Is Arnold Schwarzenegger the most conservative, anti-tax governor in the history of California?

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

Those who followed the recent California Forward panel, and accompanying LA Times pieces, on how four previous governors — Earl Warren, Pat Brown, Ronald Reagan and Pete Wilson — resolved budget difficulties might have reached that conclusion. A different author described how each governor had had the courage to raise revenues to support a growing state.

The tax numbers on Reagan, offered by biographer Lou Cannon, are jarring in light of today’s debate. Please tell the Republican kids, if there are any Republican kids anymore. Taxes on corporations went from 5.5 to 9 percent; the tax on banks from 9.5 percent to 13 percent, and the highest rate on personal come tax jumped from 7 percent to 11 percent.

If Reagan rose from the dead and tried that today, Republican lawmakers would shun him, and every anti-tax group in the state would be racing to the attorney general’s office with recall papers.
What about other governors? Deukmejian held the line, sort of. He supported a temporary sales tax increase that was repealed — because of a surging economy — before it ever had to go into effect. Gray Davis cut taxes at first, but then raised the dreaded vehicle license fee, or "car tax."

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Environmental Elitism: America’s New Religion

Patrick Dorinson
Host of The Cowboy Libertarian Radio Talk Show in Sacramento

The other day President Bush called for more exploration of America’s domestic oil reserves including off the coast of California and ANWR in Alaska. In my opinion this was long overdue but better late than never.

Our esteemed Senator Feinstein immediately went before the cameras waving the “bloody shirt” of the 1969 Santa Barbara Oil Spill saying to the Associated Press,"Californians are all too familiar with the consequences of offshore drilling," Feinstein said. "An oil spill in 1969 off the coast of Santa Barbara killed thousands of birds, as well as dolphins, seals and other marine animals. And we know this could happen again."

That spill happened almost 40 years ago and there have been no major spills from oil platforms off the coast of California since that time. During Hurricanes Rita and Katrina in 2005 the almost 4,000 oil rigs in the Gulf of Mexico reported some major damage and many rigs were lost, but there were no major spills.

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Why is everyone so angry?

Loren Kaye
President of the California Foundation for Commerce and Education

Californians are angry – at least that’s the conventional wisdom.

Surveys by the Public Policy Institute of California and Field Research Corporation find Californians deeply pessimistic: less than a quarter of voters believe the state is heading in the right direction.

Californians are grumpy about the economy, too. Nearly three quarters of adults believe the economy will be in bad times for the next year. Voters have a low opinion of their elected officials and are critical of institutions such as the schools.

But just how deeply entrenched is this anger?

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The LA Teachers’ Walkout from a Teacher’s Point-of-View

Joel Fox
Editor and Co-Publisher of Fox and Hounds Daily

This site has featured commentaries from two of our bloggers (Joe Mathews and Matt Klink) on the one hour walkout of the Los Angeles teachers union to protest the education funding proposal in the governor’s budget. Now comes a look at this issue — as well as a broader view of teachers’ unions — from an insider. Doug Lasken, an English teacher in the LAUSD, penned this article for the Los Angeles Daily News. It’s well worth the read.

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Governor Commits to Preserve R&D Tax Credit

Chandra Sharma
Political Communications, Redistricting and New Media Strategist

Check out today’s commentary by Flashreport editor Jon Fleischman: Governor Commits to Preserve R&D Tax Credit In State Budget

An excerpt:

The credit should not only stay in place, but California government should be looking for more opportunities to reduce regulation and costs to business in California to encourage research and expansion. 

I agree wholeheartedly; California must strive to maintain its role as America’s leader in technological innovation, and in order for that to happen, we must reduce costs for the businesses who are working hard to keep our state in the lead.

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On the Road Again: Braving rental cars and bad coffee on the Summer of Small Business Tour

Rosario Marin
Former Secretary of California State and Consumer Services and 41st Treasurer of the United States

Last month, I attended the Orange County Small Business Council for a roundtable discussion on how small businesses are faring with state contracts. The Council is comprised of four prominent chambers of commerce in the region. After I opened the meeting, detailing the progress that the state has made in contracting with small businesses and existing incentives, the room was eerily silent. Slowly, board members began acknowledging that they had no idea that the state was so eager to do business with small businesses. Few were familiar with the Executive Order Governor Schwarzenegger had put out calling for the state to use at least 25 percent of it’s massive purchasing power with small businesses and disabled veterans business enterprises (DVBEs).

I couldn’t believe it; I knew it was time for my agency to take its show on the road.

We all know about the doom and gloom that is being reported on the nation’s current economic state, so it is especially important in these tough times that California’s businesses know the state is focusing on increasing its small business and DVBE contracts. After leaving the roundtable discussion, it became clear that bad hotel coffee and rental cars awaited me. Our state’s small businesses need to hear it from the real McCoy: California is open for business.

Each day 6.8 million Californians – half our state’s workforce – go to work at small businesses across the state. Their work in construction, manufacturing and service industries allow the small business sector to grow and drive our economy.

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New Majority calls for Real Budget Reform at Media Roundtable

Joel Fox
Editor and Co-Publisher of Fox and Hounds Daily

Individuals from the New Majority, the powerful and well-heeled business executives’ organization dedicated to electing mainstream Republicans, could support revenue increases but only if accompanied by real budget reform.

