Day one of the “State of Emergency” protests by the teachers’ union and others has come and gone and the earth didn’t move. Protests were moderate by capitol standards. The arrests amounted to a sideshow.
Where there was movement was a shift in the policy debate because of the unexpected $2.5 billion that now sits in the state treasury. Republicans in the legislature are proposing to use that revenue to offset proposed education cuts. I expect every teacher who visits a Republican legislator during the protest week will hear that refrain.
What is the teacher’s response? No thank you? Hard to imagine.
The real question about this revenue surge is does it continue? Tax experts I talked to yesterday think it very well could. Remember the deficit that the governor is trying to close is for this year and next year. If the revenues continue to uptick next year then the deficit shrinks further and the governor’s current proposal of $10 billion in yearly new (or, in the governor’s language: extended) taxes will be seen as overkill.
Which brings about the possibility that when Governor Brown announces his May budget revise next Monday he could alter his tax extension proposal.
Perhaps he will suggest that the temporary taxes run three years instead of five?
Perhaps he will say he wants to continue income and vehicle tax extensions but drop the sales tax, or some other combination of ending one tax extension but keeping the others.
Perhaps he will suggest a tax increase trigger if revenues do not continue to improve, something akin to what Governor George Deukmejian did in the 1980s.
I suspect the governor will acknowledge the revenue surge more than his office has so far: that is that the cost side of the budget must be considered before we embrace the increased revenue.
The new revenue news has certainly made the earth move more than the capitol protests.