Reason Foundation Gives More Evidence That Initiatives NOT to Blame for California Budget Woes
As the attacks continue against California’s ballot initiative process, three scholars at the Reason Foundation are injecting some, well, reason into the debate. In a column written by Shikha Dalmia, Adrian Moore an Adam B. Summers that ran in the Wall Street Journal, they point out that “[California] voters aren’t tying lawmakers’ hands too much, but too little.”
Pundits and politicians alike love to blame voters for California’s current budget crisis, claiming that various initiatives over the years have locked up too much of the budget and prevented what they claim are necessary tax hikes. Along with that blame come calls to further restrict or scrap the initiative process. One candidate for governor has even gone so far as to make the ridiculous assertion that the initiative process has “outlived its usefulness”.
The Reason team cites a study done in 2003 by Initiative and Referendum Institute President Dr. John Matsusaka in which he found that “the initiative seems to be a scapegoat for the inability of California’s elected officials to manage the competing demands for public funds in a period of declining revenue.” In case you think those 2003 numbers are out of date, the Reason folks tell us that the non partisan Legislative Analyst’s Office looked at all the restrictions on the state’s budget from initiatives and other sources and found that:
“Despite these restrictions, the legislature maintains considerable control over the state budget—particularly over the longer term.”
If not the voters and their initiatives, what could have possibly caused the state’s problems? As the Reason team found:
[Ballot initiatives] are not the root cause of California’s fiscal disaster. That cause is the government’s spending addiction. From 1990 to 2008, California’s revenues increased 167%, but total spending soared 181%.
The Golden State’s problem is not overly controlling voters—but out-of-control politicians.
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Mr. Rider…. I wish someone did a similar report for Pennsylvania, where I live. While many from New York & New Jersey escape here for lower taxes, they also bring demands for more taxpayer services, so we will eventually be as miserable as NY & NJ. Add to this a state House that thinks the only way to deal w/ declining revenues is to increase taxes rather than decreasing spending, plus a host of other idiotic things not peculiar to us alone, and leaving my home state has begun to look better all the time.
Your report would be terrific for the nation as well. Our politicians believe ‘we the people’ are far to stupid to understand all of this. Yet it is ‘we the people’ who keep paying the bills. The notion we must increase taxes to pay for what our politicians & suspiciously influential special interest groups say are needed services, rather than decreasing services, is why we all are in an individual state & a national downward spiral, & are miserable. Our politicians need to stop spending. But the leftists in America want all to think we can spend taxpayers money to get out of this hole. The irony is, our leftists & political class are spending money we do NOT have. It almost looks like they want to force us into a situation where they can establish their concepts of a recreated society, all marching lockstep to the mantra of those the elite want us to believe are best to decide everything for us. Leftists around the world want us all to become a one world order, so some non-de-script group of social engineers can regulate us & create a world
‘they & they alone’ think is better for us all. It’ll never happen & in fact, we will be in a deeper hole. Its funny. Before the left had such control over America’s congress & White House, all they spoke about were individual rights. Now, all they talk about is a world where we all sacrifice our individuality for the ‘common good.’ Yet that common good always benefits that political & elite class much more than the rest of us.
Worse is that few wish to acknowledge our current set of crisis came from easy credit that bubbled into every other area of our financial sector. The ‘Community Re-Investment Act’ was used to create this financial crisis. Barney Frank knew in the 1990’s that if Fannie & Freddie failed, its costs would be dumped on taxpayers. “He” thought this was a good idea, rather than showing some restraint & not lending to people who knew going in they probably would not be able to repay the debts they were incurring. Add regulations corrupted by suspiciously influential special interest groups, like ACORN, & is it any wonder greed & theft led us to this downfall?
We need politicians who recognize that the only special interest group they should be pandering to, is the American public. And we need to tell those who cannot afford the good things in life they want, that they must work harder to get those things rather than expect everyone else to absorb the costs for them.
Its amazing when politicians try to lay blame for their actions at the feet of the very people who told them to stop what they are doing. Washington is doing the same thing. Now, we have an administration that cruises around the world telling any who will listen, mostly enemies of ours, why “WE” are the problem & not the despicable thuggish actions of tyrants, dictators, criminals, & power mad socialist thugs. Its sickening to listen to our own president tell people “we” created the problems of the world, while he ignores the problems the world created that we ended up having to fix for them as those same world leaders begged us to step in & save them from their own despicable actions.
The idea Americans should join in some lockstep one world order concept, is an anathema to the very founding principles of this nation, where getting others out of our personal business was the reason many came here to establish this nation.
In the end, we the people must step up & force all politicians to accept term limits and to accept limitations on their ability to increase taxes, load us down with arcane legalize regulations, & limit our abilities to live as free human beings. Those who think redistribution will solve our problems fail to realize everywhere such an idea has been tried over many decades, it has failed & has brought on massive misery to those who tried it!
