Effect on children’s wealth when parents move to Florida

Happy Bastille Day! Let’s look at the likelihood of kids being able to afford that trip to Paris…

Taxes weren’t a factor in our decision to relocate to Florida, but it is interesting to look at how a parental move to Florida can affect the wealth of children. I built a spreadsheet positing an already-sort-of-rich Massachusetts resident who moves to Florida 30 years prior to his/her/zir/their death (e.g., will live in Florida from 52 until 82, the median age at death of a COVID-19 victim here in Maskachusetts). The assumption is that this person will pay the top rates for any progressive taxation scheme. Since big numbers are tough to work with, I looked at the effect on the margin. The parent decides not to buy a $100,000 C8 Corvette (marked up from the $60,000 list price in our “no-inflation society” (TM)) and instead invests the money in the stock of a standard C corporation, to be saved for the benefit of the children. Keep in mind that this is a post-tax $100,000, which might have required earning $200,000 pre-tax (or, for those who prefer not to work, having sex with someone who earns a reasonably high income; see Real World Divorce for state-by-state child support profit calculations).

I started by assuming that the government isn’t lying to us and therefore use an inflation rate of 3 percent. If we assume real profits of 4 percent, that gives us a nominal return of 7 percent. The company pays 24.6 percent state and federal corporate income tax (Tax Foundation/OECD). We assume that these dividends are qualified and therefore a federal tax of 23.8 percent is due (20% plus Obamacare surtax). Maskachusetts income tax is 5 percent vs. 0 percent in FL. We assume that there is some way to invest these dividends and get a 5 percent annual return. When the 82-year-old is killed by Delta Epsilon Zeta variant COVID, Massachusetts estate tax takes 16 percent of the accumulated total while the Feds take 40 percent. Florida has no estate tax. Thanks partly to the miracle of compound interest and partly to the miracle of inflation, the $100,000 invested would have turned into $956,012 in a no-tax environment. In the Florida environment, however, it turns into $391,526 at death. In the Massachusetts environment, $275,287. Children end up 42 percent richer if the parent moves.

(You can check my calculations in this Google spreadsheet (downloads in Excel format; also available as a Web page).)

What’s the effective tax rate? In “I Can Afford Higher Taxes. But They’ll Make Me Work Less.” (NYT, 2010), Harvard professor Greg Mankiw calculated the total marginal tax rate on additional earnings for him was 90 percent (assuming that his goal was to help out his children). If we look the profits in nominal terms, subtracting the original $100,000 investment, we find that there was $291,526 profit in Florida compared to $856,012 in the no-tax case. Florida didn’t take anything, but the Feds and maybe some states via corporate income tax took 66 percent. In MA, the nominal profit was $175,287, resulting in a tax rate of 80 percent. What if we look at this in real terms, though. The $100,000 would have grown to $242,726 just from inflation alone. If we subtract this from the MA net of $275,287, the result is a total tax rate of 95 percent, since the real after-tax profit was only $32,561. The tax rate for the Florida residency case comes up to 79 percent of real after-tax profits (again, because of Federal taxation, not because Florida has an income or estate tax).

What if we assume the same real return on investment for corporations, but set inflation at 8 percent and therefore nominal earnings are 12 percent? The effective tax rate for a Floridian is remarkably stable, moving up to only 81 percent (from 79 percent). The effective tax rate for the person who lives and dies in Massachusetts, however, is 98.6 percent. (See revised spreadsheet (or as a Web page).)

What if the parent is a genius at picking stocks and he/she/ze/they selects only those with 8 percent real earnings (11 percent nominal)? The numbers are fairly stable, with the Florida corpse being worth 43 percent more. The Massachusetts real tax rate falls to 88.5 percent (from 95 percent).

Loosely related, a statute celebrating the “world’s first commercial airline flight,” which operated from St. Petersburg to Tampa beginning in 1914. The airline was started by Thomas W. Benoist, who died in an accident in 1917… stepping off a streetcar.

Wikipedia says that the signs should be amended to read “first fixed-wing scheduled airline” because the Germans were operating Zeppelins earlier. (The photo is from the St. Petersburg Pier, June 2021.)

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Fireworks anxiety supplants Coronapanic for one weekend here in Maskachusetts

We were out on the highway over the July 4th weekend for a quite-possibly-illegal visit to New Hampshire (“Live Free or Die” on the license plates, but the state was about average in terms of restrictions on residents justified in the name of COVID-19 (ranking)).

For 16 months, Maskachusetts has used its enormous highway signs to hector residents regarding the need to wear masks and/or the need to go through an elaborate online process to reserve a vaccine (it is apparently too challenging to run a vaccine clinic at a rest stop and change the sign from “go to a URL” to “go to a rest stop”). Over the July 4th weekend, however, the signs were changed to hector residents residents regarding the potential of imprisonment and/or fines if they set off fireworks (even sparklers are illegal in MA). A few days later, the signs were back to telling residents to visit a URL to begin the process of ascending into the ranks of the vaccinated.

