The Citizens Compensations Commission, a supposedly independent commission that sets legislative salaries, has decided that they will put a hold on a possible action of lowering legislative salaries until after the constitutional budget deadline:

Senate President Pro Tem Darrell Steinberg accused Gov. Arnold Schwarzenegger today of leveraging legislative pay to pressure lawmakers in budget talks to bridge a projected $18.6 billion deficit.

“I have no doubt that the administration’s imprint is all over that decision,” Steinberg said of a proposal being considered by the state’s independent salary-setting commission to cut legislative pay and benefits by up to 10 percent.

The commission, whose members are appointed by the governor, decided last week to postpone any decision on a legislative pay cut until June. (SacBee)

Of course, Arnold’s people try to play cute by citing the so-called independent nature of the commission. Which would be great, if it were true. Instead, it’s packed full of Arnold-ish centrists who want nothing more than to get along.

In the end, this is just pay to play politics at its worst. You best be good and do the centrists bidding, or you are going to lose some money.  How is this a good idea in any way?

Worst governor ever:

More Californians disapprove of the job performance of Gov. Arnold Schwarzenegger than any governor in modern state history including Gray Davis, who was ousted by Schwarzenegger in a popular uprising, according to a Field Poll released today.

Seventy-one percent of California voters surveyed said they disapprove of Schwarzenegger’s handling of the job, while 23 percent approve. The low ratings are shared across all demographics including party affiliation, region of the state, age and race or ethnicity.

The Field Poll shows Arnold has seen an 11 point swing against him since January, with his unfavorables rising from 64% to 71%.

As Calitics alum David Dayen noted, Californians figured this out all on their own, with no help from the media, who have continued to treat Arnold as a formidable power in state politics instead of explaining how his policies over the last seven years are largely responsible for the state’s current budget crisis.

Schwarzenegger ignored advice from folks like Warren Buffett that a tax increase was needed in 2003-04, and instead did nothing to address the state’s ongoing inability to raise enough money to fund its core services. When the bubble economy burst in 2007, the state immediately was thrown into recession. Arnold’s massively unpopular response was to embrace destructive cuts to services Californians need, and the only taxes he’s embraced have been the most regressive kind – sales taxes and fee increases for higher education students.

This appears to have been part of a very deliberate plan to turn the state over to the wealthy and the large corporations and implementing a shock doctrine attack on the poor and the middle class by seeking to privatize or eliminate the services they need.

Here’s an example. In February 2009, Arnold demanded and won a massive $9 billion cut to K-12 education. Federal stimulus funds helped blunt some of the impact of that cut, as 16,000 of the 30,000 laid off teachers were rehired. But as the stimulus funds are stupidly expiring this year, 20,000 more teachers are going to be fired. More and more schools are closing across the state.

What’s one result of these cuts? A much greater movement across the state for charter schools. That gives private companies the “in” they’ve long desired to our public education system. Through his budget cuts, Arnold has set the state for the mass privatization of public education in this state.

Finally, it is absolutely worth noting that Meg Whitman plans to continue almost all of Arnold Schwarzenegger’s policies, but will be even further to the right than he was. That might be something Jerry Brown would want to repeat early and often.

Today the pro Tem sent the following letter responding to the Governor’s demands to create new programs, to spend money we dont have, and to protect wealthy corporations who commit tax fraud from being held accountable.

March 16, 2010

Dear Governor Schwarzenegger,

I write in response to your March 15, 2010, letter expressing your opinion on the Legislature’s job creation

efforts and mid-year budget actions.

Over the last two months, the Legislature has considered and approved – in a bipartisan fashion –

legislation that would reduce the state budget deficit by more than $4 billion and create more than 40,000

jobs. Since you called the 8th Special Session to address the state’s fiscal emergency, the Legislature has:

• Held 10 full Senate Budget Committee hearings to consider, review, and take hundreds of hours of

public testimony on your January budget and jobs proposals.

• Developed and passed to you 12 budget-related bills that combine to reduce the state’s deficit by

$4.1 billion.

• Introduced and began passing a 27-bill jobs package aimed at creating 140,000 jobs in California.

Eight of these bills passed the Senate and four are on your desk, awaiting your signature. The work

continues.

• Held necessary oversight hearings to ensure bottled-up federal ARRA funds are moving through

clogged bureaucracies – like the California Energy Commission – in your Administration.

• Joined you on a bipartisan leadership trip to Washington, D.C. to ensure California receives its fair

share of federal funds to help us meet our current fiscal challenges.

As I stated during our phone conversation yesterday, I remain optimistic that we can work together to

achieve our common goals of balancing our budget and stimulating our economy through job creation.

While Republicans and Democrats in the Legislature have already taken bold and decisive steps toward

these objectives, we recognize that more can and needs to be done. We look forward to working with you

on this, and offer the following to guide our discussion.

Your letter mistakenly claims that the budget legislation sent to you last week addresses only

$200 million of the state’s $20 billion budget deficit. Actually, the mid-year actions taken by the

Legislature would have reduced the deficit by 20 percent, or more than $4 billion.

Unfortunately, you vetoed one measure that would have cut our deficit by $2.1 billion, and

appear intent to veto another measure valued at more than $1 billion. In short, it is your actions

that threaten to reduce the value of the Legislature’s budget solutions from more than $4 billion

to only $200 million.

