Give
Governor Jerry Brown credit. He’s smart enough to recognize that imposing
massive property tax hikes on California’s struggling job creators will hurt,
not help, our state’s economy. And he’s willing to take heat from members of
his own party for his stand.
On August 16, Los Angeles Mayor Antonio Villaraigosa gave a speech to the
Sacramento Press Club urging "progressives" to "start thinking and acting big
again" in order to "invest… in our economy." He challenged Governor Brown to
have "the courage" to "strengthen" Proposition 13, an important taxpayer
protection measure approved by voters in 1978.
Lest anyone be confused, let me translate: Mayor Villaraigosa has no intention
of "strengthening" the property tax protections in Proposition 13. Instead he
wants to strip away those protections for business owners, including Main
Street mom-and-pop businesses like hair salons, hardware stores and
restaurants.
According the Howard Jarvis Taxpayers Association, an organization that exists
to defend Proposition 13, prior to that measure there were no limits on
property tax rates and assessments. Taxpayers’ properties could be reassessed
50% to 100% in a single year and see their bills jump accordingly. As a result
many taxpayers lost their homes and businesses.
At a time when taxpayers are once again losing homes and businesses, it makes
no sense to make the problem worse. The businesses we see when we drive down
the street are survivors of the Great Recession, but that’s no guarantee they
will be able to continue to keep their doors open and workers employed.
Yet Villaraigosa and others want to target these survivors. Apparently for
"progressives" the definition of "progress" is to make California first in
taxes and unemployment.
According to the Tax Foundation, Californians bear the sixth highest overall
tax burden in the nation. Our state’s income taxes, sales taxes and fuel taxes
rank at or near the top. Even property taxes aren’t particularly low-California
ranks 14th-but without Proposition 13, they would be much, much higher.
Taking even more money from private taxpayers to "invest" in more government
bureaucracy doesn’t grow our economy. Instead, it would shrink it. The taxpayer
would have less money to spend, invest, and hire workers. And our state would
end up with even higher unemployment.
The vast majority of jobs and investment in our state come from the private
sector, not from government. In fact, even public sector jobs and investments
only exist because the private sector pays for them.
Like it or not, California is in a global competition for jobs. Many California
businesses can no longer afford to expand. The cost of doing business in our
state is already too high compared to other states. As a result, many taxpayers
are leaving our state for greater economic freedom elsewhere. According to a
recent study, California is experiencing a net loss in new business startups,
falling from first in the nation to a dismal rank of 50th last year.
If our state’s leaders want more revenue for public sector investments, they
need to attract more private sector investment. There are no shortcuts. Only a
healthy, vibrant economy that creates jobs for Californians will produce tax
revenue in abundance.
A good place to start would be for Governor Brown and the Legislature to launch
a comprehensive review of the costly regulations burdening private sector
businesses. Commonsense reforms could free up millions of public and private
sector dollars. A similar effort at the federal level recently found savings of
$14 billion.
Making government less costly, intrusive and burdensome for taxpayers is one
way to start restoring public confidence.
California’s leaders must confront the truth that taxpayers don’t trust
government to "invest" their tax dollars in a wise manner. Years of government
mismanagement and wasteful spending have caused the public to rightly doubt
claims that additional taxes and government spending will solve the problems
facing our state.
Big thinking is good, but bad thinking is not. If we truly want progress, we
need to start viewing private sector taxpayers as a partner, not a piggybank.
And if we truly care about Main Street, we’ll keep Proposition 13 whole.
Elected in November 2010, George Runner represents more than nine million
Californians as a member of the State Board of Equalization. For more
information, visit www.boe.ca.gov/Runner.