Our Government Doesn’t Do Things Affordably

by Rob Roper

Governor Scott gave a good inaugural speech this week echoing the voters’ call for “affordability” in the last election. “Vermonters told us – loudly and clearly,” explained Scott, “they expect us to get back on course; to spend within THEIR means; and above all else, make Vermont more affordable for them.” I think this sums it up pretty nicely.

My favorite anecdote from the speech involved someone named Travis, described as “a Harwood alum and Moretown resident, who rushed from work to a public meeting so he could tell whoever would listen, ‘I don’t live here. I survive here…. It’s too expensive. Straighten it out. Figure it out. And come up with a better system. Because the taxpayers are sick of it.’” Scott added, “And that, I believe, gets to the heart of the issue. Because he didn’t say slash and burn the budget. He said, do it better.”

I wish I knew who Travis was because I’d love a follow up to see if slashing and burning the budget was, in fact, what he had in mind as a path for “doing it better.” Yes, what our government does needs to be done more efficiently (according to WalletHub Vermont ranks 43rd for return on investment of tax dollars, and that’s really bad). But, perhaps more importantly, our government does way too many things inefficiently, and too often destructively. Slash those programs and burn them. Shrink the budget and lower our taxes. Travis, if you’re out there, did I catch your vibe correctly?

Here in Vermont government meddling in free markets is a leading cause of why so many aspects of daily life are more expensive than they are in other places or need to be here. A prime example is housing. The state severely regulates where housing can be built, and how. This drives up costs to build and limits supply by discouraging or outright blocking private investment in housing stock, further driving up costs. Having thus created a housing access and affordability crisis, our politicians step in again to “solve” said crisis by subsidizing “affordable” housing – with taxpayer money.

One such project underway as we speak is taking place in Berlin: the Fox Run Apartments. According to an article in Vermont Business Magazine, “Fox Run Apartments which will provide essential housing for 30 low- and moderate-income households in Berlin… [at a cost of] $15.1 million from a mix of public and private sources….” If things stay on budget, that’s an average of $503,333 per unit. Of “affordable” housing.

The real estate website Zillow calculates the average home value in Vermont to be $385,992. In other words, when government gets involved, it costs society roughly 25 percent more than the value of an average house in the marketplace to build a unit of “low to middle income” housing. That’s not affordable. That’s not sustainable. And since a low-income Vermonter cannot in the real world afford a half-a-million-dollar apartment, taxpayers will have to subsidize residents’ rents after the project is completed as well.

A similar dynamic is playing out with childcare. Back in 2015 the politicians in Montpelier passed regulations on childcare facilities that drove over a quarter of all small, private providers out of business within a couple of years. This decreased supply, which limited accessibility and drove up costs.

The idea was (and still is) to replace those privately funded, taxpaying businesses with taxpayer supported government-run services. So now, in addition to parents having to pay higher tuition rates for childcare, Vermont taxpayers were hit with the $125 million per year payroll tax to subsidize services in order to “solve” the crisis, and this was on top of a $76.1 million appropriation in FY24 to get the program off the ground. A supporter of this scheme was recently boasting on social media that Act 76 (the childcare payroll tax) has helped to create an additional 1000 childcare slots throughout the state.

Okay. Sounds good. Let’s do that math. The $76 million FY24 seed money plus the revenue generated by the payroll tax in FY25 (it went into effect last July, so six months in) should be around $60 million so far… that’s $136 million total spent to create, what did you say, 1000 childcare slots. Yup: $136,000 per childcare slot. Nope, not affordable. Not sustainable. This is why people can’t afford to live in this state, because this is what our elected officials think “affordable” childcare looks like. And a lot of families still can’t find space! Go figure.

This kind of thing is happening with healthcare, insurance, cars, energy policy…. Instead of allowing private investment to fund infrastructure and services based on popular demand and at prices people can afford without taxpayer assistance, our politicians think they know better and meddle on both ends of the equation. They drive up the cost of production at taxpayers’ expense, and then have to subsidize the purchase price – again at taxpayers’ expense. This is not efficient, effective or smart. Or, what’s the word, “affordable.”

If state government is really going to start to spend within OUR means; and above all else, make Vermont more affordable for US,” than this approach to governance needs to end. To quote Travis, “It’s too expensive, and we taxpayers are sick of it.” And the only way to make something that’s too expensive affordable is to make it less expensive. And how do you do that? Slash and burn. Judiciously, of course. Are you with me, Travis?

Author

  • Rob Roper

    Rob Roper is a freelance writer covering the politics and policy of the Vermont State House. Rob has over twenty years of experience with Vermont politics, serving as president of the Ethan Allen Institute (2012-2022), as a past chairman of the Vermont Republican State Committee, True North Radio/Common Sense Radio on WDEV, as well as working on state statewide political campaigns and with grassroots policy organizations.

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