Is the tax revolt over?

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The most optimistic piece I've read on the results of the November election is on Calitics, where Robert Cruikshank argues that the tax revolt that started with Prop. 13 in 1978 is finally over.

And while there is still a lot of work ahead to overturn the legal and constitutional legacies of the tax revolt, it no longer has political power. That in turn means the California Republican Party, and the California conservative movement, are as dead as Monty Python's parrot.

That's a pretty sweeping statement for a fairly modest tax package supported by the same governor who called himself a born-again tax-cutter in the wake of Prop. 13. But Cruikshank makes a good point:

This victory over the tax revolt happened because of years of progressive organizing against further tax cuts and for tax increases. Progressive voices and organizations completely rejected the post-1978 Democratic logic that the tax revolt had to be appeased. Instead, we insisted that the tax revolt had to be confronted and defeated. With Prop 30 that's exactly what happened.

I know the Democrats in the Legislature are going to be nervous about more tax hikes, particularly since the two-thirds majority includes some folks from pretty conservative districts who are going to be scared of "overreaching." But it's not just about general tax hikes; we got one this year, and we may not get another. It's about all of the long list of tax loopholes that art on the books that take a two-thirds majority to undo. It's about a budget that includes addition as well as subtraction. And it's about not being afraid to say that investment in the state has economic value.

Maybe the Dems don't have to be afraid; maybe this two-thirds majority isn't an anomaly and isn't going to change. Maybe the state is getting so much more Democratic that supermajorities are the way of the future and people are sick of the GOP no-new-taxes nonsense. Maybe (as I've long said with same-sex marriage) it's part of an inevitable demographic change:

Many of those angry white suburbanites convinced that people of color and their liberal allies were going to destroy their suburban paradise have left California, either by relocation or by the intervention of the Grim Reaper. In their place has grown up a native-born population that is diverse, that isn't ideologically wedded to car-centric postwar suburbs, and that rejected the "I've got mine, screw you" mentality of Howard Jarvis.

In which case we really can start turning this state around.

Comments

And bear in mind it is for a temporary tax hike that gets most of its revenues from a regressive sales tax.

Talk to me when there is a snowball's chance in hell of repealing Prop13.

Posted by Guest on Nov. 09, 2012 @ 12:47 pm

It's 8% on the Secretary of State's site. Also, a business tax measure passed by 20%.

That said, I agree the article is too optimistic. We're not at the point where California is ready for total repeal of Prop 13, but I think we'll get there eventually.

In the meantime, I think the legislature has a mandate to make small, sensible changes, like split roll.

Posted by Greg on Nov. 09, 2012 @ 6:33 pm

THAT I approve of.

Posted by Troll II on Nov. 09, 2012 @ 7:30 pm
Posted by Guest on Nov. 10, 2012 @ 1:26 pm

It's now 54.2% and growing. That means it's passing by 8.4%.

Incidentally, 52% isn't a 2% victory either. 52% would mean it's winning by 4%. As they say on Daily Kos... "You know, math."

Posted by Greg on Nov. 11, 2012 @ 11:31 pm

So if it got 52%, it passed by 2%.

If it got 54% as you claim, it won by 4%.

Most CA voters did not vote for 30.

Posted by Guest on Nov. 12, 2012 @ 7:02 am

When something/someone is winning by 54/46, people generally say it/they are winning by 8 points, or 8 percent.

Posted by Greg on Nov. 12, 2012 @ 9:11 am

Saying that 30 is passing by over 8 percent now (54%+), is not a "claim." That is a verifiable fact.

You sound like some of those folks on Redstate who live in a fact-free universe.

Posted by Greg on Nov. 12, 2012 @ 9:14 am

We need to raise taxes on the Federal level as well.

To start with, we should eliminate the mortgage interest deduction for any mortgage over $200,000.

We should stop letting state tax payments be deductible on Federal tax returns - why should the Feds get less tax revenue from California, simply because California decided to raise taxes?

We should also notice that one enjoys a substantial pecuniary benefit from living in a rent-controlled apartment - the difference between the market rental on a property and what you actually pay in rent should be reportable as income, and you should have to pay Federal income taxes on it.

Finally, we should eliminate the Bush tax cuts - not just for the rich, but for everyone. Millions of people stopped paying Federal income taxes thanks to the evil BushMcChimpyHalliburton tax cuts - it's high time we put all those people back on the Federal income tax rolls.

Posted by Demented, Yet Terribly, Terribly Persistent on Nov. 09, 2012 @ 1:20 pm

There's a great article on this in Cal's "Boom" magazine, hardly a bastion of right-wing thinking. Prop 13 didn't happen in a vacuum. Property taxes were increasing in the mid to late 70s by 40-50% a year in some cases - which is absolutely unsustainable. The property tax revolt occurred because property owners were being forced to swallow huge tax increases due to high property taxes combined with increasing property values.

