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February 12, 2008

Political Suicide

-- by Dave Johnson

This post originally appeared at Speak Out California


Conventional wisdom considers it political suicide for a candidate to talk about the need to raise taxes so the state can pay its bills -- especially if it involves reforming Proposition 13.

Much of the public thinks that government "spends too much" and that much of the state's budget goes to "waste, fraud and abuse."

Much of the pubic also thinks that the primary beneficiaries of Prop. 13 were little old ladies who otherwise would lose their homes to increasing property taxes.

Reality, rarely consulted, understands things very differently.

California faces another budget crisis. The Governor proposes solving the problem with budget cuts.

California's budget pays teachers, fights crime, maintains roads and bridges and other necessary activities. There simply is no room for cuts to balance the budget. In fact, budget cuts just make following year shortfalls worse. If you lay off teachers they aren't paying taxes. If you don't fix roads the economy gets worse. In the long term, if you don't educate kids employers move jobs to states and countries that do. And, of course, it is always a really bad idea to cut back on police and courts -- especially after years and years of cuts in education.

Budget cuts don't work, so how about the modern solution to budget problems? I mean, of course, just borrowing the needed money. But Governor Schwarzenegger proved that the state can't borrow its way out of budget crunches: A major reason for this year's budget problems is the interest owed on Schwarzenegger's past easy fixes of issuing bonds.

The reality is that the budget cannot be fixed with budget cuts or more borrowing. We need to increase taxes. We need to start by reforming Proposition 13, raising corporate taxes, closing tax loopholes and taxing oil that is pumped from the ground. If we decide to do these things we might find that we not only fix California's budget problems for good, we might even be able to lower income taxes.

Reality also shows that the major beneficiaries of Proposition 13 were not little old ladies but large commercial real estate holders. It would be so easy to put a "little old lady" exception into property tax rules so they are not forced from their homes. But it would be political suicide to even discuss reforming Proposition 13 because of the power of the large commercial real estate owners. They want their tax break and don't care if the whole state goes broke and everyone else suffers. They are able to put a lot more money into the election process than regular people. That is why it is political suicide to talk about raising property taxes.

Why is it political suicide for a candidate to propose ways to fix problems, but not political suicide to cause them or make them worse?

Click to continue.

Posted by Dave Johnson at February 12, 2008 12:46 PM

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