Spending cap? "No way!" say Democrats, "That might cap spending!"
Posted by: Chuck DeVore | 08/17/2008 10:48 AM
A clearer illustration of the vast gulf separating Republicans from Democrats couldn't be found than Friday's Budget Committee hearing on Assembly Constitutional Amendment (ACA) 19, a bill to limit California state spending to inflation plus population growth.
The purpose of the Republican-drafted bill was to keep the annual rate of spending increases in Sacramento at a steady and predictable pace so that sudden large influxes of revenue would not be immediately spent, but rather saved for a "rainy day" - such as the $16 billion fiscal flood we are now facing.
Most other states do this which is why most other states have carried large cash reserves with them into this current economic slowdown.
California's unemployment rate is at 7.3 percent, the fourth highest in the nation, with 400,000 more Californians out of work than at this time last year. Now is not the time to be proposing to hammer the economy with an additional $9 billion in taxes, as the Democrats are proposing to do. Raising taxes at this time will only deepen our economic slowdown and ensure that California will be among the last of the states to recover.
Yet, in spite of the obviously negative effects of massive new taxes, the Democrats at Friday's hearing were unanimous in their scorn for a spending cap. Democrat after Democrat challenged the very concept that there should be any limits on government spending at all. Several Democrats attacked ACA 19's restrictive language dealing with emergencies, wherein the state spending cap could be lifted to deal with an enemy attack or "...fire, flood, drought, storm, civil disorder, earthquake, or volcanic eruption."
"Wouldn't you say that our educational system is in crisis... ...that it's an emergency?" one Democrat asserted. While another Democrat said the same of healthcare.
This line of reasoning starkly illuminated the Democrat's mindset: that every foreseeable "need" for larger government can be construed as an "emergency" requiring more spending, more taxes, and more borrowing.
It became quite clear that the 40 percent increase in overall state spending since 2003 was not enough to satisfy any of the Democrats on the budget committee.
So, while California has the highest income tax in the nation, the highest state sales tax rate, the highest gas tax, the highest corporate tax in the West, and with property taxes only at the national average, Democrats say it is not enough. Democrats want higher taxes so government may grow without restraint. Meanwhile, Forbes magazine recently listed California as having the highest business costs in the nation (a combination of tax, energy and labor costs) while the Tax Foundation says that California has the 47th worst business tax climate in America (just ahead of New York, New Jersey and Rhode Island).
Clearly, any additional state tax increases would only add to California's economic woes - especially income tax increases, since there is nothing more mobile in the 21st Century than the wealthy and their money. Superstar Golfer Tiger Woods used to live in my district. Now he lives in Florida because Florida has no income tax. Or take the case of former California inventor Gilbert Hyatt, the creator of the modern computer chip. Hyatt moved to Nevada in 1991 to escape California's high taxes (as with Florida, Nevada has no income tax). The state Franchise Tax Board unwisely pursued Hyatt, harassing him, going through his trash in Nevada, and generally making his life miserable. In defense of their fellow Nevadan, a Nevada jury just returned a $388.1 million verdict against California for "invasion of privacy" and "emotional distress."
Rather than drive the most successful Americans out of California, our tax policies should welcome them - and their job-creating capital.
One last example of what we are up against in Sacramento. At the conclusion of the very able testimony from Assemblyman Roger Niello, a co-author of the bill, the Budget Committee heard from members of the public. Only Jon Coupal of the Howard Jarvis Taxpayers Association spoke in favor of the proposed spending cap. In contrast, the spending lobby was out in force with 23 of the 25 people lined up to speak against the spending cap representing government union members.
25 to 1 vividly captures the challenge facing us in California.
Meanwhile, we go to Sacramento today for a rare Sunday vote on the budget -- a budget that would increase spending $2 billion over last year and increase taxes by about $9 billion (we'll see the exact details as the Democrats just gave the hundreds of pages of it to us yesterday).
