July 09, 2008
Dems have fix for California woes: Bend over, grab your ankles
The Sacramento Bee reports that Democrats have come up with a novel way of solving the state's fiscal crisis: Tax the crap out of people who earn "too much" and those perverse entities that enslave workers and pay them a pittance, i.e., businesses.
Democrats on Tuesday proposed billions in tax increases on businesses and high earners to help bridge California's budget shortfall.
The proposed hikes include rolling back the dependent child income tax credit expanded in the 1990s, creating two higher income tax brackets for the state's biggest earners and increasing corporate taxes.
Ah, yes, screw the so-called rich, because they don't fork over enough of their hard-earned cash into the gaping, drooling maw of the spendthrift legislature, where their dollars can be converted into waste, fraud and abuse, the remaining bucks simply handed over to people who have done nothing to earn or deserve them -- other than voting for the redistributive socialist slimeball pols who will reward them for said votes.
Do I sound annoyed? Democrats used to understand that revenue shortfalls were eliminated by cutting taxes, not raising them. John F. Kennedy saw a massive increase in tax revenue when his proposed tax cuts went into effect.
Because Americans still have the freedom to vote with their feet and move to another state -- especially high earners and corporations -- the unintended consequence of such tax hikes is to create a voluntary exodus, leaving behind ... how shall I put this? ... those who add little to the state's coffers, but suckle mightily at the gummint teat.
In a rare example of intestinal fortitude, the nearly catatonic California branch of the Stupid Party (GOP) rouses itself from its ineffective torpor and does something.
The long-awaited list of revenue proposals faces near certain defeat, however, as Republican lawmakers have repeatedly said they are unified in their opposition to any tax increases. Approving a budget and increasing taxes requires a two-thirds vote, which means GOP support is mandatory.
Naturally, the Dems will not be deterred, desperately searching for a way to find enough votes to resume their taxpayer beat-down.
"I guarantee you it will be a troubled and very challenged proposal on the Assembly floor," said Assemblyman Roger Niello, a member of the two-house budget conference committee that finished its work over Republican opposition Tuesday. "After we're done (rejecting the tax increases), we can all go back to square one to figure out how we get a supermajority vote on this budget."
Super. Of course, it could be worse; earlier proposals from the Dems were even more confiscatory, pillaging more than $11 billion from taxpayers, as opposed to the paltry $8 billion they want now.
Hold on to your wallets -- here are the details.
Democrats have proposed before -- a 2005 move failed to receive a single GOP vote -- the creation of 10 percent and 11 percent tax brackets for high earners. The highest tax bracket now is 9.3 percent.
The plan unveiled Tuesday would impose a 10 percent rate on the portion of couples' incomes above $321,000 a year and an 11 percent rate on the portion of income above $642,000.
It would raise about $5.6 billion a year.
Big business would lose its net operating loss deduction for three years, bringing the state another $1.1 billion, according to the Senate plan. And the plan would restore the franchise tax rate for businesses from 8.4 percent to 9.3 percent, raising $470 million.
Reducing the dependent income tax exemption would bring the state about $215 million in the fiscal year that started July 1.
[...]
The Senate's proposal would apply only to households with adjusted gross income more than $150,000 a year. It would lower the current allowable exemption for each child from $294 to $94 - the same amount currently allowed for a personal exemption.
Democrats rejected a more ambitious plan advanced by Legislative Analyst Elizabeth Hill who called for the dependent credit to be rolled back for all families, regardless of annual income. It would have raised $1.3 billion for then state.
Did you get that last part?
Democrats rejected a more ambitious plan advanced by Legislative Analyst Elizabeth Hill who called for the dependent credit to be rolled back for all families, regardless of annual income. It would have raised $1.3 billion for then state.
Let me translate:
Democrats ran screaming from the floor in horror, shocked and appalled by a proposal to eliminate exemptions from the coming tax increases, spreading the burden broadly, forcing everyone -- even the so-called poor and middle class -- to feel the pinch.
Can't have that, can we? Tax hikes only make political sense if it's some other dude stuck with the tab. Across-the-board increases for everyone?
That might make the electorate reconsider Democratic dominance of California politics.
Would that it were so.
Posted by Mike Lief at July 9, 2008 07:18 AM
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Comments
"Feckless Crapweasels," every one.
Posted by: Steve at July 10, 2008 01:50 PM
What really irks me beyond belief is the revolting arrogance of government that no matter what the economy is doing, IT will not have to do without.
Posted by: BlogDog at July 10, 2008 06:16 PM