From a ski resort in NH:

Sabbaday Falls after the big rain:

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Lockdown advocates now object to restrictions on open-water swimming

Massachusetts Governor Charlie Baker has decided to protect residents against the dangers of open-water swimming. “Swimmers Frustrated By New Ban On ‘Open Water Swimming’ At Walden Pond” (from state-sponsored NPR-affiliate WBUR):

The state’s decision to ban open water swimming at Concord’s iconic Walden Pond is eliciting a quick and irate response from swimmers.

The Department of Conservation and Recreation announced Friday that swimming outside of designated areas at Walden would be prohibited “indefinitely.” In a statement, the agency said the decision was made “in order to simplify and standardize education and enforcement” across all state-regulated bodies of water and to “protect public safety.”

The legislation follows a series of drownings in Massachusetts, including a 19-year-old who drowned Thursday swimming off South Boston’s Castle Island.

An open letter to the state purporting to represent “the open water swimming community of greater Boston” had collected more than 400 names before it was converted to an online petition, where it gathered thousands more. The letter claims the Walden ban “infringes on our reasonable right to access the natural assets of our state,” and proposes instead that open water swimmers should be allowed as long as swimmers use safety devices known as swim buoys.

11,058 of the Massachusetts righteous have signed a petition at change.org seeking relief from this latest governor’s order.

What’s interesting about this? The folks whom I know who signed the petition were enthusiastic lockdown advocates. They cheered when Governor Baker closed the schools “to keep kids safe” from a disease that had never killed a child in Maskachusetts (0 deaths among under-20s in MA through August 11, after which the state withheld deaths-by-age data from the public). Now, however, the Lockdown Karens object to Governor Baker using #Science and his newly unlimited powers to deal with a very real danger (Dr. Jill Biden’s colleagues at the CDC say that roughly 4,000 Americans drown annually.)

An October 2008 aerial photo of Walden Pond. The sandy beach at left is where Governor Baker orders you to swim. The area near the railroad tracks on the right (which went quite close to Thoreau’s cabin back in the old days) is where the open water swimmers used to risk death.

On a separate note, and it may be too soon to wonder this, but why are Americans so interested in the Champlain Towers South collapse, in which roughly 140 lives were lost? We are informed that 600,000 Americans were cut down in their prime by COVID-19. These folks, who had their best years ahead of them, went from the tennis court and soccer pitch to a ventilator in the ICU to the morgue. On June 24, 2021, when the Florida condo collapsed, we are informed that 355 young healthy Americans fell to COVID-19. If COVID-19 kills unpredictably and indiscriminately, like a building collapse does, why would we have time and energy to mourn building collapse victims who are so greatly outnumbered, even on the day of the collapse, by COVID-19 victims?

A January 2021 photo of Normandy Isles and North Beach with Surfside just beyond. The collapsed building, from this perspective, is just behind the first tower to the north of the park (green area along the beach).

(For the record, I personally am sad about the victims of the Champlain Towers South collapse partly because I do not believe that COVID-19 has killed hundreds of thousands of healthy Americans who had a lot of great years to look forward to, whereas I do think that the collapse killed healthy people who could have lived enjoyable active lives for years or decades to come.)

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Helicopter snaphots

We’re flying with the doors off the Robinson R44 in order to avoid being baked to death in the recent weather (over 90 degrees in God’s chosen system of units). That enables your humble instructor to snap a few iPhone 12 Pro Max photos from the left seat.

On the ramp at our local airport (KBED), the F-18s that Joe Biden recommends for personal ownership (try to get a friend to pay for fuel, though!):

See if you can spot the Black Lives Matter banner on the all-white church in the all-white town of Concord, Maskachusetts:

The Concord-Carlisle High School, a $93 million project (about $71,000 per student, half paid for by the state) that taxpayers wisely decided not to use for a year (#AbundanceOfCaution; it was closed entirely for 6 months and then students were able to start attending half time):

The Lincoln K-8 school, a $110 million project, including the solar panels that were borrowed against in an off-books accounting maneuver, ($250,000 per student, 100 percent paid for by the town):

(This is being done as an in-place renovation, with students displaced to trailers for three years, because the campus supposedly does not have enough room for the usual “build new building in parking lot or on soccer field, then demolish old one” process.)

One of the families whose next 30 years of property taxes will fund the bond for the above. #InThisTogether:

(Imagine the legal fees if the “dependent” spouse “pulls a Melinda” and sues the spouse who earned enough money to build the above house! The happy plaintiff can beat the heat with Tinder dates by the pool.)

