When it comes to this year’s California state budget, there’s really only one question that matters: what’s going to be the price for a tax increase?

Let’s pretend that we can fast-forward past the next few weeks — or several months — of budget foreplay. Let’s assume that the Democratic scheme to pass a tax increase by majority vote doesn’t work, which means that some Republican legislative support will be necessary. Let’s look into the future toward that day when the California state legislature passes a budget by a two-thirds margin for Governor Schwarzenegger to sign.

Assembly Republican Leader Mike Villines has hinted that a package of tax and regulatory incentives that could improve the state’s business climate could be part of a tradeoff for some revenue increases. Because he was careful not to promise such an exchange, Villines was roasted by the state’s mainstream media for intransigence. But while he was not willing to negotiate against himself by offering up absolute assurances of Republican support before any serious discussions had occurred, he was effectively sending a message to… Read More

TheAssociated Pressis reporting that Californian Leon Panetta has been tapped by President-elect Obama to serve as the new CIA Director. This is the “change we can believe in”? The Obama Administration is starting to look like a game of Clintonian musical chairs—all the same players just different roles. I’m not too familiar with Leon Panetta’s intelligence experience, but a quick Google search doesn’t reveal much expertise in this field. With the situation in Israel unraveling, growing tension in the India/Pakistan region, an increasingly hostile Russia, and countless other international problems, the CIA position will continue to be a crucial department in dealing with terrorism. Let’s hope the Obama Administration has vetted Panetta’s qualifications better than some of his Cabinet selections.

h/t to the Sac… Read More

[My thanks to Jon for the invitation to blog at the Flashreport. The best thing about the blog format is the chance to have back-and-forth exchanges, so comments on my posts — and emails to me — are encouraged!]

The scare tactics being used to stampede everyone into higher taxes are amazing. By estimating expenditures without reductions and by extrapolating current revenues and then multiplying that by several years, it is possible to declare a budget deficit that is bigger than the budget. The scaremongers are not quite there yet, but they are close. Let’s define the problem.

Revenues were $101 billion dollars a year ago. Despite declines in the economy, state leaders stuck to this number even up to the September enactment of the 2008-09 budget. Now these same people are all shocked and amazed to announce that the revenue for this year will only be $91 billion. Governments are not very good to adjusting income downward (actually, no one likes doing this), but by my math that is roughly a 10% drop in revenues from the prior year. Since there are lots of ways to squeeze 10% out of government spending the simple solution would be to… Read More

Today we are leading off our main page with some exclusive content from Republican legislative leaders Senator Dave Cogdill and Assemblyman Mike Villines, as well as with a hard-hitting piece from Jon Coupal with the Howard Jarvis Taxpayers Association. Tomorrow, we’ll be bringing you some great commentary from some of our own team of correspondents including Dan Schnur, Ray Haynes, and yours truly.

I am pleased to officially welcome as contributors to the FR weblog Board of Equalization Member Bill Leonard and freshman GOP Assemblyman Nathan Fletcher. Look for some great commentary from these two, along with the rest of our stable of trusty center-right to right-right bloggers. We’ll be unveiling some additional new members of the blog team soon!

I’m actually headed off to the airport to make the trek up to Sacramento for a few days, renewing and establishing those contacts that allow us to bring you a lot of great breaking stories and original content on the page.

**There is… Read More

Today we are leading off our main page with some exclusive content from Republican legislative leaders Senator Dave Cogdill and Assemblyman Mike Villines, as well as with a hard-hitting piece from Jon Coupal with the Howard Jarvis Taxpayers Association. Tomorrow, we’ll be bringing you some great commentary from some of our own team of correspondents including Dan Schnur, Ray Haynes, and yours truly.

I am pleased to officially welcome as contributors to the FR weblog Board of Equalization Member Bill Leonard and freshman GOP Assemblyman Nathan Fletcher. Look for some great commentary from these two, along with the rest of our stable of trusty center-right to right-right bloggers. We’ll be unveiling some additional new members of the blog team soon!

I’m actually headed off to the airport to make the trek up to Sacramento for a few days, renewing and establishing those contacts that allow us to bring you a lot of great breaking stories and original content on the page.

Before I sign off, though, I did want to take a moment to… Read More

In our time-honored tradition, when I fly up to Sacramento, I like to share with readers some of the politicos on my flight (there's always someone)…

Today's featured co-passengers include State Senators Mimi Walters and Lou Correa, and Assemblywoman Diane Harkey. Also flying up is Arnold's Appointments Secretary John Cruz, and longtime FR friend Gina Zari, who is Senator Walters' Chief of Staff.

That's all for now… Wheels up!… Read More

The state is running out of money. They may stop paying legislators as soon as February. After that who know who gets paid and who doesnt. Eventually lowly legislative staffers wont get a paycheck. That includes me unlessthe state gets a budget deal.

Currently, the plan seems to be to cut a little (not enough) of the $40 billion in new spending that has appeared in the last four years AND find new fees and increasing fees on various. Now these fees look like taxes. Tax hikes require a two-thirds vote. So far there isnt a two-thirds vote for tax increase. So now they are fees and the Governor can get then with 41 votes.

There will be a legal challenge, but in the meantime they think they have a solution. And with Ron George Supreme Courts approach to jurisprudence who knows what will happen.

But here is their problem. Fees can have a referendum placed on the ballot to stop them. Taxes cant. A two-thirds deal avoids all this, a 41 vote deal doesnt

It is easy to file for a referendum. Ive done it. Once a bill become law, you send a check for $200 dollars to the Attorney General with a letter and presto magic you have ninety days to get the 433,971… Read More

Today’s top headlines – tomorrow look for the return of FR’s main page! Two editorials on the State Budget situation worth reading OCReg: New Year, same wrong budget path SDUT: Get out the ax – ASAP Columns of Interest SFChron: Debra Saunders – Do not ask for whom the road tollsCCTimes: Lisa VorderBreuggen: Manteca Republican May Have Helped Put Sarah Palin On The BallotSacBee: Dan Walters – California slavery still lives

Articles of Interest… Read More