This is the tenth part of a series of posts analyzing California’s propositions:

• Vote Yes on Proposition 30 – Jerry Brown’s Budget Plan

• Vote No on Proposition 31 – Changes to State Budgeting

• Vote No on Proposition 32 – Union-busting

• VOTE NO ON PROPOSITION 33 – CAR INSURANCE

• Vote Yes on Proposition 34 – Death Penalty

• Vote No on Proposition 35 – Human Trafficking

• Vote No on Proposition 36: Three Strikes Law

• Vote No on Proposition 37: Genetically Engineered Food

• Vote No on Proposition 38: Molly Munger’s Tax Initiative

• Vote No on Proposition 39: Multistate Businesses Taxes

• Vote Yes on Proposition 40: State Senate Redistricting Referendum

More Ballot-Box Budgeting

Proposition 39 is a typical example of ballot-box budgeting. Tax X, spend on Y. In this case, X equals multistate businesses and Y equals clean energy.

More below.

The proposition raises taxes on multistate businesses in California through a subtle method. Right now those businesses can choose between two ways of calculating their taxes. They can be taxed based on the number of sales, property, or employees the business has in California (the “three-factor method”). Or they can be taxed based only on the number of sales (the “single sales factor method.”)

Proposition 39 changes it so that multistate businesses can only be taxed through the latter method. This would raise their taxes.

Of the money raised, $550 million is given to green energy for five years. In the post on Proposition 34, this blog argued:

This is the type of terrible policy which the proposition system is famous for. One hundred million in spending by Proposition 34, ten billion in spending by a proposition here, five billion in tax cuts by a proposition there – it’s no wonder California has trouble balancing its budget. Ballot-box budgeting like this is disgraceful.

The same logic holds here. This blog would be more inclined to support the proposition if the revenue raised was left for the legislature to direct as it willed. As it is, the proposition’s micromanagement of its funding is just another reason to vote against the proposition.

An Easy No

Fundamentally, California voters don’t have enough information to know whether or not this proposition is a good idea. Is it a good idea to make it so that multistate businesses pay taxes based on the “single sales factor method” rather than being able to choose between the “single sales factor method” and the “three-factor method”? Beats me.

The logic against Proposition 39 is similar to that against Proposition 31, and it’s worth repeating that logic here. If this policy change were proposed in the legislature lawmakers and their staff would probably have access to studies, surveys, and analyses on whether or not it would be better for the general welfare if multistate businesses paid taxes only based on the “single sales factor method” or if they paid taxes based on a choice between the “single sales factor method” and the “three-factor method”. Those studies and analyses would probably run up into the dozens of pages.

But voters just have two pages of all-caps arguments for or against this change (the legislative analysis makes no judgement on which policy is wiser). For such a major change, it’s not enough.

The legislature should be setting tax policy, not the proposition system.

–inoljt

If there’s one thing that’s been particularly consistent to campaigns of the far right in San Diego this fall, it’s the unusually desperate attempts to hide the real agenda from voters. It’s one that should be cause for optimism as long as voters pay attention, and betrays an almost impressive self-awareness from the top of the GOP that the party’s agenda has drifted well outside the mainstream.

From the special exemptions of Prop 32 to Brian Bilbray’s teetering re-election bid to Carl DeMaio’s bizarre mayoral campaign, extreme conservatives are doing everything they can to hide their record and who they are.

For the backers of Proposition 32, the deception was part of the design from the very beginning. They surveyed the political landscape and found that, unsurprisingly, nobody wants millionaires and corporations to be able to buy off our political process. Rather than abandon a wildly unpopular idea, they came up with a different plan: fake it.  

Cross-posted from San Diego Free Press

That’s Prop 32, from the same white knights of campaign finance reform who broke the system to begin with by using the Citizens United case to overthrow existing regulations on special interest money. This year, they simply took it a step further, called the plan reform and packed in enough special exemptions to create a system that only works for corporations and millionaires.

