A few taxpayer victories in an anti-taxpayer California Legislature

By Jon Coupal | Ronald Reagan once said, “Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” With a record $130 billion budget, we know that California state legislators are adept at all three practices, but none more so than taxes.

A weekly column by Jon CoupalDemocrats in Sacramento spent 2017 jamming three separate tax and fuel-cost hikes into law. They renewed the cap-and-trade program, continuing a multi-billion-dollar increase in fuel costs that brings in state revenue to fund high-speed rail. They invented a new tax on recorded documents that is supposed to fund affordable housing. And of course the SB 1 gas and car tax increase was said to be needed to fund road repair, even though billions of dollars have been diverted away from maintenance over the last decade. In the midst of an $8 billion surplus, Sacramento was steadily increasing taxes.

But fortunately, 2018 hasn’t been as dreadful for taxpayers as 2017. Here’s a sample of the proposals that, for now, have failed to pass:

To read the entire column, please click here.

Posted in Howard Jarvis Taxpayers Association, Jon Coupal | Leave a comment

Fullerton City Hall is closed today for another three-day weekend

City Hall Closure Dates and
Observed Holidays

2018
January –1*, 12, 26
February – 9, 19*, 23
March – 9, 23
April – 6, 20
May – 4, 18, 28*
June – 1, 15, 29
July – 4*, 13, 27
August – 10, 24
September – 3*, 7, 21
October – 5, 19
November – 2, 11*, 16, 22*, 23*,30
December – 14, 24*, 25*, 26^,27^, 28, 31*

*Holiday observed
^Winter Closure

Fullerton City Hall

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Nearly 900% increase in CalPERS benefits dwarfs economic growth, taxpayers’ ability to pay

The total pension benefits promised by the California Public Employees’ Retirement System (CalPERS) increased 886 percent from 1987-2016 — a rate 21 times greater than the cumulative increase in the state’s population, according to a just-released analysis from Transparent California.

The growth in promised CalPERS benefits dwarfs the rate found in a variety of other economic metrics, as shown below:

https://transparentcaliforniablog.files.wordpress.com/2018/07/calpersgrowth4.png

Transparent California credits Ted Dabrowski and John Klingner of Wirepoints as the source of inspiration for this chart and analysis. In Illinois state pensions: Overpromised, not underfunded, Dabrowski and Klingner irrefutably demonstrate that the true source of Illinois’ pension crisis is the explosive growth in promised benefits, not a lack of funding.

Transparent California Executive Director Robert Fellner believes the same applies to California.

“Some politicians and government unions have claimed that last decade’s market downturn is the cause of California’s pension crisis. As this data makes clear, the real cause is the tremendous growth in the size of the benefits that were promised.”

The chart below reflects the cumulative growth in promised CalPERS pension benefits (accrued liabilities) alongside a variety of California economic metrics:

California Economic Metrics Growth from 1987-2016
Promised CalPERS pension benefits 886%
Total Personal Income 331%
Total State Tax Collections 311%
Median Household Income 121%
Inflation 119%
Population 41%

Fellner observed that blaming the inevitable market downturn as the source of CalPERS funding woes is analogous to a gambler citing a bad run at the blackjack table for having less-than-anticipated funds.

“Elected officials’ willingness to take on such massive debt, not the fact that the stock market sometimes goes down, is the root cause of California’s pension crisis,” he said

Posted in CalPERS, Pensions, Transparent California | Leave a comment

Sen. John Moorlach and CalPERS CEO to discuss ‘socially conscious’ pension investing today in Huntington Beach

State Senator John Moorlach and CalPERS CEO Marcie Frost will be facing off this afternoon in Huntington Beach over the issue of “socially conscious” investing by pension funds. The event will be held in Huntington Beach’s City Council Chambers and it will start at 4:30 pm.

For more details, read the story in the OC Weekly.

https://www.ocweekly.com/wp-content/uploads/2018/07/Town-Hall-Flyer-712-768x1075.jpg

Posted in CalPERS, John Moorlach | Leave a comment

Why the U.S. should drop all tariffs

By Veronique de Rugy | President Trump announced tariffs on $50 billion of imports from China, $34 billion of which came into effect on July 6, saying it will force that country to be a better trading partner. China, not surprisingly, said it would slap $50 billion of its own tariffs on American goods in response, to which Mr. Trump threatened to raise the stakes by another $200 billion.

On trade, the president has been all over the place. One day he threatened to impose tariffs on our NATO allies on national-security grounds. Another day, he exempted these allies from the tariffs. A few weeks later, he changed his mind.

The United States should stop the scattershot, pointless nonsense on tariffs and go the other way, and hard: It should drop all tariffs, even if the rest of the world doesn’t follow.

Mercatus CenterEconomists since Adam Smith have understood that free trade is the best policy. Studies show that countries with freer trade have both higher per-capita incomes and faster rates of productivity growth. Economists have also long understood that barriers to trade, while pitched as a way to help domestic workers, always heavily penalize domestic consumers. For instance, when Uncle Sam imposes stiff barriers on sugar imports to protect a few hundred producers in Florida and Louisiana from competition, these farmers’ gains come at the larger expense of consumers who are obliged to pay more than twice the world price of sugar, on average, each year since at least 1982.

