Thursday, February 3, 2011

California Alternative Budget--Make the Rich PAY!

Huck/Konopacki Labor Cartoons
Duane Campbell, from the Sacramento Progressive Alliance, and the Choosing Democracy blog, sent California Gov. Jerry Brown an alternative budget proposal, in response to the request for budget suggestions he made in his State of the State speech. He notes that California now ranks 47th among all states in per-pupil spending, ($2,856 less per pupil than the national average) and correctly argues that we need to increase educational spending, not cut it or even keep it steady.

His Specific Proposals:

(1) Enforce the current California law taxing the sales of goods by out of state companies ( such as Amazon) over the internet. Gain: $1.2 billion. There is already legislation to do this.

(2) Pass the $10.1 billion jobs package as proposed in the Assembly last year. This would pay off debts to local governments and keep teachers in classrooms to avoid massive layoffs. Pay for the Jobs package with a new oil severance tax. California is the only oil producing state in the country that imposes no taxes on the pumping of oil. The proposed tax was to be 6% of the sales price of oil. Alaska and Louisiana both charge 12.5%.

(3) Establish a public state bank such as the Bank of North Dakota. Initially move 25% of all state revenue, receipts and reserves into this bank and 25% of all PERS and STRS funds. Manage the bank as a public service. Over time, finance state borrowing from our own bank. Gain: 6% of the budget.

(4) Continue efforts to eliminate waste, fraud and abuse where it exists. There may be legitimate savings here. Employees, particularly managers should not be able to inflate pay in the year or two before retirement in order to receive an outsized pension benefit. While these cases are not the major source of financial stress of pension systems, abuses are frequently publicized and undermine confidence in the administration and fairness of public employee pensions.

(5) Repeal the 2009 and 2008 tax cuts for corporations passed to gain the extra Republican votes for the budget. Savings: $1 billion.

(6) As a consequence of the just passed federal tax reductions, including the reduction of taxes to the wealthiest taxpayers, Washington-based Citizens for Tax Justice estimates that California’s richest taxpayers will be saving about $14 billion annually on their federal taxes. The next wealthiest 4 percent, with an average income of $310,000, will save another $6.5 billion. State taxes should be increased on these two groups to secure this available 20.6 Billion dollars to fund the necessary jobs creation projects.

(7) Sell state bonds to gain funds for investment. At present, we pay bond holders a market rate. Rates are so low at present we should borrow and invest. To achieve a stimulus, we could sell many more bonds in particular to the public employees retirement system PERS and STRS.

(8) The legislature could also place on the ballot a “split roll” property tax initiative to deal with the present inequities of taxation. In virtually every county, commercial property is paying a far smaller share of the property tax since Proposition 13 passed in 1978.

Commercial property is able to exploit huge loopholes in the law to avoid reassessment upon change in ownership.

Here Are A Few More of My Own Suggestions:
(1) Tax marijuana
(2) Abolish the death penalty (it costs far more to hold prisoners on death row than to hold them for life without possibility of parole)
(3) Release all nonviolent drug offenders and get them into rehab
(4) Increase gasoline taxes (and use revenues to increase mass transit and alternative energy investments)
(5) Most Importantly: Tax the hell out of the rich and the corporations. Make them pay more than everyone else, much more. They can afford it. They’ll still be rich. It won’t change the status quo, but it will prevent the rest of us from losing any more ground

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