Mitt Romney’s legacy, the Mormon Temple in Belmont, MA:

Put on a mask and let your cows and sheep graze for free on Cambridge Common:

MIT Lincoln Lab:

Scroll to 1970 on the timeline and you’ll see that the Mode S transponder that is the building block for ADS-B was developed here.

Why can’t you get a seat on the Red Line trains that run every 10 minutes starting at Alewife? Check out everything that has been built recently near the station (center right of frame):

(the three red brick towers in the foreground are public housing (777 units for the worthy poor: “the towers—like many high-rise housing projects of the era—quickly became associated with crime… the complex is still a focus for law enforcement activity, and in 2008 the Cambridge Police opened a substation at the towers”) and, until a few decades ago, were the only significant buildings)

The Gropius House in Lincoln (cost about 4X/square foot to build as a typical house of the time):

A helicopter CFI gets current. We went to downtown Boston to get away from some light rain showers at Bedford:

It is a little unnerving to be using one’s phone as a camera through the open door of a helicopter. Lean out too far into the 90 mph breeze and it will be time to visit the Apple Store (don’t forget to make a COVID appointment, buy a mask, and get temperature-screened!). Maybe a case with a strap?

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PODS versus PACK-RAT for moving and storage

For the move from Massachusetts to Florida we decided that it would make the most sense to use at least two containers and a dumpster. Container A for the apartment we’re moving into. Container B to a storage facility near the apartment for eventual delivery to a house when we become stupid enough to purchase one. Dumpster for everything else.

We looked at the market leader, PODS, first. They wanted $4,770 per container (16x8x8′) for the move and $265/month per container for rental or storage. The container is wood, steel, and fiberglass and can hold up to 4,200 lbs.

PACK-RAT does not have as large a service area, but they cover West Palm Beach and Boston. The container is the same size, but all steel, like a standard container for a container ship (suitable for jamming into the Suez Canal!). The price for the container/storage is about the same, but they’ll move three containers to Florida (all fit on one truck) for what PODS charges to move two.

A typical cluttered house will require three containers. We’re hoping to trash a lot of stuff, but we also have some aviation gear currently stored in hangars.

Related:

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Can public schools suspend students who go away for a weekend and aren’t able to arrange a COVID test?

Keeping a child from attending public school is a crime. Parents can be arrested and imprisoned for obstructing a child’s access. See, for example, “The Story Behind Kamala Harris’ Truancy Program” (NPR):

In 2019, HuffPost reporter Molly Redden wrote about the families affected by this truancy program, including a Black mother named Cheree Peoples, who was arrested in April of 2013. She came on the show to help explain why this program, which initially launched without much criticism, ended up becoming so controversial, and why it disproportionately affected families of color. Here’s the extended cut of our conversation, which has been edited and condensed for clarity.

Cheree is a mother in California, and her daughter has a chronic illness. Her name is Shayla, and she has sickle cell anemia, a really painful genetic disease that causes lots of complications. It’s pretty typical for people who live with this disability to miss a lot of school if they’re children. As her daughter missed a lot of school for valid medical reasons, Cheree and the school were in a dispute about how to accommodate and account for those absences.

She was in her house one morning, and the police showed up and handcuffed her. She had time to put on a jacket over her pajamas. And when she was walked by the police out of her apartment where she lived with her daughter, there were news cameras waiting, and she was booked by the police. What she said to me was that she was shocked. She was really floored. And she said to me, “You’d swear I’d killed somebody.” It felt to her like a really excessive show of force for what was essentially a misunderstanding between her and her child’s school.

[Harris] fought for this law, which raised the financial penalty and made it a criminal misdemeanor for parents, up to a year in jail, when their children missed at least 10 percent of school time.

Here in Lincoln, Massachusetts, soon to be home to the nation’s most expensive (per student) public school building, the school bureaucrats decided that students could be excluded from the building (i.e., suspended) if they went away for a Saturday overnight in another state, e.g., neighboring New Hampshire or Vermont, and did not have a negative PCR COVID-19 test result to show. As with the former state governor’s order (one of 69), the test had to be taken within 72 hours of returning to Maskachusetts. So, in a twist that only students of the absurd can appreciate, it was legal to be tested for COVID-19 on Thursday evening in MA as a way of determining if someone was going to acquire COVID by traveling on Saturday morning and returning Sunday evening.

Although the school had a fully remote option, a student kicked out of school for quarantine could not transition into the fully remote option for the period of suspension.

The governor’s order was eventually dropped, replaced by an “advisory”. The school, however, continued with their requirement that, essentially, students be tested prior to departure for weekend excursions. They’d been running a “pool testing” program at the school as well, but the pool test could not be used to meet the travel requirement. So a student who was going to go to Vermont for the weekend would end up needing two COVID-19 tests in the week prior (to see if the student acquired COVID-19 in Vermont?).

