GOP rebuts Dems' tax roadshow

MAY 12, 2010

By STEVEN GREENHUT

At a press conference at the Capitol this morning marking a 50-day countdown until the end of the state’s fiscal year, Assembly Republicans made it clear that they will not accept any new taxes in order to close the state’s nearly $20 billion budget gap. Assembly Republican Leader Martin Garrick of Carlsbad noted that Assembly Democrats “have orchestrated a roadshow calling  for higher taxes and for doing away with the two-thirds vote requirement.”

The Republicans pointed to the more than dozen tax-raising measures Democrats have introduced this year and noted that California has the highest sales tax rate in the United States, the highest gas taxes in the country and the second highest income tax rate. Furthermore, Garrick said, the state has a 12.6 percent unemployment rate and passed $12.5 billion in tax increases last year. He called for more business friendly approaches.

“The only limitation for Democrats on taxes they want to raise seems to be their imagination,” said Assemblyman Jim Nielson of Gerber. Nielson said Republicans want new tax revenue — but from the creation of good-paying jobs, not through job-stifling tax hikes. Assemblyman Dan Logue of Linda explained that Democrats have killed in committee every one of the Republicans’ job package — including bills that would provide manufacturing tax exemptions, education tax credits, research and development tax credits and that require an economic impact analysis of every new proposed regulation.

Nielson called not only for cut backs in the size of government but in the amount of government authority. He pointed to the California Air Resources Board as an agency that is out of control and “regulates by fiat, by memo.” Logue said that Democratic job-growth proposals were the equivalent of breaking every window in Sacramento and then paying people to fix them — a reference to economist Frederic Bastiat’s parable of the broken window. He accused Democrats of fighting over the shrinking piece of pie rather than attempting to expand the pie. Republicans focused on state job losses and on the state’s ranking by CEOs as the worst place in the country to do business — it ranked even lower than in a recent study than the District of Columbia and Puerto Rico, they said.

Assembly members referred to the new business mantra: ABC (Anywhere But California) and focused on the need to create a better business climate in order to jump-start the economy.

Nielson complained about Democratic bias in their hearings — those testifying are usually biased toward the idea that government ought to spend more.

Garrick deflected questions about specific cuts and said that Republicans will be more specific after the May budget revise is released later this week. He agreed that the state is going to face a “challenging budget battle.”

The Democrats clearly are pushing for new taxes as the solution to the state’s budget problem and Republicans have put those off the table.

No doubt, the two sides have staked out their positions and the coming budget battles should be contentious.

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  1. StevefromSacto
    StevefromSacto 12 May, 2010, 10:25

    Cuts alone will not work. Trying to solve our problem this way is like trying to fight with one hand tied behind your back.

    Why can’t we tax oil production, like every other oil producing state does?

    Why can’t we temporarily close tax loopholes? In this time of crisis, EVERYONE should be asked to sacrifice.

    Reply this comment
  2. StevefromSacto
    StevefromSacto 12 May, 2010, 12:51

    Also didn’t see any mention of the fact that the huge tax breaks in the Republicans’ so-called “jobs package” would increase the budget deficit from the current $20 billion to over $36 billion.

    Reply this comment
  3. EastBayLarry
    EastBayLarry 12 May, 2010, 19:47

    “Cuts alone will not work.” – Of course not Steve and the republicans are not asking for this. What they are looking for is a turnaround for the economy, allowing businesses to survive and even grow in California. THA leads to increased tax REVENUE, even with lower taxes rates.
    “…huge tax breaks in the Republicans’ so-called “jobs package”…” That’s right Steve, the ‘tax breaks’, especially for businesses, will create jobs, the income from which provides additional tax REVENUE.

    Try to grasp the difference between tax RATES and tax REVENUES.

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