It has been said that as California goes, so goes the country.
In an interview with The Financial Times, California Governor, Jerry Brown, said that he believes the wealthiest people in the state have a moral obligation to pay higher taxes. Proposition 30, championed by Brown, creates four high income tax brackets for taxable incomes in excess of $250,000, $300,000, $500,000 and $1,000,000.
“It takes a refined theory to say to billionaires that it’s easier to take three weeks of school away from kids in Los Angeles than it is to take 3% away from people who make hundreds of millions of dollars a year,” Brown said during the interview.
He added, “Luke 12:48 says: ‘For those of whom much has been given, much is required.’ Those at the high end can brace themselves for seven years and lend school kids a helping hand. I appeal to their sense of loyalty and fairness.”
Proposition 30 also raises the California sales tax rate by .25%.
The opposition trumpets that new taxes will do nothing to help California schools and only make matters worse for the average Californian, but the truth is without the increase in taxes, California schools face a new round of unavoidable cuts in a system already decimated by previous cuts.
Let’s put this in perspective for the average Californian. That average person doesn’t have to worry about having their state income tax raised because most people in the state don’t meet the $250,000 earnings threshold. But we all pay sales taxes every time we make a purchase. So what does that mean? It means we will pay one quarter of 1% more in sales tax at the checkout counter. In real dollars it boils down to additional 25¢ for each $100 in purchases, $2.50 extra for every thousand dollars spent, $25 extra for every ten thousand dollars. When you distill it down to actual numbers instead of fractions, it’s a lot easier to see that this is a painless but effective way of raising much of the desperately needed $6 Billion over the next seven years to bolster the educational system in the state.
As for those with high incomes, the additional 3% in California income tax will hardly be missed but it will make a huge difference in California schools.
California serves as a microcosm of the country at large. In a time when states and municipalities are facing the consequences of severe cuts to teachers, fire, police, and family programs, when the entire country is still within the grip of an economy that was plundered by the previous administration, quite frankly, I find it un-American and distinctly unpatriotic that some of the wealthy citizens of our society are hell-bent on keeping every last dime to themselves. Particularly when the Tax Policy Center, after studying Romney’s economic plan, has stated that it would cut taxes for America’s wealthiest citizens while raising taxes on the poor and middle class.
We are accustomed to hearing Governor Romney say that lowering taxes on the rich will translate to jobs. This is a patently ridiculous and nonsensical statement, since taxes have been low since George W. Bush rammed his tax cuts through Congress. The names of those Acts lend a certain irony: Economic Growth and Tax Relief Reconciliation Act of 2001 and Jobs and Growth Tax Relief Reconciliation Act of 2003. All these years later, we see the results and the question is, where is that economic growth and where are all those jobs that were promised as a result of lowering taxes for the wealthy?
Those on the right argue that Bush inherited a recession from Bill Clinton. It is true that Bush had a recession to deal with when he came into office and it is true that the attacks of September 11 caused damage to our economy as well as to our national psyche. Instead of combating the recession by infusing money into the system, which has always been proven to be effective, George Bush took money out of the system with unfunded tax cuts and then proceeded to run up the national debt by initiating two off-the-books wars. When he left office, he left a financial fiasco unparalleled in modern times, with only the Great Depression overshadowing it. The policies of the Bush administration exacerbated the downturn he faced and turned it into a full-blown nightmare, but candidate Romney is relying on the very same people who advised George Bush to help him form his national policy. One has to ask: is this really a good idea? We’ve already been there and done that and the outcome stinks.
Barack Obama inherited those two off-the-books wars as well as an economy in freefall and a debt that was spiraling out of control. It wasn’t until he had taken office that the scope of the problem faced by this country became fully apparent. He has done everything humanly possible to rescue this country from sinking into a depression and he has succeeded. The Republicans complain that his policies have failed. They have not. They have, however, been slowed to a crawl by obstructionist tactics employed by the not so loyal opposition in their stated attempt to make him a one-term president.
President Obama realizes we need a balanced approach. We all know that there will be cuts on programs that we’d rather not see cut, but like paying a little extra sales tax in California, the result will be worth the effort. We will eventually – and that is the key word because our president did not come equipped with a magic wand – begin to see the results of all of us pitching in. A combination of targeted tax hikes and equally targeted cuts in programs will get us where we want to go. Even some top CEOs agree.
In closing, I’d like to borrow from Governor Brown and say, it takes a refined theory to say to billionaires that it’s easier to take money out of the pockets of people who are struggling to survive than it is to take 3-4% away from people who make hundreds of millions of dollars every year.
If you haven’t voted yet, VOTE!