Not every family can get organized for these tests nor afford them (we spent a month without insurance and we got billed $750 per child for a test at a “doc in a box” urgent care center). Perhaps a test goes awry and a result is never returned. For whatever reason, a child may end up over the border into another state (almost any of which actually have experienced far less COVID-19 than Maskachusetts; Florida, for example, adjusted for population over 65 is at roughly 1/3rd the MA death rate) and later have no test result to show. Why is it legal to deny this child an education for a two-week quarantine period?

#BecausePublicHealth? Maybe that was a good answer when the governor’s travel order was still in place. Now that the technocrats have rescinded their order, however, what is the school’s justification for denying education to children, a criminal offense if parents had done it?

Related:

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You can sit on top of each other, but wear a mask

Part of an email from the local public school here in Maskachusetts….

To assist you in planning, our bus protocol for the fall includes:

  • All students/drivers will wear masks on the bus
  • Windows will be open at least one inch
  • No social distancing will be in place
  • Seats will be assigned

(i.e., the exact opposite of WHO advice prior to June 2020; even the simplest mask will stop an aerosol virus and therefore you should feel comfortable in a crowded indoor environment)

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Shopping in Concord, Massachusetts: Bring your Mask

“In consideration of the health and safety of our employees and guests who have not been fully vaccinated, Masks are Required AT ALL TIMES Inside the Cheese Shop.”

Vaccinations have been widely available for two months here in Maskachusetts. There will always be those who aren’t vaccinated, however, either because they #DenyScience, have an unusual medical situation, are infants (though maybe the vaccine can be given right as a baby is coming out?), etc. Therefore, doesn’t this sign translate to “masks now, masks tomorrow, masks forever”?

#AbundanceOfCaution was the general rule for the shopping district. Although the governor’s 69 orders no longer require masks, the merchants have stepped in with their own unconditional mask requirements:

The ultimate expression of caution is to close the retail store altogether:

All photos from June 8.

A few sights on the way to/from this shopping experience… a group of preschool children, age 2 and 3, marching outdoors in masks. It was 93 degrees out. A neighbor with a zoning-minimum 2-acre lot (welcome the undocumented so long as they can afford a $1 million vacant lot on which to build a $1 million structure) riding a lawnmower… in a surgical mask.

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Sacrament of Masks preserved at the Apple Store

The Church of Shutdown abandoned the Sacrament of Masks, at least for the vaccinated, here in Massachusetts at the end of May. The ritual is kept alive at the Apple Store, however. From the Burlington Mall, today:

Things are quieter at the Microsoft Store and Lord & Taylor (both closed):

Adjacent parking lot (Burlington, MA is 3.3 percent Black, so Black Lives Matter… mostly in other towns):

Although masks are now merely “advised” (only for the unvaccinated) rather than required by governor’s order, more than half of the folks in the mall and at a nearby supermarket were masked.

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Maskachusetts unmasked

We risked death-by-variant-COVID-19 today at the Watertown Mall, meeting friends for dim sum. Although the Massachusetts state of emergency persists at least until June 15, a combination of 69 governor’s orders as of yesterday boiled down to “masks are no longer required indoors”. (Or at least, “you can’t be arrested or fined under state law for not wearing a mask indoors”; maybe a city or town could order you to wear a mask.)

I would have expected an enterprise that makes money from inviting the public to share an indoor space to deemphasize the risk of sharing an indoor space as soon as that deemphasis was legal. To the contrary, however, the shopping mall operator and some individual stores had kept up their sign barrage. We walked by at least 40 COVID-related signs between the door to the small mall and the restaurant itself (waitstaff still fully masked). How does this help their business? Wouldn’t an intelligent person who believed all of these signs decide to stay home and order everything from Amazon rather than take the risk of in-person shopping?

A sampling:

The mall includes a Target and 100 percent of the shoppers whom I observed were masked, both in the Target and in the rest of the mall.

I asked two of our (adult) friends how many COVID signs they’d walked past in getting from their respective cars to the restaurant. Both answered “none”. One was sufficiently mindful of COVID-19 that he arrived in a double-mask (fabric over N95) while the other sported a plain N95 mask. Yet their minds hadn’t registered the signs.

Note that the public health experts who have technocratically managed the Massachusetts plague such that our COVID-19 death rate, adjusted for population over 65, is only 3X that of Florida’s (a Robert S. McNamara-style victory?), still advise subjects to wear masks, especially for those who are not vaccinated.

(A few days ago we went on a bicycle ride with the kids in a quiet exurb. Slender apparently health people aged 10-20 would jump off the sidewalk in order to maintain at least 10′ of distance and if they weren’t already masked would rush to raise up their chin diapers.)

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