Author: Jon Coupal

The phrase “feeding the alligators” is a metaphor about the dangers
of appeasement. One may be able to buy temporary peace by feeding a
threatening alligator, but the problem is that the alligator will,
sooner or later, get hungry again. And because it was previously
fed, it is now larger and more dangerous.

Regrettably, the California business community has often chosen to
feed the ever-growing alligator of government when it comes to
important political battles. Thirty-one years ago, California
business interests were united in their opposition to Proposition 13
due to fear that if homeowners received tax relief, the Legislature
would try to make up the difference by raising levies on them. For
short term protection for themselves, business was willing to feed
average taxpayers and homeowners to the alligator.

In normal times, political institutions generally reflect the
members they serve. In theory, a legislative body reflects the
combined wisdom and experience of its elected representatives. And
those representatives, again in theory, reflect the views of the
citizens who elected them. The same can be said of virtually any
organization, whether a labor union or a political party.

But every now and then, those in the leadership positions of
political institutions, for whatever reason, become disconnected
with the very people they purport to represent.

Perhaps the clearest example of this occurred in 1978 with
Proposition 13. It is hard to fathom the depth and breadth of the
stated opposition to the measure. Virtually every organization in
California had taken an opposing position. Virtually every editorial
board, all business organizations (including the California Chamber
and the California Taxpayers Association), all labor organizations
and, of course, the entire academic brain trust from our world
renowned universities campaigned vigorously for the defeat of
Proposition 13.

When you buy a pair of shoes, you assume that the price you pay
includes the store’s cost for the footwear and a profit margin on
top of that. However, when you pay your water bill to a government
agency, you do not expect a profit margin to be built into the
price. But if you live in Los Angeles, that would be wrong.

The City of Los Angeles has a long-standing practice of skimming
money off the top of the customers’ water bills.

The Howard Jarvis Taxpayers Association has just concluded a legal
case that may put an end to this practice once and for all. In
encouraging news for Los Angeles water customers, on March 25th the
Los Angeles Superior Court issued a tentative ruling in LA vs. All
Persons finding the City’s practice of padding water bills to pay
for unrelated City expenses to be unconstitutional.

All those who favor putting the breaks on Sacramento’s ability to overspend, please raise your hands.

I see that is most of you. Those against? I see a couple of public employee union bosses over in the corner are opposed.

Well those Sacramento politicians who made a "deal" last month to resolve the budget process with a tax increase that will cost the typical California family over $1,100, are offering another deal they hope will appeal to the majority of you.

What they are offering is Proposition 1A on the May 19 Special Election ballot. 1A is being promoted as a spending limit that will compel those under the Capitol dome to behave responsibly.

If taxpayers are wary of any offer of reform coming from those who have behaved so irresponsibly that they have run up a $42 billion deficit, their suspicions are justified.

Rumors abound that the Big Five have agreed in concept to a budget solution. As the details of the plan are presented to the legislators who will have to vote on it, taxpayers hope that those who call themselves fiscal conservatives remember a few basic principles.

First, it is far better to have no budget solution at all than to acquiesce to a bad budget solution; i.e., one that adds to California’s already crushing tax burden. This is not to advocate for continued gridlock. This is to advocate for the economic survival of the state.

We are cognizant of the substantial political pressure from many corners to get a deal – any deal – no matter what the merits. And the fear has been expressed that the failure to address quickly the severe cash flow problem will hurt Republicans because they are more likely to be portrayed by the MSM as the obstructionists. In short, the “optics” of some tragedy – for example, the death of a recipient of in-home health services – is more likely to hurt those who hold the line on taxes.

A couple of weeks ago, the governor and legislative leaders took
time out from the self-proclaimed budget crisis — the governor has
called it “financial Armageddon” — to journey across the continent
to participate in the inaugural festivities. Although we have our
doubts about President Obama — starting with the pork laden
stimulus package — there were a couple of nuggets of wisdom in his
inaugural address.

To begin with, Obama praised the selflessness of workers who, to
help us get through dark times, “would rather cut their hours than
see a friend lose their job.” This, of course, is anathema to
Assembly Speaker Karen Bass and Senate Pro Tem Daryl Steinberg.
While supporting higher taxes for all, they have been staunchly
resisting the governor’s proposal that state workers take an unpaid
two-day furlough each month to help us through our cash flow
problem. This, in spite of the fact that the Census Bureau lists
California public employees as the highest paid in the nation.

Humans have been around for tens of thousands of years. And yet, as recently as a thousand years ago, there was a broad consensus — even among the most highly educated — that the world was flat. The problem with "consensus" is that it becomes groupthink. If an idea has no challengers, it becomes difficult to disprove and those who speak against the established orthodoxy are always marginalized.

There seems to be a consensus in California that we have a "Budget Crisis." But if "crisis" is defined as a situation where impending disaster is a probable outcome — think Cuban Missile Crisis – then the notion that California is in the midst of crisis needs to be challenged.

In perhaps one of the most brazen political moves in California history, Democrat leadership yesterday unveiled a budget proposal that would shred the California Constitution by raising billions of new taxes without the required two-thirds vote.

The tax hikes in the proposal would include a 2.5% surcharge on anyone paying personal income tax, an additional three quarter of one percent sales tax, an oil severance tax and replacement of current taxes on gas with even higher “fees.”

We have no idea who is providing legal advice to the democrats, but they should have been informed before launching this silly proposal that, not only would a lawsuit be inevitable, the challenge would also succeed in preventing the taxes from ever being imposed.

What are the Democrats thinking? The two-thirds vote requirement, one of the most important provisions of Prop 13, clearly provides that “any changes in state taxes enacted for the purpose of increasing revenues collected pursuant thereto whether by increased rates or changes in methods of computation must be imposed by an Act passed by not less than two-thirds of all members elected to each of the two houses of the Legislature.”

Another week, another special session of the Legislature.

California faces a nearly $30 billion shortfall over the next year
and a half and, to address this crisis, last month the governor
leaned on the outgoing legislators to stay to the final hour in the
hopes of coming up with a solution that included both spending cuts
and tax increases.

Because the special session ended in stalemate, the governor
declared a “state of fiscal emergency” and has called on members of
the new Legislature, who took office December 1, to try again.

Although many lawmakers are carryovers from the previous session,
Schwarzenegger is repeating his mantra that Democrats and
Republicans must leave their ideology at the door. Democrats don’t
want to cut spending and Republicans don’t want to raise taxes, he
says, and the parties must reach a compromise.