No ‘Giffen Good' deed will go unpunished

To the editor: There exists an economic concept known as a “Giffen Good.” Named for Sir Robert Giffen, a Giffen Good is a product for which consumers have greater demand as the price increases. To explain the idea, economists cite unique products like a Rolex watch or an historical artifact or even prime real estate. The more Giffen Good costs, the more people want to buy it. The main problem with the Giffen Good, however, is that a person would have as much chance of buying a one as he or she would have finding Sasquatch, Nessie, or a New Jersey devil . There has never been a Giffen Good. As often as cryptoeconomists have searched the bottom of Greenwood Lake, never once has a Giffen Good been captured or even photographed. It’s an urban legend. Back here on Earth we adhere to certain unalterable dogma, like “what goes up must come down,” “no good deed goes unpunished,” and the Laws of Supply and Demand: if the price of a product increases, then demand decreases. If my friends at Masker’s Orchard increase the cost of a bag of apples, Manhattanites driving up Route 17A are likely to continue down the road a little further and buy some of the equally delicious apples at Penning’s Orchard. If both Masker’s and Penning’s increase the cost of apples, those weekend visitors to Warwick may go elsewhere and buy pears or peaches or maybe even antiques. The belief that the creation of a Community Preservation Fund would not be the equivalent to the creation of an additional tax to Warwick homeowners is either blissful ignorance or malevolent disinformation. Just as the term “Intelligent Design” is a euphemism for Creationism and “Pro-Choice” is a public relations firms’ less offensive means to refer to killing unborn babies, “Community Preservation Fund” means TAX! Could we just call it what it is? Any additional cost to the buyer, like the Warwick Home Owner Tax (WHOT?), will result in one unpleasant reality. Because real estate in Warwick is not a Giffen Good, real estate demand in Warwick will decrease until the sale price decreases to match the off-setting WHOT? Assuming the WHOT? is 0.75 percent of the real estate price, the sale of a $300,000 home would mean about $2,250 fewer dollars in the pocket of the family who earned it. It’s not the buyer who pays it. Back here on Earth, it’s the seller. Warwick can have judiciously planned growth without raising the taxes on the hard-working people of Warwick. We can protect our farms, or water, and provide corridors for wildlife. We can accomplish our goals by electing officials who take responsibility for zoning our community to balance affordable housing, jobs, recreation and preservation rather than those who are simply willing to take our money and freedom to spend it as we decide. Friends, there is no Big Foot in Warwick and cryptoeconomists have not found a Giffen Good either. WHOT? will cost Warwick residents money. Vote to keep the money we earn. Vote to hold our elected officials responsible for the decisions they make. Vote “No” on Nov. 7 when asked to create a Community Preservation Fund. A father, a widower, a homeowner, a professional business manager, and an author, Tom Mattingly of Warwick has a B.A. in economics from the University of Missouri and an M.B.A. from Gannon University in Erie, Pa. He writes under the pseudonym, Matthew S. Field, and his next children’s book, ‘The Three Pigs, Business School, & Wolfe Hash Stew’ will be released in 2007.