"Tax haters"

John Seiler:

George Skelton’s tax obsession is in fine form in today’s column in the equally tax-obsessed L.A. Times. Skelton writes against “tax haters” who “acted out of knee-jerk ideology” in opposing the tax increase voters rejected in 2009.

The tax increase would have extended the tax increases previously passed by the Legislature and in February 2009 and signed into law by Gov. Taxenegger, but which are scheduled to expire next year.

Actually, despite the tax increases, the deficit grew, from $19 billion before the tax increases, to $28 billion next year, assuming the tax increases expire. Put another way, aside from the revenue of the 2009 tax increases, the budget hole got bigger by $9 billion.

That’s because the tax increases keep assaulting the California economy. What does Skelton think happens when money is siphoned off from productive citizens and businesses and handed over to counter-productive government functionaries? The money is misallocated, the economy doesn’t produce enough, and so the tax base actually shrinks.

Then there’s AB 32, the global-warming jobs-killing bill, which really hits hard in 2011.

The U.S. Census just showed that, for the first time in the state’s history, California won’t get any new congressional seats. That’s because this is not a growing, but a shrinking, state.

Sure, Silicon Valley still attracts high-paid geniuses to Google, Apple, etc. But that’s the only area that’s growing.

Skelton wants another tax increase next year. He’ll probably get it. The gimmick this time is that the money would go to local governments. The state government then could stop raiding local funds. But any tax increase will only make everything worse, including the deficit.

The state will cut spending sooner or later by at least $20 billion. More taxes won’t help, but will only drive out taxpayers and make even more spending cuts necessary.

The state government is a vast parasite that must be cut to save the host. It will be cut.

Dec. 23, 2010

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