In my conversations with Republican Leaders in the State Legislature, there has always been one caveat to the line in the sand drawn against raising taxes, at least temporarily. They have consistently told me that they would at least entertain the thought if Democrats would put on the table placing a real spending limit measure on the ballot that, if passed, would place a modest and real hard limit on the annual allowable growth rate of state government.
In other words, Republicans have little interest in punishing taxpayers for overspending, and at the very minimum, the system that allows the overspending needs to be fixed.
Today there is an article in the Los Angeles Times that talks about a potential deal in the works (though the reporter notes that the deal may be falling apart as the specifics leak out) involving a substantial hike in the state car tax in return for placing a spending cap measure on the ballot.
We caution our Republican leaders not to be lured into any situation where the GOP puts up votes to increase taxes in return for a “potential” spending limit. Since a spending limit measure would require voter approval, one could imagine a scenario where Republican votes go up to increase fees or taxes, and then the public employee unions spend some of their millions to decimate the spending limit measure on the ballot.
I am not sure how the finer details could be worked out – the simplest solution, if constitutional, would be to put the whole “solution” in front of voters as one package. Otherwise, I would leave it to Republican Leaders and their policy pros to figure out how to tie any tax or fees increases, temporary or permanent, to the passage of a hard spending cap.
California voters already were sold a bill of goods about borrowing money to pay for years of overspending. The result? Continued overspending that has resulted in the situation in which we find ourselves today.
Thank goodness for the sanity of our GOP legislators. Without them, clearly spending would continue to skyrocket, and tax rates would go through the roof – with no end in sight for either.
I will close on this point. Raising fees or taxes is a dumb idea, and it is a tragedy that instead of just doing the right thing — reducing the role that state government plays in California and tightening the proverbial belt, Democrats want to sock it to taxpayers. Well, if Democrats sign off on a spending cap and force GOP legislators to "increase revenues" to do it — it will work out poorly for their plans in the end. You see, what liberals refuse to acknowledge, is the Laffer Curve, which is an economic principle that says that when you raise tax rates, you actually reduce tax income. No, the only long-term solution to this mess is to cap spending (after the essential short-term cuts) and then allow the California economy to recover and grow, providing additional tax and fee revenues to the state.
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