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This is the first part of a series of posts analyzing California’s propositions.
California’s Budget Problems
Proposition 30 is the most important proposition on the ballot this year.
California, as is well known, has a big budget problem. This problem started with the onset of the economic recession and was worsened by a number of factors, ranging from extreme constraints on the legislature’s power to Arnold Schwarzenegger’s incompetence.
Things have gotten better lately. Schwarzenegger has been replaced with a governor who knows what he’s doing. The two-thirds supermajority requirement to pass a budget, which was responsible for much of the deadlock, no longer exists.
There are still big problems, however. California has implemented massive spending cuts to balance the budget. Program after program has been cut to the bone. Worse still, the state seems poised to cut far more if this proposition fails to pass.
Take the University of California system:
Since 2008, budget cuts have forced these universities to raise fees by more than 40%, compared with a national average of 15%. If Proposition 30 fails to pass, fees will be raised by 20% more still.
Why is this happening? It’s because the legislature has its hands tied. There are two ways to balance the budget: increase revenue and cut spending. California requires a two-thirds supermajority to do the former, and Republicans have consistently blocked revenue increases. So California has been left to cut, and cut, and cut.
Now, in general you should focus on cutting spending rather than increasing revenue to balance the budget. But California has taken it way too far. We have basically done nothing but cut and cut for nearly half a decade, without any revenue increases. There’s basically nothing left to cut at this point. But if Proposition 30 doesn’t pass the state will be looking once again for billions more to cut ($5.951 billion more, to be exact).
What Proposition 30 Does
Proposition 30 comes four years too late, but it’s still very necessary today.
Yes, Proposition 30 is a temporary tax increase. It falls mainly on families making over $500,000 – but the sales tax will increase as well. The sales tax increase lasts for four years; the income tax increase for seven.
But the truth is that in a budget crisis, eventually somebody will get hurt. If it’s not families making over $500,000 – it’ll be students and teachers and policemen and firefighters. For almost half a decade, budget cuts have again and again shafted these people. If Proposition 30 fails, they’ll be hit once again. If Proposition 30 passes, the pain will shift to families making over $500,000.
I endorse this proposition knowing that I will sacrifice a bit. Many Californians (perhaps the majority) will vote against this proposition because of this fact. But it’s not as if they’re dodging the pain by voting against Proposition 30. They’re just shifting it to their children.
4 Comments
If I were in California, I would vote for it. The constant economic crisis in California shows how foolish a “Balanced-Budget Amendment” to the Constitution would be to the US economy.
I was once a big fan of Jerry Brown. In 1992, the last time he ran for President, I opened for Jerry Brown in Florida (leading up to one of the early Primaries), then I moved to Ohio (location of one of the last Primaries) to work for his campaign.
Then when he was Oakland Mayor and on a book tour, I shook his hand while wearing my “Jerry Brown 1992 We The People 1-800-etc.” tee shirt. He told me that the number wass still working.
Then came the Occupy movement. Among many other incidents, a policeman sprayed a chemical weapon/Weapon of Mass Destruction, he sprayed a weapon that is banned in war into the eyes of students who were peacefully demonstrating.
Jerry Brown’s responsibility in that case was to ensure that the Torturer was prosecuted. Instead, the Spraying Torturer wasn’t even arrested. I hope that someday he and his co-conspirator Jerry Brown will be internationally prosecuted for Crimes Against Humanity and imprisoned for a long, long time.
I am very, very ashamed of having worked for Jerry Brown.
People in San Diego and Santa Rosa started to make progress on this problem when they passed measures that could change retirement plans of municipal workers there. Of course, the unions have promised to sue, and they probably have already. If left up to them, they will hobble the state forever. Right now as I understand it the top tax rate in California is 10 percent: isn’t that enough? The state sales tax is 7.25 percent: isn’t that enough? Not for Jerry Brown. Yet he admitted in an ad promoting his tax increase that passage of the measure wouldn’t really solve California’s money woes, but that it would help at least.
I’m sorry, Inolijt, but I doubt your claim that California has “cut and cut and cut.” Most likely, almost certainly, what they’ve done is cut everything except what should be cut, which is the bloated pay and benefits of state and municipal employees. What’s left is vital services, such as numbers of cops, firefighters, secretary of state services and the like, things that people feel everyday, but their lavish pay and benefits packages are most likely untouched.
Problem is that too much money is really going for the benefits of these employees, probably even more than the pay, but there are examples of egregious pay packages, too. Democrats are utterly beholden to these interests, and that’s the problem. But there’s a ray of hope in developments in San Diego and Santa Rosa.
You know, I actually wasn’t a fan of Jerry Brown. But I think that he’s been a good governor of California.
You’re right; union pensions are indeed too bloated. They should be cut.
But that won’t solve the problem. Revenues also need to be raised as well.