I hate to say "I told you so," but I did.
Early last year, I warned in Isthmus of an impending collision between property-tax-paying homeowners and property-tax-spending government, due to the economic downturn and collapsing home values ("Housing: The Hurt Is On," 5/9/08).
Now it's here and, before it gets better, it's going to get worse.
In a recent National Counties Association survey, 76% of large counties said falling property tax revenue is having a significant impact on their budgets.
Some states are seeing property tax revenue fall for the first time since World War II, and many states, including Wisconsin, are struggling with multi-billion-dollar deficits and declining revenue.
Local governments are being inundated by homeowners who are either appealing their property assessments or asking tough questions about why their property tax bill is going up when their home values are going down.
Those who thought we were at the bottom of the fall in real estate values were shocked when Deutsche Bank released a report in mid-June predicting home prices in the metropolitan New York City area will decline another 41% from first-quarter 2009 levels.
That same report predicts home values nationwide will fall another 17% before they hit bottom. If this happens, the total collapse will be around 40%.
Fortunately, home values in Wisconsin and Dane County have not fallen as precipitously as in overinflated housing markets elsewhere. But the downturn is clearly hurting the local housing market and units of government that depend heavily on that tax base for operating revenue.
America has shed two million jobs since Obama took over the presidency; official unemployment is heading north of 10%, with some studies putting the real unemployment rate as high as 20%. Ongoing massive federal debt is the stalking horse for hyper-inflation. And Vice President Joe Biden has finally admitted that the Obama administration "misread how bad the economy was."
This is the same Joe Biden who said a few months ago the Obama administration had a 30% chance of "getting it wrong" on the economy.
Those who opposed the $787 billion "economic stimulus bill" passed by the Democratically controlled Congress earlier this year because the bill didn't do enough to promote economic development and create jobs will take little comfort from Biden's candid admission, particularly when there is talk among some in Congress about a new economic stimulus bill.
Apparently the Democrats' first stimulus package - with its unwarranted intrusion of the federal government into the private sector - didn't do sufficient damage.
But perhaps the most troubling aspect of Biden's "misread" comment is how disconnected it shows Washington to be from what's going on in the country.
Despite all the happy talk flowing from Disneyland on the Potomac, most Americans are hurting. The situation in urban areas like Detroit (where the median home sales price is now reportedly $5,800) is downright desperate. Detroit is living the Great Depression all over again. Will the rest of the nation follow?
Clearly the strategy of spending our way out of recession and borrowing our way out of debt has exploded in the face of those who sold that snake oil to American taxpayers.
We would be better off canceling the current stimulus schemes, sending people in Washington to Argentina in search of their soul mates, and letting the marketplace correct itself. It's a better plan than anything coming out of Congress and less likely to cause more damage.
The real danger is that, if the disconnect between the people and their leaders continues to grow, so will the frustration and anger. Any serious student of history knows that severe economic stress and alienation of the governed from their government is fertile ground for the seeds of revolution.
As Thomas Jefferson wrote in the Declaration of Independence, "We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. Whenever any form of government becomes destructive of these ends, it is the right of the people to alter or abolish it, and to institute a new government...."
Indeed, he said, "it is their right, it is their duty, to throw off such government, and to provide new guards for their future security."
I do not count myself among those who would advocate the overthrow of the United States government, and most "revolutions" occur at the ballot box, not in the streets. But I do think those who have been granted the trust of the public would be well advised to remember how seriously Jefferson took the right and duty of the American people as it pertains to the structure of the government that flows from the consent of the governed.
Rick Berg (email@example.com) is a Madison-based writer and commentator.