by David Chapman and Karen Brune Mathis
Staff Writers
Jacksonville has been the “the Walmart of cities,” Mayor John Peyton said Friday, and how leaders choose to brand it for the future is still to be decided.
“We’re very good at being the cheapest,” said Peyton, discussing the City’s property tax rates.
Peyton made the comparison at the “Jacksonville: Choosing a Future” forum during his presentation about budget challenges, comparative taxes and potential economic growth areas.
The low tax burden is a benefit to taxpayers but a hindrance to balancing the budget and improving substandard funding levels for quality of life, such as parks and education, he said.
Peyton cited a 2009 study presented in the Kiplinger Finance magazine that showed Jacksonville with the sixth lowest tax burden in the nation, along with a chart that showed Jacksonville with the lowest millage rate among major Florida cities.
The forum, held at the University of North Florida, focused on how Jacksonville will progress. It featured Peyton and Greg Ip, U.S. economics editor at The Economist magazine, who detailed local and global factors, respectively.
Despite funding challenges, Peyton advocated for port expansion along with military and health care as Jacksonville’s potential growth areas, although he believes there is a clear-cut favorite.
“The port is No. 1 and there’s not a close second,” he said. “It’s an opportunity most cities would love to have.”
Budget challenges will determine how competitive Jacksonville is, both nationally and internationally, said Peyton, but the “single biggest threat to the future” is a work force facing educational issues.
Before Peyton’s presentation, Ip gave a broader perspective of the present and future economy on the global scale. Those communities that will grow faster, he said, will have a focus on education and a vision of international business.
That means less reliance on industries limited in scope, such as homebuilding, he said, and more focus on exporting customer and professional and services and culture and entertainment.
He said countries like Brazil, China and India continue to grow and he used the hit movie “Avatar” as an example of international consumption, citing 70 percent of the movie’s sales coming abroad.
The housing market bubble affected growth-dependent states such as Florida worse, said Ip. Every new job created was offset by a loss in the industry.
As for home prices being a factor in economic recovery, it’s not so much that prices increase, he said, as it is they stop decreasing.
The recession seems bad now, said Ip, because the economy was “so good for so long.” The U.S. isn’t alone in its economic woes and the economy is growing, but unemployment rates are still the biggest concern.
Signs such as fewer unemployment insurance claims are encouraging, he said, but the sluggishness and de-leveraging cycle generally takes around seven years, which would mean a stronger economy sometime around 2015.
“Just hold on,” said Ip. “The good news is coming.”
Late Friday afternoon, Ip discussed “The Deficit and Recommendations of the Deficit Commission” with about 80 members of the World Affairs Council of Jacksonville and The Gate Governors Club at The River Club Downtown.
Ip then returned to Washington, D.C., but the council and club members analyzed his insights over dinner and reported their summaries and deficit-reducing recommendations.
As one participant said, however, “It’s a lot easier to make decisions when you don’t personally have to take the hit.”
Observations and recommendations included:
• In reducing the national deficit, “Everyone seemed quite willing to make some sacrifice, as long as it’s fair.”
• Shared sacrifice is necessary. “It’s the people in the middle who carry the load for the rich and the poor.”
• The age to receive Social Security benefits needs to be raised and there should be a means test for recipients to draw benefits.
• “Defined benefits need to go the way of the mongoose and there only should be 401(k)s.”
• The health care and insurance systems need to be reformed, including tort reform.
• In health care payments by government, focus on medical outcomes. “We need to stop paying (medical providers) to do things but rather for what they’ve done.”
• Raise some taxes: Gas taxes, luxury taxes, sin taxes and the estate tax; eliminate subsidies for farms but eliminate estate taxes on them, too.
• Enact a “Whopper tax” to encourage wellness.
• “One thing that comes to mind is all elected officials live under the same rules as the people who elect them.”
• Term limits are needed for all elected officials.
• A lot of companies have cut their budgets by 25 percent or more, so the federal budget should undergo the same.
• Tax bills should be itemized to show where the taxes will be spent.
• “Government needs to be there to regulate but not over-regulate.”
Jacksonville Business Journal Editor John Burr, speaking for the participants at his table, focused on what Ip said earlier that evening, which isn’t that there is an inability by leaders to cut the deficit but rather a political unwillingness.
“It’s not difficult to come up with ideas,” said Burr. “But who in Congress really has the guts to take these issues and run with them?”
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