As featured on p. 218 of "Bloggers on the Bus," under the name "a MyDD blogger."

Thursday, October 01, 2009

Too Bold? How About "Too Absurd"?

At first I thought that the headline writer was confused. "California tax reform plan much too bold for Capitol," it said above George Skelton's column today. "Too bold" could maybe have more than one meaning. Surely Skelton wasn't throwing in with the idea that massively shifting the tax burden to the lowest income levels in society was too good an idea. But I think that is, in fact, what he's saying.

"I would sign it immediately" if it were a bill, Schwarzenegger told reporters. "Without any doubt."

Of course, this is a governor who constantly seeks out things new and bold. And the tax proposal was all of that -- much too new and bold for most Capitol denizens, especially those representing special interests.

As Genest told me: "It shouldn't come as any surprise that lobbyists in Sacramento are in favor of maintaining the status quo unless they are confident that the change will serve their interests. That's why they're called 'special interests.' "

Nowhere in Skelton's article does he quote any figures or statistics citing the practical effect of the Parsky Commission's plans. He doesn't mention that, under the plan, taxpayers making over $1 million dollars a year would save $109,000 annually on average, while taxpayers making between $40,000 and $50,000 would save four bucks. He doesn't mention that the proposal would result in a net loss of revenue to the state, causing wider budget deficits. He does manage to mention critiques of the business net receipt tax from the side of business and industry, but offers no critiques from the opposite end, a la Jean Ross' statement that “You could not say, ‘We’re going to tax child care so we can lower the income tax on millionaires.’ But that’s what this does." The fact that the BNRT would hit business payrolls and disproportionately tax companies in the knowledge economy rather than the service economy also doesn't make it in. Skelton never mentions that, by taxing all businesses in the state, the BNRT would effectively tax rents.

He just says it's "too bold."

The Parsky Commission was practically designed to shift wealth upward. It should surprise nobody that this is what it ended up doing. That is bold, but not in the way that Skelton means it, I don't think.

He does give voice to where Karen Bass may steer the debate:

Bass was holding her tongue, trying not to express disappointment in the commission. When she first proposed its creation, the speaker envisioned the panel proposing something more practical and simple: reducing the sales tax rate and spreading it to currently untaxed services.

She promised a "thorough and objective public review" of the panel's recommendations.

Good idea, but don't stop there.

"My biggest message to dysfunctional Sacramento is to get something done," Parsky says. "If you've got a better idea, get it done."

There's no question that flattening and broadening the sales tax base is a decent enough idea. Under the constraints of minority rule, it may be the best one lawmakers can get, and it would prove popular if enacted. We'll see if the Parksy Commission report is dumped in favor of that.

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