Posted by
Playful Walrus on Thursday, August 27, 2009 4:33:18 PM
Three pieces in the Los Angeles Times show why California is in trouble. Shane Goldmacher has an article on the latest tax increases.
While Californians are still feeling the sting of income and sales tax hikes signed into law earlier this year, now comes news that state tax authorities plan to take a little more from their pockets.
For only the second time in 30 years, the tax board is lowering the point where each tax bracket begins, bumping many people into a higher category. At the same time, officials are cutting back some deductions. Everyone will pay more, even people whose bracket or income doesn't change.
Great.
Meanwhile, columnist George Skelton enthuses about yet another group that claims to have the answers.
The bipartisan reform group California Forward has proposed a modest, reasonable and doable set of significant changes in how state and local governments operate.
We'll see.
There's no denying the problems: gridlock, perpetually late budgets, chronic deficits, IOUs, Sacramento raids on local coffers...
Don't forget high taxes and an environment hostile to business.
But these are some steps recommended unanimously by the California Forward's Leadership Council after 18 months of mulling:
Lower the Herculean hurdle for legislative passage of a state budget from a two-thirds majority to a simple majority. But retain the two-thirds requirement for tax increases.
Not sure how that would work. Sound like it would mean more borrowing, which necessitates more taxes.
For fiscal conservatives and anyone with common sense, require that unexpected spikes in tax revenue be spent only for one-time purposes, not to enhance programs in perpetuity.
This is toothless. The "one time" purpose every year could be "budget deficit", right?
Require the sponsor of any new spending proposal, whether in the Legislature or at the ballot box, to identify the funding source.
Good.
Budget for two years, rather than one, and regularly monitor the spending plan to watch for red ink.
Good.
Set clear goals for each program. If they're not met, change or chuck the program.
Good.
Prohibit the Legislature from raising taxes on a majority vote and calling them "fees."
Good.
Provide local governments with more control over their own fates by barring the state from raiding property taxes and other revenue.
Good.
Permit cities, counties and school districts to unite in some common endeavor, such as gang suppression, and pay for it with a tax increase passed by a simple majority of voters. Now it would require a two-thirds vote.
Keep the two-thirds requirement. Otherwise, we're screwed.
Relax term limits while reducing the overall time a person could spend in the Legislature.
Get rid of term limits.
Well, I’m not too impressed. I’ll say it again: 1) Split the state. 2) Make the legislature unicameral; reduce the number of legislators if possible. 3) Make the legislature a part-time "citizen" legislature.
Finally, there's this commentary from Ethan Rarick, director of the Robert T. Matsui Center for Politics and Public Service at UC Berkeley. He knocks Nevada's ads calling on California businesses to come to Nevada to escape taxation and regulations.
Relatively few businesses, once they're formed, pick up and move across state lines. Over the last several years, the nonpartisan Public Policy Institute of California has done exhaustive research trying to measure precisely how many jobs California has lost because of such moves, while also measuring the offsetting number we have gained from businesses moving into the state. The conclusion? The impact is tiny. The researchers found that the average annual job loss was only .06% of California's total employment. Just to be clear, that's not 6%; it's six one-hundredths of 1%.
The fact is, businesses are moving out, and how many are moving here from other states?. Others are choosing to expand or start up elsewhere instead of California. That study doesn't deal with business that would have added jobs in California, but didn't because of the business climate in California. Also, individuals who are good workers and citizens and entrepreneurs - people who produce more revenue for the system than they take - are leaving and being replaced by welfare/subsidy-dependent people.