Also - it'd surprise a lot of pro-Prop 30 voters, including myself, that we were voting to repeal Prop 13 through our votes. You're already overreaching here Tim. Remember Karl "Permanent Majority" Rove?

Eliminating the mortgage tax deduction for any mortgage over $200,000 eliminates that deduction for every blue state and ensures only red states will benefit. Do you know what property is worth in coastal California? Or for that matter Washington state or New Hampshire?

Posted by Troll II on Nov. 09, 2012 @ 3:35 pm

This was a wave election against the no new taxes or increases ever position of the ideologically libertarian Republicans, not a harbinger of a new era of tax happiness.

Posted by marcos on Nov. 09, 2012 @ 5:45 pm

rather than a shift in the wind. Californians are not willing to go back to a time when government could just increases taxes willy nilly. And any Democrat who thinks they have carte blanche to try and hike taxes will get a nasty surprise at the next election.

What the people really want is efficiency, prudence and restraint in government. Balance the books and resolve the deficit through strong fiscal management, not handing out a begging bowl.

Posted by Guest on Nov. 12, 2012 @ 7:05 am

Government needs to take back the begging bowl from corporate real property and establish a dual tax roll, one to keep people on their homes by freezing assessments and linking them to inflation, and another to have corporate owned properties pay their ongoing share of the cost of subsidizing their business through public infrastructure.

Posted by Guest on Nov. 12, 2012 @ 9:57 am

That's right, we all do, through higher prices for their goods and services.

Ultimtely only people can pay taxes, not entities.

Posted by Guest on Nov. 14, 2012 @ 7:01 am

I've heard ostensibly smart people say that. I was going to say it is a statement that seems true, but really isn't -- and I'm forgetting the word for that... a little help here? -- but now I wonder why anybody would even think it seems true.

No. The belief is based on another false belief that corporations set prices based on cost of sales. Corporations do not set prices based on cost of sales.

Cost of sales is useful as a guide, but prices are always set based on what the market will bear. We *can* tax corporations.

Posted by lillipublicans on Nov. 14, 2012 @ 7:18 am

if profits are down, then dividends and capital gains are down., costing those people money.

And before you say you don't care because only the "one percent" own shares, note that most shareholders are really institutions, and that is your IRA and 401K money, and or the investments of those who employ you, insure your life, provide services to you or otherwise benefit you.

Corporations are passthru vehicles. They don't have to exist, nor do they have to be in the business that you are seeking to tax, tax and tax again. Taxing business is not a free lunch; it trickles down to everybody.

Posted by Guest on Nov. 14, 2012 @ 8:25 am

"Most shareholders" is a meaningless bit of rhetoric. Of course the 1% own most of the stuff; that a small bit of the remainder might be widely distributed has no bearing on the subject.

As for the intellectually corrupt credo that investments create jobs -- i.e. "of those who employ you" -- I'm getting a bit tired of that rubbish, too. Investment does not create jobs. Investment follows opportunity. *Only*. Opportunity stems from demand. Only. (Okay, with one caveat: false demand is sometimes created through pernicious marketing techniques; investment in some phone bank to sell swampland lots creates jobs for the poor saps who get them, but provide no service of benefit to *anybody*.

No one has made the move to tax corporations out of existence yet, though your original premise seems to be arguing that they should not be taxed at all.

Bogus.

Posted by lillipublicans on Nov. 14, 2012 @ 8:48 am

"nothing" because there is no way that those costs trickle down to it's customers, employees and others who rely on their maintaining their ROI.

That's a "free lunch" position and cannot be justified. Taxes can be raised at any level you like but, in the end, it all percolates down to you and I. In recessions, it's the lowest rung of the ladder who suffer. Corporations retrench and, generally, survive.

Posted by Guest on Nov. 14, 2012 @ 10:35 am

And your entire argument which sits behind that silly paper-tiger silliness is incompetent because while ostensibly directed against corporate taxes, it is completely applicable to *all* taxes of any kind.

You are wallowing in pro-corporate propaganda if you believe half of what you write.

Posted by lillipublicans on Nov. 14, 2012 @ 10:56 am

directly or we tax businesses who then pass that tax on in one way or the other. So taxing companies is not "wrong". It's simply not "free".

Posted by Guest on Nov. 14, 2012 @ 1:39 pm

and yet you continue to repeat it here and elsewhere as if it had never been refuted. That's not ignorance in action; it's willful mendacity and trollery.

