Here we go again. As frenzied as the tax-hike obsessives have been in recent months and years, Jerry Brown’s weekend warning that the 2012-13 budget is $16 billion short is sure to ramp up their intensity. So get ready for the media/Dem onslaught, folks, and prepare to be reviled.
Will Jerry Brown get lots of blame for his $4-billion-in-extra-revenue fantasy that he concocted last June? It’s made a dire situation much worse.
Will anyone in the media point out that contracts with gov unions that Jerry approved this fiscal year not only continue providing “step” increases for time on the job — in other words, just for showing up — but overall pay hikes?
Will anyone in the media point out that the people with power in this state have blocked all fundamental reforms — except the one (prisoner “realignment”) that allowed them to shift costs to local governments?
No, no and no.
Instead, we’ll see the usual one-two punch to explain all that is wrong with California.
1. Those damn Republicans who oppose tax hikes are to blame.
No. They’re. Not. For all the alleged insurmountable obstacles to raising taxes in California, the state has among the nation’s highest income, sales and gasoline taxes; and the highest corporate taxes in the West. Property taxes are about average, thanks to Prop. 13. We should be able to live within our means. Most other states can pull this off. Which brings us to the next refrain in the Dem/media litany…
2. Prop. 13 is to blame. It ruined the state.
No. It. Didn’t. The limit on the annual increases has not prevented property tax revenue from going up by more than population growth and inflation for more than 30 years. Yes, the state may have a screwed-up tax structure. But that’s not Prop. 13′s fault. That’s the fault of the status quoists in Sacramento who like things as they are, no matter what, just with more money from taxpayers.
And the incredible thing about Prop. 13 is that it just showed its utility all over again during the housing bubble. Home prices in some markets nearly tripled from 1998 to 2006. Imagine the disruption in the lives of retirees and those living on fixed incomes if their property taxes had gone up that fast. Yet I think I’m the only guy in the California print media who has ever mentioned this. That’s incredible, when you think about what that says about media conformity — and stupidity. How is it not news that Prop. 13 saved millions of people from disaster?
Because it doesn’t fit the narrative.
A more honest narrative might occasionally, yunno, note that the revenue crisis could be alleviated with economic growth, but that the Legislature and the governor only care about the sliver of the private sector economy that includes “green” jobs.
A more honest narrative might also note that for the eighth year in a row, the nation’s CEOs have rated California as the most business-hostile state.
But those narratives will give way to the usual media-Dem juggernaut. Everything can be made right in California with higher taxes, and people who don’t support higher taxes are greedy “terrorists.”
This is one case where I’m rooting for the “terrorists” — my fellow “terrorists.”
Tom McClintock saw all this coming in September 2008 in his final major speech to the Legislature:
According to the State Controller’s reports, last year, our tax structure produced $96 billion in actual revenues – a record year. We budgeted $103 billion and spent $107 billion.
In short, our spending exceeded our revenue by $11 billion and exceeded our adopted budget by $4 billion. This year, if the economy gets no worse, we can expect to produce $97 billion in tax revenues. Claims that the revenues will be higher are based on accounting gimmicks that mask the numbers but do not change the underlying reality. ….
So I leave the Senate with this warning. I believe that last year’s budget pushed this state beyond a fiscal tipping point. The unsustainable growth of spending pushed us beyond a point where neither tax increases nor conventional line item reductions can bring us into balance. …
I believe we have now also passed the point where conventional budget reductions can restore our state’s finances. I believe we have now reached the terminal stage of a bureaucratic state where our bureaucracies have become so large and so tangled that they can no longer perform basic functions.
“The terminal stage” has been unfolding ever since. What happens to California? It changes in sweeping, fundamental, unprecedented ways.
Or it collapses.