State Controller Betty Yee’s just released July Cash Report shows state personal income tax revenue falling behind estimates by 6.9 percent, or $323 million lower than projections. While some will argue that one month does not make a trend, these figures are significant because they represent revenue in the first month of the new state budget, a budget that is based on much higher income estimates.

Should these below projection income tax revenues really be a surprise to anyone with even a minimal understanding of basic economics? Economists tell us that if you want less of something, tax it more, and California has the highest marginal income tax rates in all 50 states.

When upper income individuals were slammed with tax rates on steroids as a result of Proposition 30, approved by voters in 2012, they had little immediate choice but to pay, and the tax revenue poured in. (It should be noted that the tax, approved in November, was retroactive for the entirety of 2012 so there was an almost instantaneous infusion of cash into state coffers.) Still, many compelled to pay these higher taxes took some comfort in knowing the exorbitant tax rates were… Read More

A further sign of the deteriorating political picture in California is the announced decision of Ray Ellis to quit the San Diego city council race. Well funded and in the November runoff in what used to be a Republican district, Ellis has read the tea leaves and dropped out — though I presume his name will remain on the November ballot. I got an email announcement today to that effect — because I was one of his donors in the primary.

It’s a sad but understandable decision. The Democrat will win easily, based on the surprising primary results. And the GOP turnout in November will be adversely impacted by the Trump divisiveness within the Republican Party.

This La Jolla district was the key race to winning a GOP majority on the city council, in a city that overall hasa decisive Democrat voter registration advantageof 42% to 25% (contrary to popular perceptions). Not gonna happen.

Here’s his letter to his donors:

Richard,

I want to thank you for all of your efforts and generous financial… Read More

The Governing website cited below is a great source for stats not usually available. Moreover, the format gives website visitors the ability to custom sort the stats to rank states (click on the column headings) — where illuminating facts can be gleaned.

For instance, recently in a comment section some clueless liberal bragged to me that the Democrat urban Democrat states are where people are moving to, abandoning the more free market, “right to work” Republican leaning states. A quick check at this Governing website disproved this gonzo assertion — big-time.

The migration pattern is not universally consistent either way. For instance, bad weather states tend to lose folks (or grow very slowly) regardless of politics. But that being said, it’s clear that on balance, people are migrating towards (relative) freedom.

For instance, let’s compare the recent migration patterns of my two perennial favorites — California and Texas. Governing uses the TOTAL migration figure — migration between states plus international migration. The figure is the net migration per 1,000 population — a fair way to compare… Read More

About6.2 millionstudents attend California’s K-12 public schools. Of those, over 570,000 are enrolled in public charter schools. Most of these charter schools operate with a degree of management autonomy and teacher accountability that goes well beyond what is permitted by the union work rules that govern traditional public schools. These charter schools themselves are accountable – if they don’t deliver better academic outcomes cost-effectively, they are closed down. They are a laboratory for excellence in education and administration, and they’re working. And their success is a tremendous threat to teachers unions.

Enter the ACLU. In astudyreleased earlier this week, the ACLU said it hadidentified 253 schoolswith “exclusionary policies,” and noted “this is just the tip of the iceberg.” The exclusionary policies were (1) exclusion based on academic performance, (2) discrimination against English… Read More

Monday, Donald Trump gave a pretty good speech on taxes. Putting aside the protectionist rhetoric on trade and the obvious negative impact it would have on U.S. exports, the tax portion of his speech was pretty good.

Unfortunately, it won’t get the attention it deserves because it follows a week of self-inflected distractions, the most serious of which being the assertion the election is “rigged.”

The election is not rigged.

For a decade I have traveled the country and the world teaching conservative candidates, political party leaders, and activists the skills necessary to wage strong political campaigns. In addition, I’ve served as an international election observer in countries such as Honduras and Kenya. While America’s political system isn’t perfect, it is among the best in the world, and it certainly isn’t “rigged.”

This is a dangerous assertion for the nominee of a major political party to make, for many reasons. Here are just a few.

It discourages people from engaging in the process – why volunteer, donate, or even vote if the outcome has been predetermined by some all powerful conspiracy? The… Read More

Below is an article and TV news segment revealing widespread nepotism in the huge water department of city of San Diego. I’ve got a sound bite in the video.

But this rigged hiring process is not an isolated instance. Not hardly!

In California, local government nepotism is widespread. It’s most predominant in the few highly-prized firefighter openings. LA and Oakland recently had huge nepotism scandals revealed.

It should not take a fraud hotline call to find these rigged hiring practices. Just routinely and VIGOROUSLY audit all departments’ employment processes. Better yet, contract out more government functions via open, COMPETITIVE bidding.

Most CA state and local government employment provides considerably higher compensation than equivalent private sector jobs. It’s become our state’s version of an aristocracy — complete with hereditary positions.… Read More

“It is enough that the people know there was an election. The people who cast the votes decide nothing. The people who count the votes decide everything.” – Joseph Stalin

Despite damning evidence of bias, and the disgraceful behavior of a state official who sits in judgment of others, theState Senateconfirmed Genevieve Shiroma’s reappointment to the state Agricultural Labor Relations Board 26-11, once again proving the Democrat Party is no longer Democratic.

In California, the Democrat Party now adheres to Joseph Stalin’s rule book. In April Shiroma, one of thethree-memberCalifornia Agricultural Labor Relations Board,… Read More

California’s State Controller, Betty Yee, normally displays a measured, albeit liberal, view of California fiscal affairs. While viewed as reasonably competent and not given to hyperbole, her recent statement in a local government blog was one she must have known to be flat wrong.

The blog, called County Voice, is disseminated by the California State Association of Counties. In it, Controller Yee pushed her vision of California tax reform – something about which she has written frequently. Yee, like most policy leaders both liberal and conservative, has recognized that California’s tax structure is broken. In fact, Yee is correct when she writes “our system leaves the state budget prey to boom-and-bust cycles, in turn disrupting funding of essential public services.”

While the real cause of California’s fiscal distress is that political leadership lacks the will to save money during the boom times, most agree that revenue volatility is a real problem that needs to be addressed.

However, after her observations about California’s volatile and highly progressive tax structure, Yee said this about property taxes: “Meanwhile, in the nearly four… Read More