News
By Jon Coupal
Week of February 23, 2009
The pictures told the story. They were laughing, back-slapping and
sharing high fives all around. It could have been Butch Cassidy and
the Hole-in-the-Wall Gang celebrating a successful train robbery.
Only these were malefactors of another sort. They were members of
the Legislature expressing their joy immediately after agreeing to
make California taxpayers the most overburdened in the nation for at
least the next two years.
Lawmakers and the governor, who was equally eager to get his hands
on the new tax revenue, sought to make the bitter medicine taste
better by promising the new taxes were temporary -- only two years,
they say -- and by making a peace offering of a spending cap that
would force state government to be on its best behavior. If
taxpayers are wary of California lawmakers bearing gifts, they have
every reason to be. This spending limit is a limit in name only
because it will automatically go up as taxes are increased by the
Legislature.
At one time, California had a strong spending limit. In 1979, the
late Paul Gann, co-sponsor of Proposition 13, put a meaningful
spending limit on the ballot, which was approved by 75 percent of
voters. The Gann formula annually adjusted upward the state's
ability to spend based on the growth in population and inflation. If
revenues exceeded the spending cap, the law required that they be
refunded to taxpayers, and in 1987, tax rebate checks were actually
sent out.
However, most members of the Legislature and their special interest
allies chafed under the spending restrictions and, in 1990, language
that knocked out the cap was placed in Proposition 111, a gas tax
increase for transportation. When voters approved the tax with the
expectation that it would eliminate freeway congestion, unknown to
many, the Gann Limit was destroyed.
Since 1990, Sacramento has spent freely and without conscience. If
this so-called budget reform measure is approved by voters at the
May 19th special election, spending by state government will
continue virtually unabated. But it gets worse. If Proposition 1A
passes, it will do additional damage to taxpayers by extending the
new higher taxes for an additional two years.
The situation is reminiscent of the movie "Ruthless People" in
which, seeking to get even with a ruthless businessman played by
Danny DeVito, kidnappers hold his wife for ransom. Turns out he
doesn't care. He's been trying to get rid of his wife anyway.
In this case, lawmakers are holding the fake budget reform for a
$20 billion ransom. But like DeVito, taxpayers should be delighted
to let them keep it.
There is something worse than no budget reform. It is a phony budget
reform that must be purchased at an astronomical price. This deal is
so bad, they should be paying us to take it.
Jon Coupal is President of the Howard Jarvis Taxpayers Association
-- California's largest taxpayer organization -- which is dedicated
to the protection of Proposition 13 and promoting taxpayers' rights.