Once again, the false idea that corporations "cannot be taxed" is based on the false idea that corporations are altruistic and only charge for their goods and services based on their costs plus a reasonable profit; a ridiculous notion if it is in the least part examined.

No. Corporations charge whatever the market will bear to maximize the return on their investment. The corporations have a fiduciary duty to their stockholders to do so.

In fact, we as a society can, do, and will tax corporations. While some of those taxes may result in higher costs to consumers, the cost increases represent only a percentage of what costs would be represented by compensatory taxes levied directly on those individuals. Liar.

Posted by lillipublicans on Nov. 14, 2012 @ 1:57 pm

Corporations have to exist because people would otherwise not put up their capital unless they are insulated from the liability that said capital would incur when it is used improperly.

Posted by marcos on Nov. 14, 2012 @ 9:03 am

But I'm not sure what that ahs to do with your cited notion that if we tax corporations more, it somehow magically won't end up costing us more one way or the other.

Posted by Guest on Nov. 14, 2012 @ 1:40 pm

Corporations pass on as much of their expenses to their customers as the market will bear, after the market will bear no more, then the expenses come out of corporate profit, it is quite simple.

Posted by marcos on Nov. 14, 2012 @ 7:49 am

that it's shareholders and the market demands, then they switch to another business. That decreases supply and thereby raises the price of the commodity or service.

It's similar to the way that, faced with rent control in SF, landlords prefer to Ellis/TIC/Condo convert and/or otherwise go out of the rental business, causing further upward pressure on rents.

You can't squeeze ever more taxes out of comapnies without paying the price somewhere along the way.

Posted by Guest on Nov. 14, 2012 @ 8:20 am

So you want corporate welfare that coddles corporations that are on the brink such that incremental taxation makes their business model fail?

Posted by marcos on Nov. 14, 2012 @ 8:33 am

because it's taxes (or any other cost hike) cannot be recouped from their customers, then the slack has to be taken up somewhere else.

Maybe they pull out of that market, maybe they fire some employees, maybe they donate less to good causes but, one way or the others, they have to keep their shareholders (i.e. us) happy.

Posted by Guest on Nov. 14, 2012 @ 10:37 am

If individuals cannot afford to live in SF then it is hasta la vista, baby, but if a firm cannot afford to pay its taxes, then that is a pathetic sob story and the public has to cover the difference?

Posted by marcos on Nov. 14, 2012 @ 11:02 am

Somebody's been "drinkin' the Koolaid."

Posted by lillipublicans on Nov. 14, 2012 @ 11:12 am

business in Oakland. I can't afford Aruba or Aspen or Andorra either. Should their governments subsidize me so I can live there?

Posted by Guest on Nov. 14, 2012 @ 1:38 pm

First time I have agreed with anything you've posted ...

Posted by Guest on Nov. 13, 2012 @ 12:28 am

Redmond doesn't tell us the whole story about Robert Cruickshank, who writes a blog that supports high-speed rail. Cruickshank is jubiliant not so much about the passing of Prop. 30 but about the Democrats' two-thirds majority in the state legislature, which means they can now raise taxes to pay for the $100 billion high-speed rail boondoggle, since federal money will not be forthcoming.

Posted by Rob Anderson on Nov. 12, 2012 @ 10:06 am

What exactly do you have against HSR? If you want to go from SF to LA, the current alternatives are
A) 2 hours of humiliating and annoying security theater, followed by 1.5 hours sitting in a sardine can
B) 6 hours of cat and mouse games with the pigs on the freeway

There is a better way. Even China is getting with the 21st century.

Posted by Greg on Nov. 12, 2012 @ 10:29 am

6 Hours? I've been in the car with you, Greg. We drove down to LA last February and I made it in 5:30 flat, including a stop or two. Those Texas driving skills come in handy every so often.

Posted by Guest on Nov. 12, 2012 @ 10:41 am

"A) 2 hours of humiliating and annoying security theater"

TSA is going to extend the security theater to trains.

Read up on the VIPR program.

Posted by Demented, Yet Terribly, Terribly Persistent on Nov. 12, 2012 @ 2:45 pm

That makes perfect sense. Thus they maintain and expand their purview while also protecting the airlines from feeling any disadvantage.

Cui bono? The regressive interests of big petroleum.

Posted by lillipublicans on Nov. 12, 2012 @ 3:11 pm

LA Times, December 20, 2011:

"The Transportation Security Administration isn't just in airports anymore. TSA teams are increasingly conducting searches and screenings at train stations, subways, ferry terminals and other mass transit locations around the country.

"We are not the Airport Security Administration," said Ray Dineen, the air marshal in charge of the TSA office in Charlotte. "We take that transportation part seriously."
...

