I’ve received a number of calls from reporters over the last few
weeks seeking my reaction to the fact that many tax hike bills have
stalled in the Legislature. Despite the passage of Prop 30 giving
California both the highest marginal income tax rate and the
highest state sales tax rate in America, the sheer number of
legislative proposals seeking even more revenue is staggering.
Especially common are proposals to hit unpopular products or
industries like cigarettes, soda, and oil extraction. But, for now,
it appears that most of these tax hikes have lost traction.
When I was younger and more naïve, I would have shared the
reporters’ assumption that the Legislature isn’t as enthusiastic to
raise taxes as we originally feared once the Democrats achieved
their super-majority status. But I’m older, wiser and far more
cynical than I used to be and, more importantly, I’ve worked within
two blocks of the Capitol and have observed what really motivates
its inhabitants. In a word, it’s money. And the interests targeted
by these bills have lots of it.
For example, not long ago soft drink manufacturers rushed to
contribute millions to Jerry Brown’s… Read More