Jerry's Real Plan: $25 billion in Cuts?

John Seiler:

Looking over Katy Grimes’ budget piece today on Jerry Brown’s testimony before the Legislature, “Is An All-Cuts Budget Ahead,” I was wondering: Does he want his tax increases to fail? Has he all along planned to have an all-cuts budget?

If Republicans don’t put his tax-increases on a special June election, then he can blame them. “Those mean old Republicans forced me to cut $25 billion instead of just $13 billion,” he could say to his union allies, who helped elect him.

If Republicans do allow a tax vote on a June ballot, and it fails, then he can say to his union allies, “I’m sorry, but the voters have spoken. There’s nothing more I can do but cut.”

Would his tax increase be rejected by voters? Almost certainly. If a vote is held, the unions and their allies around the country would raise tens of millions in favor of it.

But anti-tax groups, led by the Howard Jarvis Taxpayers Association, would rally their troops against a tax increase. Burned in the November 2010 election, when they won nothing statewide, California Republicans would rally against the tax increase. The Tea Parties in this state, who didn’t have much effect last year, would find a cause to rally around.

And the election would go national, bringing in tens of millions of dollars from both unions and anti-tax groups.

Jerry Brown knows more about California politics than anybody. Ex-Gov. Pete Wilson is close, having beaten Brown in a U.S. Senate race. But that was in 1982, almost 30 years ago. Brown just won an election for governor, and four years earlier was elected attorney general.

He knows, I think, that tax increases wouldn’t really solve the problem. When Gov. Schwarzenegger signed the $13 billion tax increase two years ago, that was advertised as solving the state’s budget problems — but sure didn’t, as here we are again with a $25 billion deficit.

Brown also is aware how taxes affect economic production. That’s why, in his 1992 presidential campaign, he backed a flat-tax proposal designed by economist Arthur Laffer, who had helped design President Reagan’s tax cuts.

So, Brown may be reasoning (in my speculation): Call for tax increases. They don’t happen. Then the $25 billion in spending cuts are inevitable. If the cuts occur, when the national economy finally recovers, California’s economy will take off and produce a surplus. Use the surplus to restore some of the cut spending — but also for tax cuts to keep business growth moving.

With the luster restored to the Golden State, Brown wins easy re-election in 2014. And — you read it here first — runs for president in 2016. True, Jerry would be 78 then. But Ron Paul, who’s readying a 2012 presidential bid, will be 76 next year. Ronald Reagan was inaugurated for his second term in 1985 just days shy of turning 74.

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  1. stevefromsacto
    stevefromsacto 26 February, 2011, 10:02

    I don’t often agree with Eric Hogue, but he is on target here. The Republicans are blowing the best opportunity they will ever have to bring real reforms to state government. Check it out.

    While Republican heads continue to fall, Los Angeles radio station KFI’s afternoon shock jocks John and Ken laugh all the way to the bank. Warning to all Republicans; these boys are not Republicans, and they don’t give a damn about the future of the GOP. All these boys care about is producing shocking talk radio and boosting their ratings while choking a party to death.

    It was their very own “heads on sticks” campaign that helped produce the Democratic majority in Sacramento to begin with.

    Question: Considering that it’s Gov. Brown’s budget proposal for a tax increase proposition, will they put their own “heads on sticks” for their November gubernatorial performance?

    Fourteen days ahead of Brown’s self-imposed budget deadline, Republicans create a “Taxpayers Caucus” in order to out fellow Republicans who “may negotiate a deal” to place Brown’s tax extension proposal on a June special election ballot.

    If I am wrong, then someone needs to explain to me the great urgency to be booked on John and Ken’s afternoon headless charade just a few short hours after the initial press conference. It all seemed orchestrated; the logical conclusion, to allow these shock talk hosts to take out their sharp tongues and decapitate their very own caucus members. Don’t we understand that these myopic boys are pushing GOP politicians into positions that will doom the party?

    What Republicans need are leaders able in negotiations for good, prudent governance. What we don’t need is two wild-eyed independent shock jocks earning high ratings at the expense of Republican branding, chemistry and leadership.

    All these boys care about are their ratings and contracted bonus checks – cashing these stipends while sucking the last evidence of life from a party they couldn’t care less about. The Republican minority needs serious dialogue involving solutions if we’re ever going to work toward being a majority party in the near future.

    The voters of California handed Republicans a silver budget bullet in November. Republicans have an opportunity to secure government, union and regulatory reforms never before imagined. But we seem more concerned about who is, and who is not, in good membership with a new Taxpayers Caucus whose bylaws forbid any support of placing a tax proposition before the people of California.

