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Georgia editorial roundup

December 31, 2014

Recent editorials from Georgia newspapers:

Dec. 29

Morning News, Savannah, Georgia, on tax exemption for farmers:

Back in 2012, the Georgia General Assembly tried to do a good deed for Georgia farmers and boost the state’s economy, which was struggling to emerge from a deep recession.

Lawmakers passed House Bill 386, which, among other things, included the Georgia Agriculture Tax Exemption, which broadened the sales tax exemptions for the agriculture industry on equipment and business inputs such as seed, fertilizers, feed and more. The expanded exemptions went into effect Jan. 1, 2013.

However, according to the Georgia Municipal Association, these exemptions have siphoned money from the budgets of many rural Georgia county and city governments. Some of these counties — Long, Montgomery, Treutlen and other small counties with large agricultural bases — showed a drop of 15 percent or more in local government sales tax revenue in 2013 compared with 2012.

GMA attributes the revenue decline directly to the agriculture tax exemption.

To benefit from sales tax exemptions, those in the agriculture industry must apply for a Georgia Agriculture Tax Exemption card. According to an Atlanta Journal-Constitution story in October, more than 32,000 GATE cards have been issued and only 28 applications have been denied.

Qualified agricultural producers who earn at least $2,500 a year farming or in an agriculturally related business are eligible for the card. The cards may be used to obtain tax exemptions on items such as tractors, chainsaws, hoses, ice, fencing, machine parts delivery trucks and a variety of animals sold for breeding.

Critics of the exemptions say the program has not been audited, and they point to reports of program abuse that have reached all the way to Agriculture Commissioner Gary Black and Gov. Nathan Deal.

One report said a man purchased $100,000 worth of plywood that was supposed to be used to build a barn. Instead, he built a house. Another report had a man buying custom-made granite countertops for his new farmhouse. Yet another report said a woman in Hall County bought kibbles for her five cats.

If even some of these reports are true, the legislature should take another look at how decisions are made as to what items are included in the exemptions.

We aren’t necessarily interested in ending these tax breaks. That would be tantamount to a tax increase for the agriculture industry, and that wouldn’t be smart right now, particularly since the state’s economy is showing signs of some strength.

A better idea would be to revisit some of the details of the exemptions and maybe take a look at strengthening the oversight for the program. We’d like to think that Agriculture Commissioner Black and Gov. Deal would get behind any move to eliminate abuse in a program that is an incredible benefit to the state’s agriculture industry.

And then, of course, there is the issue of how the exemptions impact the revenue bases for Georgia’s rural cities and counties.

The Georgia Municipal Association issued a report in the fall detailing the impact of the agriculture tax exemptions on all 159 counties in the state for the 19-month period from February 2012 to September 2014.

That reports shows that counties bearing the brunt of the revenue shortfall are mostly in central and south central Georgia. Chatham, Effingham and Bryan counties, by the way, appear to be minimally impacted.

The report says tax revenues for local municipalities are being “whittled away” by these agricultural exemptions. The GMA says that “as a direct result of the exemptions included in the 2012 tax reform package (HR 386), areas of the state with a large agriculture industry base show a greater decline in sales tax revenues than areas with greater diversity of industry.”

The report goes on to say that “even as local governments came out of the recession and experienced increasing sales tax collections from 2010-12, the impact of the 2012 sales tax exemptions has canceled out increases in net revenues, and in many cases, has resulted in a loss to net revenues.”

Because of the popularity of H.B. 386 in 2012 (it passed the Senate 54-0 and the house 155-9), we know it’s not going anywhere. But just because it is popular, doesn’t mean the agriculture tax exemption portion of the bill doesn’t need some work.

When the legislative session begins in January, we hope our leaders will take a look at it.




Dec. 28

The Telegraph, Macon, Georgia, on the economy:

All indications are that 2015 will be the year when the pall that has overshadowed our economy will finally lift. The Great Recession, starting in 2007, hit the world hard -- and while European countries remain in the doldrums, the American economy is pulling itself up by the bootstraps of consumer spending. The U.S. National Bureau of Economic Research states that the recession ended in June 2009. While that was really good, it didn’t match the mood of the country and didn’t inspire consumers to spend. Rather, they stayed in hoarding mode. However, today there are good signs all around, the main one is the price of gas.

