Three business executives (Floyd Kvamme, David Marquardt, and Mark Stevens) recently sent out a fundraising appeal to their millionaire friends and colleagues seeking their support in opposing California’s Proposition 30, according to the California Progress Report. The initiative on November’s ballot, is supposed to bring in an extra $9 billion a year from increase taxes.
These millionaires and their wealthy allies are upset that the legislation would increase their income taxes by 1-3%. They are also careless: the letter somehow managed to fall into the hands of the California Nurses Association and California Federation of Teachers, which organized a protest in front of the elite St. Francis Yacht Club in San Francisco on August 21, one day ahead of the America’s Cup race. (You can view photos here).
It is telling that many of the state’s wealthiest individuals are opposing Prop 30, considering that the overwhelming bulk of their wealth comes from capital gains, which will be unaffected if the law passes. Indeed, the so-called Millionaire’s Tax (or Jerry Brown’s tax initiative), is really a tax on everyone but the millionaires. It includes a regressive sales tax increase, which affects lower income people far more than affluent individuals. It also includes an income tax increase which affects working and middle class individuals far more than the wealthy, since the wealthy get only a small fraction of their income from salaries. Even with the 1-3% income tax increase, the state's wealthiest residents' income tax rates will still be at historically low levels.
What their opposition tells us is that they would rather see public health, safety and education collapse than part with any of their income (or they expect everyone but themselves to bail out the state).