in the number of citations and related revenues.” Same office, why the difference in fiscal note?

a quota system – or “standard” as its then Police Chief Jon Greiner said

It may be because at that time, Ogden Police Department was receiving attention for its implementation of a quota system – or “standard” as its then Police Chief Jon Greiner said he preferred to call it.

According to a report by Cathy McKitrick published in The Salt Lake Tribune July 1, 2006, citation writing was one of several criteria then factored into pay raises for Ogden’s officers, and scoring points on performance evaluations was necessary to receiving pay increases.

Greiner opposed the succession of House Bills introduced by then House representative, Neil Hansen – representing Ogden – as did other police chiefs throughout the state, according to a report by Geoffrey Fattah, Deseret News, January 2007.

No similar bills have been introduced in Utah since the 2009 bill failed.

US ‘seriously’ considering $1 trillion coin to pay off debt

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A legal loophole means the US Treasury is able to mint a platinum coin and assign any value to it. Photo: Peter Macdiarmid/Getty Images

The US is “seriously” considering creating a $1 trillion platinum coin to write down part of its debt to stop the world’s largest economy defaulting as early as next month, according to financial analyst Cullen Roche.

A ‘Double Eagle’ gold twenty dollar coin is displayed at Goldsmith’s Hall in London. Nearly half a million of these coins were originally minted in the middle of the Great Depression in the US. Only 13 are known today after the rest were melted down before they ever left the US Mint, sacrificed as part of a strategy to stabilise the American economy. In 2002 a Double Eagle sold at auction for $7.6 million.

Telegraph | Jan 7, 2013

By Rebecca Clancy

Speaking to the BBC’s Today programme, Mr Roche, founder of Orcam Financial Group and blogger at Pragmatic Capitalism, said the idea was being taken “somewhat seriously” in Washington.

“I know it’s been spoken about at the White House and a number of prominent people, including congressman, are talking about it,” he said.

In theory the US Treasury would mint the coin and deposit it into its own account at the Federal Reserve, which would allow the government to write down or cancel $1 trillion of its $16.4 trillion debt pile.

The Treasury began shuffling funds in order to pay government bills after the country hit its $16 trillion debt limit on December 31. However, the Treasury’s accounting maneouvres will last only until around the end of February as the latest fiscal cliff deal gives US politicians two months to raise the debt limit before the country defaults.

The idea, which was raised last year, has been floated by several financial analysts in the States over recent days as Congress and the government approach the key fiscal vote.

Mr Roche said the idea was an “accounting gimmick”, but noted it was just “one really silly idea [being used] to fight another silly idea”.

“The idea of the US willingly defaulting on debt is beyond crazy,” he said.

“We started kicking the idea around a year ago and it was really a joke and the fact it’s become something sort of serious, well it’s a sad state of affairs that it’s become so dysfunctional in Congress that this is something we’re having to resort to.”

Writing in his New York Times blog, economist Paul Krugman, said that while he did not expect the Treasury to go ahead with this “gimmick”, there could be a case for it.

“This is all a gimmick — but since the debt ceiling itself is crazy, allowing Congress to tell the president to spend money then tell him that he can’t raise the money he’s supposed to spend, there’s a pretty good case for using whatever gimmicks come to hand,” he said.

Mr Roche also did not expect the Treasury to go ahead and mint a $1trillion coin, but said President Obama could use it as threat.

“I don’t think it’s something that will end up being used but I think that if it comes down to it we could potentially see the President use this as something where he says, ‘look if you’re going to threaten to default on debt then I’m going to threaten to use the coin loophole’.”

There are limits on how much paper money the US can circulate and rules that govern coinage on gold, silver, and copper.

But, the Treasury has broad discretion on coins made from platinum, and in theory, it is allowed to mint a platinum coin and assign any value to it.

However, it is worth noting that this was intended to issue commemorative coins and not as a fiscal measure, Mr Krugman said.