All the best,
Chuck DeVore
California State Assemblyman, 70th District
The purpose of the Republican-drafted bill was to keep the annual rate of spending increases in Sacramento at a steady and predictable pace so that sudden large influxes of revenue would not be immediately spent, but rather saved for a "rainy day" - such as the $16 billion fiscal flood we are now facing.
Most other states do this which is why most other states have carried large cash reserves with them into this current economic slowdown.
California's unemployment rate is at 7.3 percent, the fourth highest in the nation, with 400,000 more Californians out of work than at this time last year. Now is not the time to be proposing to hammer the economy with an additional $9 billion in taxes, as the Democrats are proposing to do. Raising taxes at this time will only deepen our economic slowdown and ensure that California will be among the last of the states to recover.
Yet, in spite of the obviously negative effects of massive new taxes, the Democrats at Friday's hearing were unanimous in their scorn for a spending cap. Democrat after Democrat challenged the very concept that there should be any limits on government spending at all. Several Democrats attacked ACA 19's restrictive language dealing with emergencies, wherein the state spending cap could be lifted to deal with an enemy attack or "...fire, flood, drought, storm, civil disorder, earthquake, or volcanic eruption."
"Wouldn't you say that our educational system is in crisis... ...that it's an emergency?" one Democrat asserted. While another Democrat said the same of healthcare.
This line of reasoning starkly illuminated the Democrat's mindset: that every foreseeable "need" for larger government can be construed as an "emergency" requiring more spending, more taxes, and more borrowing.
It became quite clear that the 40 percent increase in overall state spending since 2003 was not enough to satisfy any of the Democrats on the budget committee.
So, while California has the highest income tax in the nation, the highest state sales tax rate, the highest gas tax, the highest corporate tax in the West, and with property taxes only at the national average, Democrats say it is not enough. Democrats want higher taxes so government may grow without restraint. Meanwhile, Forbes magazine recently listed California as having the highest business costs in the nation (a combination of tax, energy and labor costs) while the Tax Foundation says that California has the 47th worst business tax climate in America (just ahead of New York, New Jersey and Rhode Island).
Clearly, any additional state tax increases would only add to California's economic woes - especially income tax increases, since there is nothing more mobile in the 21st Century than the wealthy and their money. Superstar Golfer Tiger Woods used to live in my district. Now he lives in Florida because Florida has no income tax. Or take the case of former California inventor Gilbert Hyatt, the creator of the modern computer chip. Hyatt moved to Nevada in 1991 to escape California's high taxes (as with Florida, Nevada has no income tax). The state Franchise Tax Board unwisely pursued Hyatt, harassing him, going through his trash in Nevada, and generally making his life miserable. In defense of their fellow Nevadan, a Nevada jury just returned a $388.1 million verdict against California for "invasion of privacy" and "emotional distress."
Rather than drive the most successful Americans out of California, our tax policies should welcome them - and their job-creating capital.
One last example of what we are up against in Sacramento. At the conclusion of the very able testimony from Assemblyman Roger Niello, a co-author of the bill, the Budget Committee heard from members of the public. Only Jon Coupal of the Howard Jarvis Taxpayers Association spoke in favor of the proposed spending cap. In contrast, the spending lobby was out in force with 23 of the 25 people lined up to speak against the spending cap representing government union members.
25 to 1 vividly captures the challenge facing us in California.
Meanwhile, we go to Sacramento today for a rare Sunday vote on the budget -- a budget that would increase spending $2 billion over last year and increase taxes by about $9 billion (we'll see the exact details as the Democrats just gave the hundreds of pages of it to us yesterday).
All the best,
Chuck DeVore
California State Assemblyman, 70th District
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California Stuff
Mr. Ayer registered as a Republican to be electable in an interim election with no incumbents. He did...
The Sarbanes-Oxley Act of 2002 also known as SOX; is a United States federal law enacted in response to a number of major corporate and accounting scandals including those affecting Enron, Tyco International, and WorldCom.