"U.S. officials note that digital files recovered from Osama bin Laden's compound in Pakistan after he was killed by U.S. Navy SEALs in May included evidence that the Al Qaeda leader had considered an attack on U.S. railways in February 2010. Over the last decade, deadly bombings have hit subways or trains in Moscow; Mumbai, India; Madrid; and London.""

You're dreaming if you think that TSA isn't going to have security checkpoints at HSR stations.

Posted by Demented, Yet Terribly, Terribly Persistent on Nov. 12, 2012 @ 4:00 pm

Used to be known as "Bombay" in print. And, by the way, I think bombings of trains may predate the CIA's fostering of Osama Bin Laden, even.

Posted by lillipublicans on Nov. 12, 2012 @ 4:49 pm

2 hours is pretty unusual to get through security at the airport. I am generally in line no more than 15 minutes. Small price to pay to fly a bit safer.

Posted by D. Native on Nov. 12, 2012 @ 6:35 pm

HSR won't help you get to LA faster, and it will be ruinously expensive for state taxpayers. And the current version of the project isn't what we voted for in 2008, not to mention the absurdity of plowing through some of the most productive farm land in the country. These issues will be hashed out in the courts, and the state is likely to lose that litigation. Many HSR supporters---mostly Democrats and progressives---have the same problem the Republicans had in the election: they live in a bubble that doesn't allow contrary information and views to penetrate.
The most thorough analysts of the shortcomings of the HSR project can be found on this website: http://www.cc-hsr.org/financialReports.html

Posted by Rob Anderson on Nov. 12, 2012 @ 10:51 am

which have now ended Republican veto power in the legislature. He said previously he thought the legislature should be in control of the legislature's districts and those of congress too. The last time that was allowed we got over a decade of gridlock as Dems and Reps in the legislature conspired to create boundaries to protect their incumbents. Never forgot that change was FORCED on the political parties in control of this state - if it weren't for non-partisan redistricting we'd be right back where we were in 2010 and before.

Moral of the story? Cruickshank is the biggest political whore in Sacramento. And with that bunch of whores that's really saying something.

Posted by Troll II on Nov. 12, 2012 @ 1:34 pm

As for redistricting, it is amusing -- is it not? -- that the plan to take it out of majoritarian hands came only because of the Democratic Party majority; no way in hell would any Republicans have signed on to sacrificing their own power in such a circumstance; and yet it worked out against them.

Funny how it seems sometimes all you have to do is give the repugs rope and they'll do the right thing with it.

Posted by lillipublicans on Nov. 12, 2012 @ 1:50 pm

It happened through the citizen initiative process and both the Republican and Democratic parties opposed it. Don't be giving hosannas to the Democratic party for redistricting - they opposed it off the bat and then supported efforts to repeal it once it was already underway. And Cruickshank was right there the whole time - backing the eternal wisdom of the legislature on these matters.

Posted by Troll II on Nov. 12, 2012 @ 2:20 pm

redistricting and top two.

Are you a right winger trying to make left wingers look stupid?

Posted by matlock on Nov. 12, 2012 @ 6:36 pm

Prop 13 has created an unfair situation that is bankrupting the state yet allowing many folks to pay less in taxes than others. Prop 13 was passed years ago to keep widows, orphans, and seniors from being tossed out of their houses due to rising home values and thus rising property taxes. However the reality of this legislation has allowed for a ridiculously unbalanced tax scheme.

I think we are going to have to dismantle this UNFAIR legislation one piece at a time.
1. Let's start with removing the allowance for businesses. A car dealer in Oakland pays less property tax than I do on my 2800 sq-ft home that I rent out. It makes new businesses less competitive than older ones. I can see where farmers may need to be exempt, but not most business. This element will likely be on the chopping block in the next few months anyway according to Jerry Brown.

2. Disallow the ability to pass down the current property tax assessment from one generation to another or to allow the homeowner to move and take their low assessment with them. I still scratch my head over this allowance and most people do not even know about it.

3. Put in a provision to recoup the tax differential (with a market-rate assessment) when the property is sold. My 90 year old neighbor was paying $800/year in property tax, I pay more than 10x that number on my smaller house. Like most of those enjoying the benefits of prop 13, he sold the house and received a huge gain on the appreciation. I propose that some of those gains should have been used to pay back the property tax differential that he enjoyed.

4. Start to ramp down the differential by raising the amount that property taxes can increase. It is currently limited to 2%.

I hope we can get back to a fair and balanced means to collect state taxes and return to the best schools, parks, and infrastructure in the country.

Posted by Guest on Nov. 15, 2012 @ 10:22 pm

your investments and life choices are fucked?

asshole.

Posted by matlock on Nov. 16, 2012 @ 12:50 am