Why not cut spending instead of raising taxes?
As a former budget director for the Senate Republicans, I ask myself this question every time we face a deficit – Why not cut spending instead of raising taxes?
Today Governor Schwarzenegger called a special session of the Legislature to address an $11.2 billion shortfall in state General Fund revenues. This shortfall is so sudden and so severe that we have to act immediately, and we have to both cut spending and raise taxes.
When Governor Schwarzenegger came into office, General Fund spending was $78 billion. If all the cuts proposed by the Governor in the special session are adopted, we will spend $99 billion this year, which equates to a 4.77-percent annual increase. The amazing thing about that number is that it is actually a bit less than we would be allowed to spend if the Republican "hard spending cap" had been in effect when the Governor took office. Specifically, population and inflation growth over that time was 4.84 percent annually on average.
Taxes!! And Questions??
Governor Arnold Schwarzenegger declared California has a revenue problem and he plans to fix it by increasing taxes. But his tax increase proposals raise a number of questions.
The tax increases will come most notably in the form of a temporary sales tax of 1.5 percent for three years and adding sales taxes to certain services such as appliance and furniture repair, vehicle repair, veterinarian services, amusement parks and sporting events. In addition, an oil severance tax placed upon oil producers in the state; and increased taxes on alcohol at a nickel-a-drink.
Few should be surprised that the governor proposed a sales tax increase. After all, he pushed a sales tax proposal during the prolonged budget negotiations over the summer. However, he’s upped the ante this time—a 1.5-cent increase for three years. His office says that will bring in $3.5 billion for the 2008-2009 General Fund by the time it is implemented.
Prop 8 is Unconstitutional – You Heard It Here First
I know a whole boatload of money was thrown behind the gears of the initiative process to produce the result we all have read about in the newspapers. But, I want to be the first, before some Judge officially proclaims it, to tell you that Prop 8 is unconstitutional. Dead in the water; pulled up lame at the starting gate; kaput.
You cannot disenfranchise a segment of the population who are guaranteed constitutional rights by the state and federal constitutions by amending the state constitution to say so. California tried that with Prop 14 in 1964, which purported to amend the California state constitution to overrule the 1963 Rumford Fair Housing Act, to allow sellers of real estate to sell or not sell to anybody they chose, i.e., to make housing segregation legal by personal choice of the seller. The U.S. Supreme Court held Prop 14 unconstitutional three years later in the case of Reitman v Mulkey, as a violation of the Fourteenth Amendment to the U.S. Constitution.
I predict, and you heard it here first, that the same California Supreme Court that held that denial of the right to marry to same-sex couples is a violation of the Equal Protection constitutional right will hold that Prop 8, by attempting to amend the state constitution to behead this burgeoning social upheaval, is unconstitutional.
What We’re Not Being Told about Changing UC’s Admissions Standards
The University of California Board of Regents is considering a set of sweeping changes to the UC system’s admissions criteria. Among the proposed changes is the elimination of SAT Subject Tests as an admissions requirement. Unlike the more comprehensive SAT, subject tests are focused on one of 20 different academic areas ranging from physics and chemistry to languages and fine art.
Critics of subject tests argue for maintaining high academic standards and promoting diversity. A closer look tells a different story, one the regents and the UC Board of Admissions and Relations with Schools (BOARS), which proposed the changes, aren’t talking about.
A September 2008 report from the National Association for College Admission Counseling noted that, “there are tests that, at many institutions, are more predictive of first-year and overall grades in college and more closely linked to the high school curriculum, including the College Board’s AP exams and Subject Tests.” Eliminating subject tests in light of this research defies common sense.