The Act intends to close the loopholes associated with the old “I did not know …ask my aides” excuse and requires executives to
1. Certify the information is correct
2. Certify they know the contents
3. Certify there is a process to assure the information is correct.
Something similar is required in the California legislature to assure lawmakers only sign legislation they fully understand, rather than leave it up to special interest groups and or lobbyists.
Governor Arnold Schwarzenegger recent position saying No bills will get signed until there is a budget is a good step in the right direction. However, we have argued that such position is necessary, but not sufficient and point to a recent editorial by Donie Vanitzian, co-author of the Los Angeles Times Associations column, blasting Gary Quackenbush and the California Association of Realtors (CAR) for their support of Assembly Bill 2259, which she characterizes as "a farce, a contradiction in both terms and alliances", then goes on to describe how she put CAR, Los Angeles MayorVillaraigosa, and Congressman Rosendahl's on notice about the problems with A 2259. "Remarkably, Assembly Bill 2259 now contradicts provisions written into Assembly Bill 980 sponsored by none other than, the California Association of Realtors" Vanitizian writes.
Vanitzian then concludes that "CAR and the California legislature want it both ways", indicating that CAR and the legislature want to "decide whether or not a homeowners association can amend, rewrite, and restate covenants, conditions, and restrictions as it relates to renters and rental property." That the only reason this piece of legislation is now getting attention is "because of the housing crunch", and that "just as CAR appeared to have failed in performing the vital due diligence in pushing Assembly Bill 980, so too, they failed to perform the proper due diligence with Assembly Bill 2259.
Never mind that AB2259 is a classic example of the Bigger Government paradigm we are now all too familiar with:
Assembly Bill 2259 establishes a California Building Rehabilitation Code Advisory Council ("Council") to advise the advisory panels of the State Building Standard Commission on the possible adoption of state building rehabilitation guidelines.
Specifically, this bill: Establishes the Council with an UNSPECIFIED NUMBER of members, all appointed by the director of the Commission. Members shall include, but not be limited to
representatives from the following organizations:
* California Building Standards Commission;
* Department of Housing and Community Development;
* Division of the State Architect;
* Office of the State Fire Marshal;
* California Energy Commission;
* League of California Cities;
* California State Association of Counties;
* California Building Industry Association;
* Building Owners and Managers Association;
* County Building Officials Association of California;
* California Building Officials;
* American Institute of Architects California Council;
* California Apartment Association;
* Structural Engineers Association of California;
* Concrete Masonry Association of California and Nevada;
* California Hotel and Motel Association;
* Consulting Engineers and Land Surveyors of California;
* California Business Properties Association; and,
* California Association of Realtors.
And directs the Council to make recommendations and yada, yada,
yada....................
Would having in placea SOX-type of self-regulation in the California legislature have made a difference in this case? Do not know the answer...
The point is that California State Assemblyman Chuck DeVore and the rest of the California lawmakers should BBQ all the sacred cows, stand up against uncontrolled spending and against self-serving legislation.
Chuck-
Great post. I appreciate your consistent voice on tax issues in California. Tell me, what are the chances you take on Boxer in 2010 (2012 against whatever liberal makes it out of the primary) or perhaps Governor?
The chances are zero to none - none just left the building!
The point is that California State Assemblyman Chuck DeVore and the rest of the California lawmakers should BBQ all the sacred cows, stand up against uncontrolled spending and against self-serving legislation.
Cotoblogzz:
In case you haven't, that is precisely what Chuck has been doing since being sworn in too the legislature. If we had more legislators like Chuck DeVore, California wouldn't be in this mess.
Perhaps you should train your fire on those who are part of the problem.
Indeed I have noticed. The shoes were thrown out to see who yiells OUCH! first.
In other words, view this as a kudos to the Honorable DeVore.....as it turns out, the "probability" comments was aimed at a different target, and for tha I apologize.