With respect to the gas tax swap measure, you are correct that the version passed by the

Legislature differed from your original proposal. But that is hardly a reason to veto the measure

that is currently awaiting your signature. You claim your proposal would have provided $1

billion in lower gas costs for consumers. Unfortunately, this claim is not only unsupported by

any evidence, but is actually refuted by the conclusions of the state Attorney General and

experience in other states that have reduced fees on gasoline. The evidence actually establishes

that consumers end up paying as much or more for gas after implementing such marginal fee

decreases, and that the end result is increased profits for oil companies. As the Hartford Courant

reported when Connecticut tried a similar gas tax cut, “Gas taxes and prices are not connected in

an ironclad way. The tax can be cut, but the benefits to consumers will be swallowed up in

higher prices at the pump. In the future, the Governor and Legislature should build tax policy on

a firmer foundation.”

Further, your proposal would have resulted in a dramatic reduction in revenue for transit and

road improvements that Californians deserve, and that also help create and maintain more than

15,000 jobs. In other words, because the Legislature shares your commitment to job creation, we

sent you the version as modified. I hope you will reconsider your stated intent to veto the

measures on your desk.

Next, you take issue with the bill we sent you that provides tax relief for victims of short sales

and developers of renewable energy projects because the measure also includes a provision that

imposes penalties on the wealthiest individuals and corporations that commit tax fraud, with full

due process and appeals available to those fined. It is disappointing that you would consider

vetoing this legislation over a provision that has been part of federal tax law since 2007, when

President Bush signed it into law. Aside from conforming with federal tax law, the penalty

provision also ensures that the vital tax relief we provide to short sale victims and renewable

energy developers is paid for, reducing the effect on our budget deficit. We believe the tax

conformity measure we sent you is fiscally responsible. Of course, if you find a conforming

penalty for the wealthiest tax frauds unacceptable, we would seriously consider an alternative

revenue source more to your liking, and of equal value, to include in the measure.

Which brings me to your concern about the Legislature’s failure to immediately approve and

embrace your specific “job creation” proposals. While we share a common goal to create jobs

and stimulate California’s economy, I remain committed to doing so in a fiscally responsible

manner. Unfortunately, the cornerstones of your jobs agenda would add more than $200 million

to the state budget deficit. I would love to work with you on a way to provide tax breaks for

homebuyers and “clean tech” companies in a manner that doesn’t worsen the budget deficit and

further reduce state support for public education. As you so eloquently stated in your weekend

radio address about the state budget situation, “When you’re in a hole, the first rule is stop

digging.”

With regard to your $3,000 hiring tax credit, the Legislative Analyst said that it was poorly

designed, wouldn’t create new jobs, would provide a windfall to businesses that are planning to

expand on the natural, and creates new borrowing that would have to be repaid by businesses

with a tax increase. As I told you yesterday, I am happy to work with you on alternatives to this

proposal that would have a better shot at creating new work opportunities for the thousands of

unemployed Californians.

Governor, thank you for your letter and your commitment to restoring California’s economy in a

fiscally responsible manner. I look forward to working with you in the days and weeks ahead to

achieve our common goals.

Sincerely,

DARRELL STEINBERG

President pro Tempore of the Senate

Today’s Sacramento Bee has a good article on Arnold Schwarzenegger’s inconsistent tax rhetoric, and Kevin Yamamura does a good job showing how Arnold relies on semantics to justify supporting fees while threatening to veto several proposals to close tax loopholes, including for online sales and for corporate tax calculations.

But what the article really reveals is that Arnold Schwarzenegger has a very simple approach to taxes that the rhetoric merely obscures: any tax on corporations is bad, but taxes on everyone else are just fine. Arnold Schwarznegger is bent on making the working people of California pay to keep vital services operating in order to fund tax breaks for his corporate allies. From Yamamura’s article:

Gov. Arnold Schwarzenegger threatened last week to veto a bill that would reduce a corporate tax break, calling it a tax increase. He says requiring Amazon.com to collect tax dollars already owed is a new tax burden.

But he believes a new surcharge on property insurance is a “fee” that Californians ought to pay.

The Republican governor has pledged not to raise taxes in his final year in office, but whether that holds true depends on what your definition of a tax is. Legislative counsel already has drafted the insurance fee as a tax bill.

We can draw the distinction even more clearly. Arnold Schwarzenegger wants to give Amazon.com a big tax break, but is going to drive up the health care costs of hundreds of thousands of families by further gutting state health care programs. He wants to give oil companies a massive tax break by refusing to support an oil severance tax to fund higher education, but supports a 30% increase in the fees students have to pay for higher education. He supported a sales tax increase but opposes closing a reckless corporate tax loophole opened in the February 2009 budget deal that costs the state $2 billion a year.

Most Californians now understand that Arnold Schwarzenegger has been a catastrophic failure for the state, having left California in much worse shape than he found it in 2003.

Only now are Californians beginning to understand why that is the case. Arnold Schwarzenegger came to power with the primary mission of helping his corporate allies enrich themselves at our expense. Meg Whitman is poised to finish the job by destroying what remains of California’s shared prosperity by cutting and privatizing most public services, massively increasing the cost to most Californians but being able to claim she’s avoided new taxes in the process.

It’s further evidence of how anti-tax politics don’t actually work – they wind up costing most taxpayers more money in the end, by making them more individually responsible for paying for necessary services that were cheaper when the cost was pooled.