The California Taxpayers’ Association has released a second edition of Dave Doerr’s California’s Tax Machine, an up-to-date history of how California taxes its citizens. Doerr, chief tax consultant at Cal-Tax since 1987, started working for the Assembly in 1959 holding many positions, including chief consultant to the Assembly Revenue and Taxation Committee. The new edition, a year in the making, includes new information on the Davis and Schwarzenegger administrations’ tax policies along with updates on some of the historical material included in the 2000 first edition.
Doerr hopes any new tax commission set up by the Legislature or the governor reads through the book before beginning work. “You can’t really begin to fix things unless you know how they went wrong and what the problems are and how they developed. Then they start to see how they can get out.”
Doerr’s 800-page volume begins with the Spanish Rule in California but quickly gets into the tax policies of today and how they developed over the years. If one tax issue has stood out over time for Doerr, it has been trouble with the property tax starting in early statehood and running right through the Proposition 13 tax revolt. Doerr noted that a referendum in 1859 to split California in two was driven in large part by the heavy property tax burden in the southern part of the state. The issue of two Californias was transferred to Congress but was lost among rising tensions of the coming Civil War.
Thinking about a possible new tax commission, Doerr said, “It would be helpful for the commission to understand some of the pitfalls. We’ve had tax commissions before. Mainly the 1906 to 1910 (University of California Professor Carl) Plehn commission, which produced the goofy separation of sources, which was a disaster. Another tax commission in the 1920s recommended reversing it. More recently, we’ve had tax commissions which haven’t accomplished anything. Governor Deukmejian had one. There was another one not too long ago. They didn’t come up with anything viable. They were stuck on trying to reverse Prop 13 or stuck on tax raising issues.”
Doerr is concerned with the current budget and says the process is a big part of the problem. “With the last budget, no one knew what was in the bill that was voted on. No hearings; no analysis. So how does the public have input?”
In his days in the Assembly, Doerr said there was more collegiality with those inside the building reaching out to involve all interests in solving tax issues. “That’s what I used to do when I was with the committee. I could get consensus on major issues. Nobody reaches out across the street. It’s all done in house. If you had a more collegial process everyone is working to solve the problem. The Legislature needs to be working with all interested parties.”
As for raising more revenue for a deficit ridden state, Doerr notes, “The big increases in revenue the state has enjoyed have come from economic growth not so much from tax increases. That’s pretty clear if you look all the way through history.”
Doerr’s effort on California’s tax history was the first since an Assembly committee put together a much shorter booklet in 1955. Doerr’s work is considered a classic in the field of taxation.
To order a copy of the book, go to the Cal-Tax website.