[taxabletalk] Russ: California Democrats to Voters: We Don't Care What You Think

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Posted by Russ:
California Democrats to Voters: We Don't Care What You Think
http://www.taxabletalk.com/posts/1245252655.shtml


   The headline says it all. Democrats in the state legislature are
   telling California voters that it doesn't matter that you turned down
   the budget initiatives last May, we know better and the solution must
   include tax increases. That's the only possible meaning of the
   Democrats' proposal for eliminating the $24 billion deficit.
   While the full Democratic proposal hasn't been released, key elements
   have been. Here are some of the features:
   - A 9.9% oil extraction tax;
   - An increase in tobacco taxes. Cigarette taxes would increase from
   $0.87 to $2.37 a pack;
   - Reversal of two corporate tax relief measures passed last September
   to allow passage of the 2008-09 budget; and
   - A new $15 additional vehicle license fee tax to fund state parks.
   Additionally, Democrats rejected Governor Schwarzenegger's proposed 5%
   cut in the pay of state workers.
   [1]Two quotes from the story in the San Francisco Chronicle tell the
   full picture. First, Republican Assemblyman Jim Nielsen noted that the
   proposal was "...the most massive and quickest tax increase ever
   imposed in the history of California." Given that tax increases
   require a 2/3 vote for approval, this measure may be d.o.a. However, I
   suspect Democrats will call the tax increases "user fees" in order to
   sidestep the measure. No matter, Governor Schwarzenegger has said that
   he will veto any measure with tax increases.
   Meanwhile, Democratic State Senator Alan Lowenthal noted, "I'm really
   concerned when we put up any taxes as Californians are struggling to
   pay their mortgage, their rent and to put food on the table. The
   perception of the Legislature is we can't live within our means. We
   have to realize we will pay a price for doing this."
   Apparently, Democrats believe that the price they'll pay from the
   voters is less than the price they'll pay from the unions if they pass
   pay cuts.
     _________________________________________________________________

   Here's the reality: This proposal will not become law. Sooner or later
   California will have to learn to live within its means. I suspect we
   will see yet another budget stalemate, with California running out of
   money in July. Democrats in the legislature believe that they can
   print money. Only the federal government can do that. The day of
   reckoning for California has been postponed many, many times. It's
   here.
   The only solution is massive budget cuts. Governor Schwarzenegger's
   budget (in general) spends what California will bring in. I suspect it
   might be late August or September before we see a budget where
   spending matches revenues.

References

   1. http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/06/16/MN9O188GFU.DTL