FLASHREPORT

BUDGET IS UGLY, BUT HELD LINE ON TAXES

Jon Coupal, President of the Howard Jarvis Taxpayers Association

[Publisher's Note: As part of an ongoing effort to bring original, thoughtful commentary to you here at the FlashReport, I am pleased to present this column from Jon Coupal. Coupal is the President of the Howard Jarvis Taxpayers Association - Flash]

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Throughout this year’s budget debate, Republicans in the Legislature vowed to stand firm against any budget plan that raised taxes on Californians to pay for the spending choices of liberal politicians.

Despite facing enormous pressure from Democrats in the Legislature, Governor Schwarzenegger and liberal pundits in the news media, Republicans in the Legislature delivered on their promise yesterday by successfully negotiating a compromise budget with no new taxes.

Make no mistake, this indeed is an ugly budget.  The commentary from “policy experts” is unanimous:  This budget is abjectly irresponsible and merely delays the ultimate day of reckoning.  It is chock full of budgetary gimmicks and accounting shenanigans.  And yes, their complaints that it “borrows” from taxpayers are undeniably true.

So how can this be good for taxpayers?

Simple.  It is better that government is borrowing from you – even against your will – than it for government to take.  In the hierarchy of evil, tax increases are in a league of their own and anything – anything – is better than that.   

Moreover, by standing firm against tax increases, Republicans have set in motion a redefining of the battle lines in the Capitol.  Up to now, it has been the tax receivers (all the special interests dependant on tax dollars) lining up against the tax payers.  But if there is a broad understanding that tax increases are never going to happen, then all the tax receiver interests must compete against each other for the finite amount of public revenue.

Put crassly, it is time for the tax receivers to start eating each other and stop eating taxpayers.  If the Republicans had caved in on a general tax increase, either the Democrats desire to raise income taxes or the Governor’s desire to raise sales taxes, then that message would not have been sent.

And while there is much in this budget that simply delays resolution of important issues, it undeniably reflects a political victory for Republicans.  Even Senate President Pro Tem Don Perata had to admit to the San Francisco Chronicle, “bottom line – the Republicans won.”

Throughout the debate, Republicans showed over and over again the devastating impact raising taxes would have on families and businesses.  They were the only voice in Sacramento talking about how the push by Democrats to impose $6.8 billion in higher taxes on individuals and businesses would hurt California’s economy and make it much more expensive to do business here.  They pointed out that companies like AAA of Northern California were already leaving for other states because California has the highest business costs in the nation.  Raising taxes would have made it even costlier to own and operate a business here, and surely lead to more closures and more layoffs.

They showed that the costly one-cent sales tax increased pushed by Governor Schwarzenegger as a budget compromise was no compromise at all.  In fact, it would have imposed $15 billion in higher sales taxes over three years on those who can least afford higher taxes – working families already struggling to make ends meet.  They talked about how many were having a tough time affording record high prices for food and clothes, and how raising the sales tax would make these basic needs even more expensive.

So, if tax increases are off the table for the foreseeable future and we have merely delayed resolution of tough budget issues, what is going to happen?  It is our hope – although we are not very optimistic – that the Legislature will finally begin to do what it has not done in decades:  Prioritize spending, take its oversight responsibility more seriously and start addressing waste, fraud and abuse.  The difference is that now, they have a real motivation to do so.
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The mission statement of the Howard Jarvis Taxpayers Assocation reads:

The Howard Jarvis Taxpayers Association is dedicated to the protection of Proposition 13 and the advancement of taxpayers' rights including the right to limited taxation, the right to vote on tax increases and the right of economical, equitable and efficient use of taxpayer dollars.

Accomplished taxpayer advocate and prominent attorney Jon Coupal, as President of the HJTA, heads up an organization that plays a critical role here in the Golden State. Beginning with the passage of Proposition 13 in 1978, the HJTA has consistently been the lead organization looking out for the rights of California taxpayers. In literally EVERY major battle that occurs in Sacramento, where the forces of irresponsible government growth are trying to figure out another scheme to raise taxes or fees to redistribute taxpayer funds to the latest 'must fund' program, Jon and the HJTA are there to ask the tough questions, and to wave a big stick. You see, the HJTA doesn't just talk the talk. Whether leading efforts to get their many, many grassroots members to lobby their elected officials, going to court to fight illegal tax increases, or marshalling resources to take tax-protection measures to the electorate, HJTA has been there. But not just on a statewide level, but also at the local level -- fighting against local bond measures and fee-increase schemes that seek to unduly and unfairly burden taxpayers.

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You can write to Jon Coupal (via the FR) here.