Higher Taxes Don't Make Us Better

JUNE 13, 2011

Gov. Jerry Brown’s recent talk to the California State Association of Counties was more meandering and disjointed than usual, but the governor stuck to his talking points: Unless California voters approve tax extensions, they must get used to greatly diminished public services. Without at least the tax extensions, he said, “we will get a radical restructuring of what we are.”

This summarizes in a phrase the ideology of Brown, the Democratic Party and the unions that spent at least $30 million electing him governor.

To them, California’s greatness does not come from our entrepreneurship. It is not based in any concept of individual freedom. It doesn’t stem from the state’s history or its people.

It is about government. To cut any of it means a fundamental restructuring in who we are as a people. Cutting or reforming government, in their view, makes us less decent and less humane.

Republican Position

Unfortunately, this also appears to be the default position of many Republicans, given that the latest news reports suggest that a handful of GOP legislators are ready to buck their party leadership and support the governor’s plan to put taxes to a public vote —- a tax vote that will be championed by the public sector unions and their deep pockets and could therefore have a fair shot of passing a September ballot vote.

Yet, wherever I look, I see government agencies steeped in incompetence and corruption. I see a surly public sector that refuses to embrace fiscal reform and unions that protect even the most incompetent and corrupt members.

Americans used to understand that the private sector, whatever its faults, is where one finds innovation and where the customer is best served. To this state’s political players, the private sector is a scourge and the public sector —- the mostly unaccountable, inefficient and irredeemable bureaucracies —- form the heart of who we are as a people.

“Half of the babies born in our state are born through the MediCal system,” Brown said at CSAC. He said that his fellow Democrats see the level of poverty increasing and a lack of adequate health care. They believe that “we as a people have a real obligation, a link to all the people of California.”

“Should we do less?” he asked, with “we” meaning the government and doing less means failing to increase the size of state bureaucracies to handle these endless needs.

“God knows there is waste,” he admitted in a token nod to Republicans. But instead of proposing ways to stretch public dollars or plans to root out waste and fraud in the state government, or to outsource services to improve efficiencies, Brown rambled on about problems in the private sector: “Look at the private sector, where the average CEO makes $20 million and compare that to elected officials.”

When pressed about the pension debt, public employee union officials and Democratic leaders always point to high salaries at the CEO level in the private sector, but it’s unclear what this has to do with waste and inefficiency in the public sector.

CEOs are not paid by tax dollars, even if many of them seem overpaid. Except with those businesses who seek government handouts and bailouts, private-sector compensation is not a policy problem. Poorly run businesses go out of business. Poorly run agencies get more of our money and are allowed to run up unfunded liabilities.

$62 Trillion Debt

Consider this news from USA Today a few days ago regarding an estimated $62 trillion (yes, trillion with a “t”) that the U.S. government has run up in debt: “Corporations would be required to count these new liabilities when they are taken on — and report a big loss to shareholders. Unlike businesses, however, Congress postpones recording spending commitments until it writes a check. The government has run up debt levels that amount to $527,000 per household.”

Yet to Democrats, the private sector is the real problem. Brown even looked on the bright side. He said “we’re at a very good spot,” pointing to California’s current estimated $9 billion deficit as “a peanut compared to our overall wealth.”

He said California’s deficit is nothing compared to the deficit at the federal level. That’s true, but I’m not feeling much better.

“We must summon the courage to make the tough choices,” Brown said. But where is his courage?

Instead of taking on the powerful California Correctional Peace Officers Association, he gave away the store, allowing the notoriously ham-fisted prison guards’ union raises and the ability to bank an unlimited amount of vacation time —- something that could cost California hundreds of millions of dollars.

Indeed, state officials are now demanding higher taxes so that they can comply with a U.S. Supreme Court decision mandating a reduction in the prison population in the state’s overcrowded prison system.

But forget about cost savings with the guards’ contract now. Brown’s prison chief is threatening the state with the release of violent prisoners if voters don’t pass his tax-extension plan. This is how the public sector operates — the customer (actually, we’re more like subjects) never comes first.

School Spending

“If you don’t extend taxes, there is a real net loss in education and safety of our communities,” Brown said.

He compared the $6,000 a year received by the state’s public schools to private schools that charge as much as $30,000 a year in tuition. Of course, he understates the total school funding by about 45 percent. The existence of costly private alternatives — increasingly necessary given the incompetence of the public schools — offers no loss to the public sector.

Again, we see that Brown ultimately reviles the private sector and is the representative of the government class.

California and all states need some level of government. But government should not be immune to reform, competition and reductions. Brown’s choices are false.

There are other options other than raising taxes or cutting services. A bigger government does not make us a better people. Until Californians recognize those points, they will face a never-ending call for higher taxes and a continuing decline in our state.


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