It makes sense because everyone wants campaign finance reform. But the reason they want campaign finance reform is specifically because of what Prop 32’s backers have done and continue to do.

The hundreds of millions of unregulated, unlimited political cash flowing into SuperPACs exists specifically because of Prop 32’s backers, and now its being funded by the Koch Brothers and other super-rich conservatives that saw Citizens United as the starting pistol to buy off democracy. Prop 32’s hoping to trick voters. Will they see through it?

At the same time, there’s Brian Bilbray. He has cobbled together a decades-long career of faking moderation when election time comes around, but the reality just doesn’t match the myth he’s built for himself when push comes to shove. Bilbray wants to cast himself as an environmentalist, but mustered just a 17% score on the League of Conservation Voters 2011 scorecard. And it was Bilbray’s early work trying to gut the Clean Water Act that once inspired Donna Frye to become a clean water activist.

He’s done his best to avoid the ramifications of the national GOP’s war on women, right on through to Todd Akin’s ‘legitimate rape’ comments. But the reality of his record remains, including a pitiful 8% score from Planned Parenthood’s scorecard. Brian Bilbray may not want to be lumped in with the war on women, but if that’s what he’s hoping for, maybe he shouldn’t have signed up for it in the first place.

All of that could maybe be overlooked if Bilbray had taken up the mantle of the millions of Americans devastated when the economy fell apart near the end of the Bush administration. But while Bilbray will certainly have populist talking points on the stump, it’s worth remembering that he voted for the Paul Ryan plan to dismantle Medicare and destroy Social Security in response to increased economic security.

And Bilbray’s plan for economic recovery? One part rewarding tax-evading corporate interests, one part Let them eat a Yacht Race! Not exactly your tired, your poor, your huddled masses.

For Carl DeMaio, the attempt to whitewash nearly twenty years as a professional politician has been even more depraved than elsewhere. After coming up with the likes of Newt Gingrich, Virginia Thomas, the Jack Abramoff crew, and the Koch Brothers, it seems to have dawned on Carl that the city of San Diego, well… really doesn’t like that at all.

During his tenure on the council, DeMaio has received the lowest cumulative score on the annual Environmental Quality Report Card. And despite being appointed since joining the council, DeMaio hasn’t appeared in the minutes of a single meeting of the San Dieguito River Valley Regional Open Space Joint Powers Authority since January 2011.

Reality didn’t matter to DeMaio though when he took a week out to declare himself an environmentalist. He didn’t get very far with that, so he moved on to a plan to encourage biking by investing in more roads. Doesn’t make sense? It isn’t supposed to. It’s just supposed to distract from his career-long record on the wrong side of these issues.

Word on the street is, DeMaio spent some time recently trying for an endorsement from the Victory Fund, which led to an unexpected declaration from Carl that he was pro-choice. It has to be considered unexpected since it was certainly news to Planned Parenthood. Why? Because despite the clear reasons that choice matters at the local level, DeMaio has always refused to fill out Planned Parenthood’s questionnaire. And today, if you’re looking for pro-choice candidates in November, you sure aren’t going to find Carl DeMaio on the list.

There are still more examples. He runs as a fiscal conservative while voting against hundreds of millions in taxpayer savings and getting the BS treatment from Mayor Jerry Sanders. He tried out medical marijuana but that fell flat once anyone read past Carl’s own statement.

He took a quick stab at being for the middle class and affordable housing over the summer, trying to pass off support from a landlord group as support for tenants. The claims were called “preposterous,” and the former CEO of the San Diego Housing Commission said in no uncertain terms that “Carl DeMaio is not an advocate for more affordable housing.”

Heck, DeMaio has even tried reaching out to the Latino community while trumpeting an endorsement from Pete Wilson, the father of Proposition 187. And after casting the only vote on the council in support of Arizona’s SB1070, his Latino outreach has featured a plan to have local police enforce federal immigration law.