Breaking Bad: California vs. the Other States
by Richard Rider, Chairman, San Diego Tax Fighters
Version 1.492 Revised 19 September, 2009
Phone: 858-530-3027 RRider@san.rr.com
Here’s a depressing comparison of California taxes and economic climate with the rest of the states. The news is breaking bad, and getting worse (I keep updating this article):
California has the 4th highest state income tax in the nation. 9.55% at $47,055. 10.55% at $1,000,000
By far the highest state sales tax in the nation. 8.25% (not counting local sales taxes)
Corporate income tax rate is the highest in the West (our economic competitors). 8.84%
2009 Business Tax Climate ranks 48th in the nation.
www.taxfoundation.org/research/topic/15.html
Fourth highest capital gains tax 9.55%
www.thereibrain.com/realestate-blog/capital-gains-tax-rates-state-by-sta…
Highest gasoline tax (averaging 64.5 cents/gallon) in the nation (July, 2009). When gas hits $3.00/gallon, we are numero uno – because unlike many states, we charge sales tax on gasoline purchases (built into the price).
www.api.org/statistics/fueltaxes/
Fourth highest unemployment rate in the nation. (August, 2009) 12.2%. National rate 9.7%.
www.bls.gov/news.release/laus.nr0.htm
One of the highest state vehicle license car taxes. 1.15% per year on value of vehicle, up from 0.65% in 2008.
http://tinyurl.com/lrvmtd
California’s 2009 “Tax Freedom Day” (the day the average taxpayer stops working for government and start working for oneself) is again the 4th worst date in the nation – up from 28th worst in 1994.
www.taxfoundation.org/research/show/387.html
To offset lower state revenues, 29 states are proposing 2009 state tax and fee increases totaling $24 billion. California, with 12% of the nation’s population, is proposing 47% of that increase (6/5/09).
http://money.cnn.com/2009/06/04/news/economy/states_budget_crises/index….
1 in 5 in LA County receiving public aid.
www.latimes.com/news/local/la-me-welfare22-2009feb22,0,4377048.story
California has 12% of the nation’s population, but 36% of the country’s TANF (“Temporary” Assistance for Needy Families) welfare recipients – more than the next 7 states combined. Unlike other states, this “temporary” assistance becomes much more permanent in CA.
http://weblog.signonsandiego.com/weblogs/afb/archives/034662.html
California prison guards highest paid in the nation.
www.caltax.org/caltaxletter/2008/101708_fraud1.htm
California teachers easily the highest paid in the nation.
www.nea.org/home/29402.htm (CA has the second lowest student test scores)
California now has the lowest bond ratings of any state, edging out Louisiana.
www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/03/19/BA7F16JLKH.DTL
California ranks 44th worst in “2008 lawsuit climate.”
www.instituteforlegalreform.com/component/ilr_featured_tools/29/item/LAI…
In 2005 (latest figures), for every dollar Californians sent to D.C. in taxes, we got back 78 cents – 43rd worst.
www.taxfoundation.org/taxdata/show/22685.html
America’s top CEO’s rank California “the worst place in which to do business” for the fourth straight year (3/2009). But here’s the interesting part – they think California is a great state to live (primarily for the great climate) – they just won’t bring their businesses here because of the oppressive tax and regulatory climate.
Consider this quote from the survey (a conclusion reflected in the rankings of the characteristics of the state): “California has huge advantages with its size, quality of work force, particularly in high tech, as well as the quality of life and climate advantages of the state. However, it is an absolute regulatory and tax disaster.”
http://tinyurl.com/cyvufy
California, a destitute state, still gives away college education at fire sale prices. Our community college tuition is by far the lowest in the nation. How low? Nationwide, the average community college tuition is 4.5 times higher than California CC’s. This ridiculously low tuition devalues education to students – resulting in a 30+% drop rate for class completion. In addition, 2/3 of California CC students pay no tuition at all – filling out a simple unverified “hardship” form that exempts them from any tuition payment, or receiving grants and tax credits for their full tuition.
www.sacbee.com/static/weblogs/capitolalertlatest/020722.html
http://tinyurl.com/ybrc2kn
On top of that, California offers thousands of absolutely free adult continuing education classes – a sop to the upper middle class. In San Diego, over 1,400 classes for everything from baking pastries to ballroom dancing are offered totally at taxpayer expense.
www.sdce.edu
California residential electricity costs an average of 35.4% more than the national average. For industrial use, CA electricity is 56.2% higher than the national average (2007).
www.eia.doe.gov/cneaf/electricity/epa/fig7p5.html
www.eia.doe.gov/cneaf/electricity/epm/table5_6_a.html
It costs 38% more to build solar panels in California than in Tennessee – which is why European corporations have invested $2.3 billion in two Tennessee manufacturing plants to build solar panels for our state.
http://tinyurl.com/llussb
Consider California’s net domestic migration (migration between states). From April, 2000 through June, 2008 (8 years, 2 months) California has lost a NET 1.4 million people. The departures slowed in 2008 only because people couldn’t sell their homes.
www.mdp.state.md.us/msdc/Pop_estimate/Estimate_08/table5.pdf
These are not welfare kings and queens departing. They are the young, the educated, the productive, the ambitious, the wealthy (such as Tiger Woods), and retirees seeking to make their pensions provide more bang for the buck. The irony is that a disproportionate number of these seniors are retired state and local government employees fleeing the state that provides them with their opulent pensions – in order to avoid the high taxes that these same employees pushed so hard through their unions.
As taxes rise and jobs disappear, we lose our tax base, continuing California’s state and local fiscal death spiral. This spiral must stop NOW.
NOTE: If you would like to receive my free periodic “Richard Rider Rant” e-newsletter with more of this type of information and analysis, just drop me an email at RRider@san.rr.com. To see the latest version of this “Breaking Bad” column, plus samples of my free “Richard Rider Rant” e-newsletter, go to my blog at www.open.salon.com/blog/Richard_Rider. This report also is available as a 2 page Word file for formatted printing.
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