Fingers in the Pie

Trey Smith

I went into my local township building Monday to settle up my local income tax bill. I had filed for an extension of my federal and state taxes back in April (call it my "Romney extension), because of my father’s unexpected death a few weeks before the tax filing date and the need to deal with his funeral and with arranging for care for my widowed mother, who has alzheimers, had taken up all my time.

I paid my local tax bill on time though, because at 1 percent of income it is a relatively small amount and was easy to get out of the way. I just made a rough estimate and dropped a check with the one-page form in the mail, figuring I’d settle the amount due after my federal taxes were completed. So, after finally getting my federal and state taxes done, I went to the town hall to settle up. It turned out I’d overpaid my local taxes by $165.

Ordinarily if I’ve overpaid my local tax, for example by paying too much in the four required estimated tax payments, the township simply applies the overpayment to my next tax year’s estimated payment. Not so this year. I was told that the collection of taxes by all the townships in Montgomery County had been privatized -- taken over by a private accountancy firm called Berkheimer Tax Administrator, a company expressly created to bid for outsourced collection operations of local towns, school districts and counties, for a fee.

The immediate problem for me resulting from this astonishing privatization of a fundamental local government activity -- the collection of taxes -- was that the local township office said they could not credit my overpayment as before. “Berkheimer is in charge of the money,” a township official told me, “and they will send you a check for the overpayment.”

“But that means I will be late in filing the first two quarterly estimated payments for 2012,” I said, adding, “but I’m really not late, because they already have my money!”

“You’ll have to call Berkheimer,” she told me. “We can’t do anything about it.”

After calling Berkheimer (and waiting through 15 minutes of listening to god-awful Muzak), I finally got a tele-clerk, who told me that there was nothing she could do. I would be issued a check for the overpayment, and would be charged a late fee for my late quarterly payments. She said I could write and explain about my father’s death and see if they could “do anything,” but she didn’t sound optimistic. I’m not either, and I sure don’t want to go through any more of those 15-minute Muzak experiences (which seem calculated to deter callers)!

I learned that for taking over the role of collecting my taxes for my local town, Berkheimer gets paid 1.39 percent of whatever taxes it collects. That’s a pretty cushy deal, given that nearly all of the local taxes collected ($6.4 million a year, in the case of my town), are automatically withheld by employers and then paid over to the taxing authority -- in this case Berkheimer. Talk about a cushy arrangement: $13,900 for every $1 million in taxes mailed in by employers! Even where it comes to self-employed taxpayers like me, it’s not a hard job. Send me a tax bill once a quarter, and book the check when I send back the payment coupon and a check.
~ from Privatization Madness: Now Private Companies are Collecting Our Taxes by Dave Lindorff ~

Yes, boys and girls, this is what privatization REALLY looks like: Government handing over basic services to corporations that reap big financial rewards for not having to do a whole helluva lot!!

It's happening everywhere as the oligarchs salivate at the next piece of the public sphere they can get their greedy hands on. Taxation. Prisons. Parking Meters. Food Stamps. And so much more.

Here, in the grand state of Washington, our elected leaders have handed the administration of our Food Stamp program over to J. P. Morgan. State workers still determine eligibility, but once you're in the system, J. P. Morgan becomes your daddy.

As I shared with you a few months ago, the state is no longer administering our Medicaid program. That too has been parsed out to several health "management" companies. The one I'm with -- I won't name it so I don't get in any trouble -- now manages the Medicaid program in 15 states. I bet their bottom line is growing at a phenomenal rate.

Regardless of who wins the presidency on November 6, don't expect the mass rush toward privatization to abate. As both candidates are beholden to corporate interests, neither wants to upset their best and biggest friends. Of course, we should continue to resist, but more and more we are in no position to halt it. Sadly, it's the wave of the future in the land of the "free"!