The most amazing part is the special brand of doublethink that DeMaio has going on in all this. He isn’t just making up an entirely new self for the general election, he’s doing it while criticizing others for the same thing. Like last week at the KPBS mayoral debate:

“The U-T CEO mentioned that he got support from labor, and yet labor has not supported it, that he got support from business groups, but very few groups that are out there have supported the plan,” DeMaio said. “And so I just think that the email probably was making some claims that are not grounded in reality.”

Now, it wouldn’t be shocking to discover the UT making claims that are not grounded in reality. But compare that to DeMaio’s recent record. He’s an affordable housing advocate unless you ask affordable housing advocates. He’s an environmentalist unless you ask environmentalists. He’s a medical marijuana advocate unless you ask medical marijuana advocates. He’s pro-choice unless you ask Planned Parenthood. He’s a friend to the Latino community except for wanting them to be harassed by the police. He’s a fiscal conservative except for imposing a billion dollar tax increase without a vote of the public.

But when Doug Manchester and John Lynch — the very same duo who helped DeMaio defeat essentially the same tax increase in 2005 — don’t poll well, then maybe reality has come loose.

Does it work? Maybe not with anyone who has the time and interest to dig into the substance. But those who never catch more than headlines because they have lives full of working to make ends meet, struggling with health care bills, working into retirement thanks to Wall Street, trying to figure out what to do after a foreclosure… they understandably won’t ever have that time.

And that’s the whole idea. Keep up the game of whack-a-mole long enough that voters never get a chance to examine the truth.

It’s said that great writers steal outright, so here’s a heartfelt tip of the cap to the inimitable Ann Richards before saying: Poor Carl.

He’s never once had a job that asked him to appeal to a majority, or even anyone resembling moderates. So now that he’s stuck in a general election, he’s like Columbus discovering America. He’s found the environment. He’s found the middle class and working people. He’s found women. He’s found the sick and suffering. He’s found Latinos.

Poor Carl. He can’t help it. San Diego just doesn’t want what he’s been selling his whole life.

I’m proud to work for San Diegans for Bob Filner for Mayor 2012

Consumer Watchdog has been growling for a while about global corporations that use a tax loophole to pay less in California corporate taxes than in-state companies. Four major companies–Kimberly Clark (Kleenex, Scott toilet paper), General Motors, Chrysler and International Paper–have even launched a major lobbying campaign in the state to save their selfish loophole. They are happy, obviously, cheating the state of a billion or more dollars a year that could keep teachers in jobs, the disabled out of nursing homes and parks open.

Now there’s a ballot initiative, Prop 39, that’s aimed at closing the tax loophole, and one of its first public blasts is this funny video, “The Tax Dodger Olympic Dash”–track and field for billionaires.

Along with the video is a text tidbit, revealing that the same companies fighting to keep their loophole in California fought just as hard to keep such tax loopholes out of their home states. There’s nothing like a heaping helping of corporate hypocrisy to start the day!

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Posted by Judy Dugan, research director for Consumer Watchdog, a nonpartisan, nonprofit organization dedicated to providing an effective voice for taxpayers and consumers in an era when special interests dominate public discourse, government and politics. Visit us on Facebook and Twitter.

Anti-tax groups get ready for big push in November

by Brian Leubitz

While President Obama won’t be spending a lot of time here in October, you can bet there will be a lot of money spent here.  With the Special Exemptions Act, the death penalty, several contested Congressional seats and the Governor’s revenue measure on the ballot, it will be a busy campaign season. But for Howard Jarvis’ corpse, it will be the same ol’ same ol. It’s what they do every day, slam the goverment, tell them how  terrible it is and bam, there you go.

There, at a news conference to announce the formation of “Californians for Reforms and Jobs, not Taxes,” Jon Coupal, president of the Howard Jarvis Taxpayers Association, previewed the campaign against the governor’s November ballot initiative to raise taxes. It will rely on messages, he said, that “quite frankly, are short and sweet.”

