Arnold Schwarzenegger’s right-wing Director of Finance, Mike Genest, is resigning from his post, after being the governor’s point man on the budget since 2005. And after being the governor’s point man on gutting the state these last few years, he is leaving with a few parting shots. Not at the current governor, but at one of the hopefuls looking to replace him: Steve Poizner. As Genest tells it to George Skelton, Poizner’s 10-10-10 tax cut plan is a political non-starter as well as economically and financially ruinous:
“Tax cuts do tend to improve the economy,” Genest says, “but it’s very hard historically to find where they result in a revenue increase. You could argue that the best thing for the economy is to have no taxes at all, but people depend on some government services. Without them, we don’t have any economy. If you don’t believe me, look at Somalia.”
Genest continues: “There’s no basis to believe that a tax cut now would be affordable given the budget situation the state faces. I know Rush Limbaugh is going to hate me.”
As for deeper spending cuts, Genest says: “You can always cut spending by 10%. The question is do you want to. We just tried to close parks, and that didn’t work out. We tried to take money away from women’s shelters and had to relent on that.”
I like Genest’s honesty here – he says they wanted to close parks and cause further harm to battered women, but that public outcry prevented this. One wonders if Democratic leaders will get the message: Arnold can be forced to back down if the Dems refuse to go along with his hurtful cuts by mobilizing public outrage. Skelton, for once, helpfully connected the dots and showed that the attack on government itself actually hurts instead of helps businesses and jobs:
There’s also a dispute about whether businesses and wealthy Californians really are fleeing the state to escape high taxation. Many think any fleeing has more to do with high property costs, traffic congestion and subpar public schools.
“If high income taxes were chasing away rich Californians, high-income households would be more likely than low-income households to move to states without income taxes, but they aren’t,” the Public Policy Institute of California reported in July. And two years ago, the institute found that “when California businesses relocate, most stay within — rather than moving out of — the state.”
This gets to a fundamental truth that most Californians understand, but that Poizner is determined to ignore: without strong public services, California is an undesirable place to live, work, create, and innovate. The best way to chase away businesses and jobs is to destroy our schools, wipe out our health care system, and let our transportation system become paralyzed through gridlock and dependence on oil.
In fact, a coalition of business groups have come together to fight for one of the big government spending programs designed to help California’s crisis – high speed rail. I fully expect Poizner to oppose the high speed rail project, so I would like to see him explain that opposition to the corporations that comprise the SF Chamber of Commerce, the Bay Area Council, and the Silicon Valley Leadership Group, who together founded the new HSR coalition.
Skelton also quoted from Lou Cannon, noted biographer of Ronald Reagan, who pointed out that the Republican hero himself supported several tax increases in California, including the largest ever (as a proportion of the budget) to close a budget gap in 1967. At least while he was governor, Reagan understood the role of government in providing for the California Dream.
It’s a role Poizner refuses to understand, even when a fellow right-winger like Mike Genest tries to explain it to him. Although I’m sure it will play well with the teabagger base.