    Republicans have been given a sincere opportunity to negotiate reforms with the governor that would drastically change public employee unions and their pensions, reducing numerous regulatory barriers killing the business and private sector, and ultimately implementing a real spending cap limiting government while greatly mitigating the effects of AB 32. And at the same time, we can still fight for the defeat of taxes placed by Brown at the ballot.

    Hear me out: nobody wants new, continuing or additional taxes – and nobody is saying Republicans must support any tax proposition that hits the ballot. But know this, when you are given a moment in time you stand up for the future of your party and California, and you earn the right to govern in a majority. You don’t run to two independent radio entertainers to out fellow party members, while great Republican leadership is being exampled in states such as Wisconsin, Ohio and Indiana.

    True conservatives would be using this opportunity for the future of the state. In fact, Gov. Ronald Reagan would consider it a sin against conservatism to let this moment pass. Even more egregious: allowing two self-concerned shock jocks to spend this rich Republican opportunity on themselves.

    Read more: http://www.sacbee.com/2011/02/26/3431920/republican-beheadings-are-killing.html#ixzz1F5aRyJRE

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  2. Tylerle13
    Tylerle13 26 February, 2011, 13:13

    Steveo, I think you are putting a little too much emphasis on what is being discussed on talk radio.

    The Republicans who are holding out answer to their constituants, and those constituants put them in power under the promise that they would not raise taxes or assist in facilitating anything that would raise taxes. They made a promise to the people they represent and there is no excuse for them to flip the bird at their constituants just because Jerry doesnt want to make the cuts that are neccessary to our bloated state budget.

    The fact that you are acting like you care about the future of the Republican Party is laughable. All you are looking for is for a few termed out Republicans to fall on their sword and “make a deal” for some symbolic “Reforms” that will never happen, in exchange for a cushy appointment to a do nothing state agency, so the outrageous spending can continue.

    California has some of the highest taxes, the most damning regulatory environment, and a ridiculous unemployment rate, all at the hands of the “Tax & Spend” mentality that has been carried out by our legislature. It is evident that the answer to repairing our state is not to raise taxes again in order to band-aid the real problem, which is a bloated, over-reaching, & wasteful government. Cuts need to be made so the government is trimmed to a reasonable & sustainable level instead of treating the hard working people of California as an ATM for wasteful spending.

    Those changed & reforms that you insist should be used as bargaining chips for a tax increase are changes that should have been made years ago. The fact that they are being held hostage & used as bargaining chip in an attempt to rape the people of California out of $55 Billion is a disgusting example of the unethical manor in which the politicians in this state have turned their back on the people of CA in order to pander to the unions for campaign contributions.

    If the Dems really cared about the people of California, They would be working on those reforms regardless of whether or not the tax increases go on the Ballot. The reforms are neccessary for the long term health of the state and it is the right thing to do for the people of California. If the Dems insist that they will only do the right thing for the people & the State if they are allowed to screw the taxpayers to appease the unions, then they have no right to be governing this state. They tried to tax & spend method 2 years ago and now instead of a $6 Billion hole, we have a $26 Billion hole, so that clearly didnt work. The people told them 2 years ago, by a 2:1 margin that there was no more money we were willing to give, so there is no point in wasting millions of dollars to ask again when people are hurting even worse.

    We have suffered as much as we can and now it is time to cut the fat out of the bloated budget. There are plenty of programs & agencies that shouldnt exist so take an ax to those ones first. The other agencies will have to learn to get by with less, just as the rest of us have been doing for the last 5 years. The bottom line is that there is nothing more that we can give. They have a good run of living lavishly, but its time to face the facts, their way of doing things is not sustainable and has to come to an end.

    Reply this comment
  3. chris
    chris 26 February, 2011, 15:55

    totally agree with you Tyler. The money pit that is the LAUSD and unions run the state. Jerry Brown has to try to pass the tax extensions in order to make good on his promise to his owners. The unions will spend millions upon millions trying to have these taxes passed. The Howard Jarvis taxpayers association will not be able to match their spending dollar for dollar, so knowing the California voters history of voting against the own interest. We are sure to see our taxes stay high. I fear the worst is yet to come if the Republicans don’t hold sted fast again this. On a side note Jerry Brown is the person that gave the unions all this power during his last term as governer.

    Reply this comment
  4. John Seiler
    John Seiler 27 February, 2011, 11:08

    “Republicans have been given a sincere opportunity to negotiate reforms with the governor that would drastically change public employee unions and their pensions, reducing numerous regulatory barriers killing the business and private sector, and ultimately implementing a real spending cap limiting government while greatly mitigating the effects of AB 32. And at the same time, we can still fight for the defeat of taxes placed by Brown at the ballot.”

    Steve: You have a point. But Republicans have been burned so many time on taxes, ESPECIALLY by their own leadership — Gov. Wilson in 1991 and Gov. Arnold in 2009 — that they understandably are leery of getting snookered again.

    Reply this comment

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