Brown’s opponents, Coupal said, will remind Californians of the state’s relatively high tax burden, challenge the Democratic governor’s claim that his tax increase is for schools and publicize unflattering examples of government spending.(SacBee)

Of course, take any large organization and you can find some dumb stuff going on. And, the California government is such and organization. But, just because there is a small stupid thing going on, doesn’t mean that we should just toss the big, smart things that go on every day. Like, you know, educating our children, maintaining our streets, and so on. California government is simply too big to fail.

Yet, that is where we are headed. With the continued pessimism and me-first attitudes of the anti-tax organizations, we are stuck on a 20th century budget in a 21st century reality. We have neither the flexibility nor the wherewithal to continue with budget disaster after budget disaster. And, yeah, the current budget is a mess.

The governor’s measure doesn’t fix that, and doesn’t totally save the budget, but it is a step that we must take.

For the last several years, students have been paying higher and higher tuition in order to attend the CSU. The most recent tuition hike, in November of 2011, was 9% (while the one planned for this fall is 11%), and student protesters were met with the now-standard response of unaccountable authority figures: they were pepper-sprayed, and in some cases, forcibly subdued (http://www.youtube.com/watch?v=vrBFAAf8m88). The CSU is facing the possibility of massive cuts to its budget next year (in the area of 250 million dollars), and student enrollments are going to be frozen for the 2012-2013 academic year (and shut off entirely in Spring 2013). Faculty, whose contract was simply disregarded by Chancellor Charles Reed (who argued that given the budget crisis he could not honor the negotiated pay raises of 2.5% for the years 2008-2009 and 2009-2010), have not had a raise in pay since 2007.

But this spring, the trustees of the CSU met in Long Beach to consider the matter of pay raises for executives-specifically for two University presidents who were switching into new jobs (http://californiawatch.org/dailyreport/new-csu-presidents-slated-get-maximum-pay-increases-15361). Each raise in pay (in the neighborhood of $30,000 per year) was approved, along with housing benefits (an extra $60,000 per year in one case, and a University-provided mansion in the other) and car-expense allowances (amounting to $12,000 per year in each case).  

Something is rotten in the state of the CSU. But where might that rottenness come from?

On March 23, 2012, The Washington Post published an editorial by David C. Levy, the former Chancellor of the New School (a college within NYU), that made the following claim about the costs of higher education and the need for reform: “Overlooked in the debate are reforms for outmoded employment policies that overcompensate faculty…” (http://www.washingtonpost.com/opinions/do-college-professors-work-hard-enough/2012/02/15/gIQAn058VS_story.html).

This, no doubt, will be echoed in California by CSU Chancellor Reed and his $300,000 to $450,000 per year fellows with their additional  housing allowances ($60,000) and car allowances ($12,000) that exceed many (even most) CSU faculty salaries. According to men like Levy and Reed, the problem with higher education, the real driver of rising costs, is that faculty get paid too much. It isn’t the fact that even State universities like the CSU are paying their executives between $300,000 and 450,000 per year (along with an ever-burgeoning layer of vice-presidents, provosts, directors, deans, assistant deans, assistant directors, special project managers, etc., who make anywhere from $150,000 to nearly $300,000 themselves). No, it’s the $35,000 per year full-time adjunct Professor, and the $60,000 per year Assistant Professor, all the way through those Full Professors who are making $85,000-$90,000!

According to Levy, “faculty salaries make up the largest single cost in virtually all college and university budgets.” This, of course, is Management-Consultancy 101. It is the Bain Capital way of thinking about assets and costs–problematic enough in the world of profits and losses, but absolutely to be resisted in the world of public education–unless, of course, we want our public universities to become profit-driven enterprises like the University of Phoenix, with template-driven courses, low-paid instructors, and massive “economies of scale.”