In 2007, gas prices for regular unleaded started to rise from $2 a gallon to $4 a gallon by midyear 2008. Prices have fallen in the last month from $2.62 to -- at some locations in Middle Georgia -- to $2.08 a gallon, and it’s still falling. Forecasters say low gas prices will be around for a while.

The low fuel prices are good news, at least for America, on the international stage. Russia, Venezuela, Iran and ISIS depend on high oil prices to fuel their economies. Crude oil that was going for more than $100 a barrel near the beginning of 2014, according to the New York Mercantile Exchange, hit $57 in mid-December. Low oil prices may make Russian President Vladimir Potin put his shirt back on. According to the Associated Press, the ruble has been the worst performing currency this year along with the Ukrainian hryvnia, having lost nearly half of its value against the dollar.

Unemployment is another bright spot. In January 2009, 10 percent of the American workforce was unemployed, according to the Bureau of Labor Statistics. Unemployment remained at or near that level until January 2011 when it started a gradual descent. The unemployment rate, as we head into 2015, is 5.8 percent. Georgia’s rate remains above the national average at 7.2 percent, but in the Metro Macon area, the unemployment rate is 6.9 percent and according to the Georgia Department of Labor, the area added 1,200 jobs in November.

Wall Street has recovered nicely from its low point in March of 2009 when the Dow Jones Industrial Averages dipped to 6,600. The Dow now sits at more than 18,000. And government statistics show that we are experiencing the fastest rate of growth since 2003 and the inflation devil is nowhere to be found.

Our New Year’s wish for our country is that we continue to grow and regain the prosperity so many had lost since 2007. Maybe the long winter of our discontent is finally over.




Dec. 30

The Augusta (Georgia) Chronicle on Afghanistan:

A flag-lowering ceremony in Kabul this past weekend signaled the official end of Operation Enduring Freedom - America’s 13-year war on terror in Afghanistan.

But the reality is that the war is not over, and Americans shouldn’t act like it is.

Though al-Qaida, the architects of the 9/11 attacks and other terrorist plots, has been partly dismantled and the Taliban is a shadow of its former self, extremism still has a foothold in the war-torn nation.

Barbarians hoping to keep the nation stuck in the Dark Ages already have been emboldened by America’s drawdown. Taliban spokesman Zabihullah Mujahid referred to the weekend flag-lowering event as a “defeat ceremony” and vowed the insurgents’ fight would continue.

Afghanistan, as a nation, is not yet in a position to stand on its own. The country’s fledgling government remains mired in corruption, and its national economy is almost entirely dependent on foreign aid and illegal drug exports.

Unless the United States wants to see the country go the way of Iraq - overrun by extremists after a full U.S. withdrawal - the American people and their leaders should steel themselves for a long-term commitment to establishing peace and stability.

And, really, shouldn’t that be the ultimate sign of victory?

Anything less would practically guarantee Afghanistan’s return to a robust terrorist haven within a decade.

Recall that it took less than five years for the Taliban to fill the vacuum left by the Soviet Union’s withdrawal from Afghanistan in 1989. A complete withdrawal by U.S. and NATO forces would create a similar opportunity for extremists to exploit.

What a dreadful end to a war that cost 2,200 American lives and $750 billion.

That’s why the United States isn’t cutting out of Afghanistan, just cutting back.

The task of stabilizing the country - part of Enduring Freedom’s transition to Operation Resolute Support - may prove to be every bit as difficult as the decade long struggle to root out terrorists and push back insurgents.

About 11,000 U.S. forces and 2,000 NATO personnel will remain in the country to advise Afghan forces, a substantial amount but far fewer than 140,000 troops in country at the operation’s peak in 2010.

The Status of Forces Agreement between Afghanistan and the United States gives the Afghan army the option to enlist the help of coalition forces when needed, so combat and counterterrorism missions are still on the table for American troops when times get tough.

President Obama, who vowed to end America’s wars in Iraq and Afghanistan, told U.S. troops stationed at the Marine Corps Base in Kaneohe Bay, Hawaii, over the weekend that their service had given Afghanistan a chance “to rebuild its own country.

“We are safer,” Obama said. “It’s not going to be a source of terrorist attacks again.”

Really? That’s a lofty promise, and one that’s profoundly difficult to fulfill.

If America truly is going to finish the job in Afghanistan, it will involve helping Afghanistan undertake the herculean task of healing its many, many wounds.



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