Wednesday, August 26, 2009

warning: not modifiable!

I keep missing out on government handouts. I think this means that I'm the benefactor instead. I only like using that word because it was in Great Expectations, which I didn't much like but seems to have stuck in my head along with a mental image of Miss Havisham in an old, worn out wedding dress.

Speaking of old and worn out... It seems that I haven't had a "hoopty" since I graduated college. My first car was really a '67 Mustang, but it needed work costing only $1200 that I saved about half of with my mom chipping in the rest. Said work prevented it from being an everyday car so I drove a '76 Ford Maverick. Then I got to driving the Mustang, but the driver's door never really worked well and I was a broke ass high school kid with limited tools. When I went to college, I sold it and went without for most of freshman year. Then it was a borrowed '85 Ford Thunderbird. Then I bought another '67 Stang, a little better than the first, but not much. I drove that hunk of junk for a few years. For the better part of 8 years, I drove a "clunker." Clunkers were the only cars I could: 1) afford, 2) afford insurance for. In a nutshell, clunkers made really good starter cars.

Those starter cars made me really appreciate the new car I bought as I was just about to graduate college and already had a job lined up, contract signed and all! I had a 30 mile round trip commute and the Mustang wasn't going to make the grade on that. But yes, I finally bought a new car. It was a sweet little 2002 Mercury Cougar. I loved that car. It was the first thing that I had bought with 100% of my own money, and it was brand, spanking new. It really made me sad that I had to get a new car for the new job last year (cargo space issues). I was heartbroken when the dealer only offered me $4000 for it after I had kept it up so meticulously. So I sold it on Craigslist in 2 days for $5500. That wasn't much easier.

But I'm getting off topic here other than ultimately getting around to lamenting the loss of 750,000 starter cars for the new drivers out there. All in the name of saving about a quarter of a day's worth of car exhaust pollution each year. If it even does that, now that these folks have a new hotness that they might end up driving more than they did the old and busted.

And to add insult to injury, I once again missed the free government money boat. I neither still owned a clunker nor desired to purchase a new car. So there's another $4500 in government behavior modification that won't be modifying much for me. So now, I've spent $7500 too much for my house and $4500 too much for my car. I think my two year total economic disadvantage to my peers is up to $12k if I'm any good at math. And I was feeling pretty good because one of my friends traded in a decent Dodge Ram diesel for the program this past weekend for the CforC credit. I could trick myself into thinking that my portion of taxes that went towards the program went into her new car! Then it turns out that a wholesaler bought the truck from the dealer for $4500 instead. At least it might end up being a good starter work truck for someone.

Friday, February 27, 2009

rectal probe 2008

My wife and I were dutifully subjecting ourselves to the annual rectal exam known in technical lingo as a 1040 this past Sunday. As you go through H&R Block's online tax preparation (let's face it, filling out the actual forms requires multiple Ph.D.s in finance so you have to pay for some help), you discover all sorts of new gems every year. But one this year was by far my favorite.

The first-time homebuyer's tax credit.

A little more research and it looks like if I had been a home purchaser somewhere between April 9, 2008 and Dec 31,2008 I would qualify for a $7500 tax credit, effectively lowering the cost of my home by $7500 dollars. And this year it is set at $8000 between Jan 1, 2009 and Dec 31, 2009. We do have to adjust that credit for inflation!

My mistake again was playing by the rules.

See? My wife and I purchased our home a few years out of college back in 2002. We bought a little higher than we were comfortable with at the time but we had reasonable expectations that our income would rise reasonably over the next few years being fresh out of college in high demand fields of study. Being graduates of an engineering school, we were okay at math and figured out that we could afford everything just fine. We would just be looking at blank walls for lack of significant funds for furnishing. We still have mostly blank walls, but that's because neither of us really cares about stuff like that.

There was no home buyer tax credit when we purchased. So it might seem that we paid $7500 too much for our house by not "timing the market," so to speak.

The term "tax credit" is misleading for those of us that itemize deductions on our tax returns. You might think that it lowers your adjusted gross income by $7500. It does not. It is a refundable tax credit. AKA wealth redistribution. If you broke even on your tax return before the credit, you would receive a check for up to $7500. Oh, unless of course you're one of the filthy rich with a $75k individual salary or $150k combined for married couples. Then it reduces quickly towards $0 when you hit $95k single or $170k married. Why married couples don't get double here is not explained.

So, effectively, I am now seemingly at a $7500 cost disadvantage to peers in society that just bought a house last year. Congratulations, you won the proverbial government lottery of behavior modification through tax code.

But I did say "seemingly at a $7500 disadvantage," didn't I?

Where did government get the $7500 from? It must be profits from the businesses that government owns and runs. Oh, they don't really have those? (yet, at least, until we nationalize the banks) Where is this magical land of candy and rainbows that created this $7500? Oh, here it is! It's in my pocket and it's called my wallet. Or more realistically these days, my bank account.

So those of you who can do math without a calculator will quickly realize that I am effectively now at a $15000 competitive disadvantage to those fortunate enough to have purchased a home at "the right time." It may only be $7500 on paper but I wasn't born yesterday. However, I'd be better off financially if I'd been born about six years later.

Friday, January 23, 2009

verticalizing the bell

A terrifying trend has become more apparent to me in recent months. I have been aware that our culture embraces mediocrity in a futile and misguided attempt to create "fairness." In other words, to let the meritless achieve more than they normally would while those with the credentials and talent are brought down a notch or two. Somehow this is seen as a justice and equality rather than the narrowing of the bell curve that it really is.

For a while there, it seemed like the only place where talent and ability could go unpunished was athletics and entertainment provided you aren't too unattractive. Well, as long as you're male. Let's face it. Most football players are fat and UGLY! But now it seems that even these endeavors are no longer exempt. A basketball team in Texas is now apologizing for winning their game against another team in a 100-0 rout.

Should the teams have been matched up for a game in the first place? Obviously not. The coach of the losing team is in some type of denial if he can't admit that he should have never agreed to this game. But should the winning team apologize for being a better team (if not superior)? Absolutely not. The coach might have let up after halftime, let's face it. But that's a coaching issue. It's not the school's problem. And it's most certainly not the players' problem for simply doing their job and doing it well.

Let the coach apologize for not offering a forfeit at halftime. But don't for one minute think that these girls have something to apologize for. Setting a high competitive standard and giving the other team a few goals for the future should be commended, not denigrated in the incorrect name of "fair play."