The point is simple: cost reductions will help keep executive pay high, and they certainly aren’t going to campaign to lower their own salaries are they? Tuition will rise, as it has for the last several years in a row, but only so far. The logical target, the target which has been planned for ever since the for-profit, factory education movement began, is the faculty. If the faculty can be outsourced, turned into something like script-readers in a call center (and make no mistake, that is the goal of many of the people who run for-profit education institutions, as well as those in the non-profit world who envy their methods and “cost” savings), then the last vestige of inconvenient resistance will have been eliminated. This will take some time to achieve, and the raising of administrative salaries that we see now in the CSU, along with the raising of tuition, and the concomitant refusal to honor signed contracts with faculty–well, all of that is just the beginning, just the opening move. But now that the move has been made, it will not be unmade without a struggle.  

This spring’s activities by the CSU Chancellor’s office in Long Beach have made clear who its leaders value. It isn’t the students. It isn’t the faculty. And it most certainly isn’t the taxpayer–for while CSU executives impose ever-higher tuition rates on students, and simply refuse to honor signed contracts with faculty, they are giving themselves raises, houses, and cars. Oh, and throwing themselves expensive parties, too (http://losangeles.cbslocal.com/video/7179307-investigation-reveals-questionable-spending-by-csu-chancellors-office/)

It must be nice.

Increased budget deficit means big cuts with or without tax initiatives

by Brian Leubitz

With the recent announcement of a bigger than expected deficit, Gov. Brown has announced bigger than expected cuts are coming in his May revision of the budget.

The gap grew, the budget revision states, because Brown over-estimated tax revenues by $4.3 billion and the federal government and courts blocked $1.7 billion in cuts the state wanted to make. The remainder of the difference reflects an increase in the amount of money the state is mandated to spend on education under a complex voter-approved formula.

To close the wider gap, Brown has heightened the cuts he wants to make to Medi-Cal, to $1.2 billion, and maintained another $1.2 billion in welfare and child-care savings he proposed in January.

He also wants to slash payments to people who care for the disabled by 7% and reduce the state payroll through a shorter workweek or wage concessions. He proposed $500 million in cuts to the state’s struggling court system, including a one-year freeze on all new construction projects.(LA Times)

That’s just the best case scenario there. As horrendous as that may be, if the tax measure in November doesn’t pass, Brown is set to do a triggered cut of $5.5 billion and $3b other cuts.  

At this point, the waste is gone. We are cutting vital services that won’t just magically reappear when times get better. We are fundamentally changing how we treat each other, and we are letting social darwinism run amok. It’s a tragedy of immense proportions, and no saviors are riding in from the horizon.

Combined measure raises hope for a progressive victory

by Brian Leubitz

Governor Brown for a long time has known, and publicly stated, that he wanted to eliminate the other competing revenue measures.  When he wasn’t able to do it by sheer publicity, apparently he found it necessary to strike a deal:

After weeks of battling in public and negotiating behind the scenes, Gov. Jerry Brown and the California Federation of Teachers have reached a tentative compromise on a November tax initiative, sources close to the deal said.

As currently structured, the deal would result in a smaller sales tax hike and larger tax increase on the wealthy than the Democratic governor wanted. CFT had been circulating an initiative with no sales tax hike and a two-step increase on earners starting at $1 million.(SacBee)

Now, Molly Munger still has her revenue measure that would raise taxes on pretty much everybody. And considering she just dropped another $300K into the account, it doesn’t seem like she has any interest in backing away now.  It certainly doesn’t seem like she’s posturing, but considering where her measure is polling, it is a long shot at best.

CFT and the Courage Campaign worked quite hard on this more progressive Millionaire’s tax, and they both deserve a lot of credit for pushing the Governor on this.