While not an official position of the organization, some of the Orange County chapter’s leaders said at a media roundtable in Costa Mesa yesterday that if a revenue increase were the price for true reform to solve the continuing budget crisis, then the organization would consider such a package.

Membership Chairman Paul Folino compared fixing the state budget mess with turning around a floundering company. He said one has to be mindful of both the short-term fixes as well as making things work in the long term and getting away from the circumstances that plagued the company.

While the organization doesn’t take positions on legislation, Orange County New Majority Chairman Tom McKernan said his sense from talking to other New Majority members is that many could agree to new revenues for the state if they were tied to long-term budget reforms, such as a spending cap.

But, in considering any revenue package, McKernan said, the group would not accept any proposal that would harm business or cause more middle class Californians to move out of the state.

McKernan emphasized that the group would have to be certain that the reform was real. He said the group had no intention of being double-crossed by the Legislature again.

He was referring to New Majority’s effort to help fashion and then support a package of redistricting and term limit reform to be placed on last February’s presidential primary ballot.

In the end, Legislative leaders only put a term limit initiative forward, Proposition 93. The New Majority refused to back a stand-alone term limit measure and the group and its members ended up donating about $500,000 to help defeat it.

The New Majority members are now backing the redistricting initiative that just qualified for November’s ballot. The group helped to jump-start the signature drive on the initiative petitions with a hefty donation.

Indicating frustration with dealing with the Legislature, Political Affairs Chairman Dwight Decker said while not giving up its efforts with the Legislature, the group planned to increase its focus on policy changes to be made through the initiative process.

The New Majority now has four chapters in Los Angeles County, San Diego County and the Inland Empire as well as Orange County. The group hopes to expand in the San Francisco Bay Area and the Silicon Valley soon.

The New Majority PAC is focusing on a handful of California general election races with the goal of making sure that the Democrats do not achieve a two-thirds majority in either house.

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California Voters FIRST Act will get California on the Right Track

Former California State Controller and Businessman

Among the many measures that will appear on this November’s ballot, one of the most important is the California Voters FIRST Act. On Election Day, Californians will have the opportunity to send a message to their elected officials and to make sure their votes count in passing this important redistricting reform measure.

Year after year, partisan gridlock prevents our state lawmakers from effectively addressing the issues Californian’s care about most, including the state budget, health care, education, the economy, the impending water crisis, and the environment. Contributing to this ongoing problem is the fact that Legislators are allowed to draw their own district lines to guarantee their reelection. As a result, our lawmakers are simply not accountable to voters. In fact, even as legislative approval ratings are at historic lows, nearly 99% of incumbent legislators are reelected every year.

The California Voters FIRST Act will end the conflict of interest that exists in our current redistricting system and help put voters back in control and make lawmakers accountable to their constituents. The initiative will change the way legislative districts are drawn by creating a 14-member independent redistricting commission, including five Republicans, five Democrats and four members not affiliated with either major party. And, unlike the current process, the California Voters FIRST Act will ensure that the redistricting process is open, transparent, and protects the Voting Rights Act.

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A Split Property Tax Roll is a Bad Idea

Joel Fox
Editor and Co-Publisher of Fox and Hounds Daily

Not surprisingly, considering the size of the projected state budget deficit, some are calling for tax increases that are unique or rarely heard: A tax on beer, on iTunes and movie downloads, even on strip clubs. Then there is the old standby—raise business property taxes; Peter Schrag called for an increase of business property taxes in his column yesterday in the Sacramento Bee.

This effort is commonly called the “split roll” because the idea is to split the property tax roll placing residential properties in one category and business properties in another while increasing the tax rate or assessment requirements that will tax business properties more heavily.

Even when Proposition 13 was on the ballot in 1978 an alternative was offered to the voters to treat business property differently from residential property. That measure went down to defeat. Since then a number of efforts to create a split roll have gathered signatures. The one to reach the ballot was defeated.

A split roll has not been passed for very good reasons. Those reasons have not changed even with the shadow of a large budget deficit hanging over the state. In fact, considering that the budget deficit is the result of a sour California economy there are even more sound reasons to reject the idea of a split roll.

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Back to the future? Not so fast..

Fred Silva
Director of Public Policy, California Forward

Joel Fox wrote an interesting piece yesterday about returning to the budget approval process that was in place from 1933-1962. Oh, if life and budget making were so simple…

The so called current services budget format simply tells us what the Governor thinks it will cost Californians to pay for our collective statutory and constitutional spending requirements. In the post-WWII period, life was neat and simple and so was the current services format. The state’s obligations were small with a significant portion of the general fund expenditures going to infrastructure.

Today, current services budgeting has a whole new meaning. It is filled with entitlements, caseloads, judicial requirements and pesty lobbyists. If we could find a way to measure the value of a dollar spent rather than the simple measurement of the growth in spending, some progress toward budget reform could be made.

If the Legislature and the Governor could find the magic number that would fund contemporary current services and produce value for the dollar spent, the idea of a vote requirement that is linked to state spending might be worth the time required to make it work.

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