Governor releases poll showing measures would fail if all three on ballot

by Brian Leubitz

Of course, the question then becomes which measure you actually put on the ballot. Brown’s poll has some interesting figures on that:

Both Brown’s temporary tax hike — a half-cent rise in the sales tax coupled with increased levies on higher earners — and a proposed tax increase on millionaires sponsored by some unions score more than 50% on the poll. Brown’s measure is at 53% while the millionaire’s tax polls at 55%, according to a statement from Sacramento-based pollster Jim Moore.

The third proposed tax hike, an across-the-board income tax hike to fund public education pushed by civil rights attorney Molly Munger, lags with only 31% support.

But if all three appear on the ballot, the release states, none cross the 50% threshold. Brown’s wins 43% support, the millionaire’s tax 42% and the income tax 17%. (LA Times)

Munger seems not to be interested in backing off, despite what poll after poll shows: her measure really can’t pass. And, really, it should be no surprise. It increases tax increase for everybody making any amount over about $7750.  That really isn’t going to fly with any electorate really.

Now, as to the question between Brown’s measure and the millionaire’s tax, the issues become closer.  Both sides seem intent on their own measures making it on the ballot.  While Brown’s has considerably more resources to get on the ballot, there is still a strong chance of both making it.  Unless somebody backs off, we stand a chance of seeing all three measures on the ballot.

For reasons of confusion and principle, having three on the ballot makes it even tougher to get one through to 50%.  And at this point, I’m not sure the little discussion through the media is really working.

As Conservatives play games with the former President’s legacy, what would Ronald Reagan do in today’s California?

I probably wouldn’t have known it was “Reagan Day” but for the helpful tweets of @GeorgeRunner. The former legislator and current member of the Board of Equalization isn’t really much of a tweeter, but on occasion he gives us such helpful words as “Happy Reagan Day!” after a few weeks of silence other than an announcement of his “e-newsletter.” (By the way, if you call it an “e-newsletter,” you are doing it wrong.)

Anyway, I thought I would take a moment to remind Mr. Runner and his #tcot friends about a few facts of the Gipper’s tenure here in California. In a blog post, Bruce Bartlett, a Reagan domestic policy adviser, points out some of the false tax mythology:

Reagan’s record on raising taxes began almost the moment he entered politics. Elected governor of California in 1966, he inherited a large budget deficit from his predecessor, Pat Brown. Although a conservative, dedicated to shrinking government, Reagan nevertheless found the magnitude of spending cuts that would have been necessary in 1967 to be beyond reach. This led him to endorse a $1 billion per year tax increase, equivalent to a $17 billion tax increase today – an enormous sum equal to a third of state revenues at that time. Journalist Lou Cannon recounts the circumstances:

“No amount of budget reductions, even if they had been politically palatable, could have balanced California’s budget in 1967. The cornerstone of Governor Reagan’s economic program was not the ballyhooed budget reductions but a sweeping tax package four times larger than the previous record California tax increase obtained by Governor Brown in 1959. Reagan’s proposal had the distinction of being the largest tax hike ever proposed by any governor in the history of the United States.”1] ([CG&G Feb 2011)

Let’s stop with all the beatification and think about what really happened 45 years ago, and what is happening now.  Like Reagan, Gov. Brown inherited a big deficit from his predecessor. Schwarzenegger’s mish-mash of policies left the state without direction and with a huge deficit to show for it. Brown the Younger in his third time has a similarly daunting challenge as he did in 1978 after Prop 13 and as Reagan did in 1978. And like Reagan, he understands the impracticality of a cuts-only budget solution.  And the tax increases that Brown is proposing today is less than half of the Reagan 1967 tax increases.

Runner and his fellow Republicans need to really take a deep look about their presidential saint and how he was able to objectively look at a situation and be more than ideologically dogmatic.  Perhaps then we could really govern the state, and the GOP could return to relevance.

If you’d like to see more debunking of the religion rapidly building around Reagan, read the entire post. Think Progress also has a great post about Reagan’s real legacy last year for his centennial.  Let’s