The same is true of Mr. Trump’s steel tariffs. Claiming that they protect a vital industry and its 140,000 workers, tariff supporters never mention how much harder they make things for the 6.5 million manufacturing workers in steel-consuming industries. Add to that number all of us who consume goods made of steel, and you get an even larger figure.

Consider a domestic company that imports specialty European steel not produced in the United States. Thanks to the tariffs, this company faces an instant 25 percent price increase. It will shift some of that cost onto its customers, making the final product more costly and thus less competitive at home and globally. Or the company might shift manufacturing abroad to gain access to cheaper materials.

In both cases, the company probably takes a hit and might even lay off American workers. That’s what happened in the aftermath of President George W. Bush’s 2002 tariffs to the tune of 200,000 jobs lost in steel-consuming industries.

The fact is, free trade is a robustly good policy — which doesn’t mean that it affects all Americans in the same way or at the same time. Not only is it the best policy when other governments practice free trade; but it’s also the best policy even when other governments are wildly protectionist. By lowering its trade barriers, a government enriches its citizens regardless of the policies implemented by foreign governments. This idea runs counter to the public’s assumption that we benefit from lowering our trade barriers only if other governments lower theirs.

To continue reading in the New York Times, please click here.

Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University.

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‘Repeal the Gas Tax’ organizing meeting slated for Thursday in Yorba Linda

An organizing meeting for “Yes on 6″ — the ballot measure to repeal the gas tax — will be held this Thursday evening at 6:30 pm at 4901 Main Street, Yorba Linda (click for map). For complete details, see below.

If you plan on attending, an RSVP is requested; to RSVP, please click here.

Yes on 6 - Repeal the Gas Tax

 

Posted in Carl DeMaio, Gas Tax, Yes on 6 | Leave a comment

Withdrawal of the Taxpayer Protection Act could haunt the American Beverage Association

By Jon Coupal | By now, political observers have heard how a series of negotiations in Sacramento resulted in three initiatives slated for the November ballot being withdrawn by their respective proponents. The blame (or credit, depending on your perspective) for these deals has been attributed to a 2014 bill authored by then-Senate Leader Darrell Steinberg, D-Sacramento, which allows proponents to withdraw an initiative even after it has qualified for the ballot. It was believed that this reform would result in more compromises being hammered out with the Legislature on contentious issue

A weekly column by Jon CoupalOne of the measures withdrawn last week was the Taxpayer Protection Act, which would have strengthened a number of existing constitutional provisions including the two-thirds vote for local taxes. While a broad coalition of business and taxpayer groups backed the measure, and even provided significant input into its drafting, the lion’s share of financial support came from the American Beverage Association.

Faced with massive opposition from local governments and public-sector labor organizations, ABA decided to strike a deal with the Legislature to prohibit any future local soda tax increases between now and 2030 in exchange for removing the Taxpayer Protection Act from the ballot. The decision may also have been based, at least in part, on the perception that other potential financial backers for the campaign would be focused on other initiatives on the November ballot.

Nonetheless, ABA’s decision to withdraw the measure in exchange for limited protection for a specific industry blindsided many interests in the Capitol, including taxpayer organizations which were excited for an opportunity to campaign for strong taxpayer protections in an absurdly high-tax state.

To read the entire column, please click here.

Posted in Howard Jarvis Taxpayers Association, Jon Coupal, Soda tax, Uncategorized | Leave a comment

Do Democrats in Sacramento really want to fix Prop. 13 problems?

By Thomas D. Elias | If it’s ever to be fixed, only a ballot proposition can repair the largest and most obvious inequity caused by Proposition 13, the landmark 1978 tax-cutting initiative that causes next-door neighbors in identical homes to pay vastly different sums for property taxes.

But the other big problem area of the tax-cutting measure originally sponsored by the late political gadflies Howard Jarvis and Paul Gann could be solved by a simple vote of the Legislature. That inequity is a loophole allowing some commercial and industrial properties to escape the tax increases that normally come when a building or lot changes hands. Sadly, this loophole will remain in place at least another year, after legislative Democrats in late spring killed a Republican bill to close it.

[...]

The latest effort, carried by state Republican Senate Leader Patricia Bates, from Laguna Niguel, failed on a 3-2 vote of the Senate’s Governance and Finance Committee, with two ostensibly liberal Los Angeles County Democrats — Ed Hernandez and Robert Herzberg — abstaining. Both votes for the Prop. 13 reform came from Orange County Republicans, John Moorlach and Janet Nguyen, while Democrats Jim Beall of San Jose, Richard Lara of East Los Angeles and Mike McGuire of Ukiah all voted no.

To read the entire column, please click here.

Posted in Howard Jarvis Taxpayers Association, Jon Coupal, Prop. 13 | Leave a comment

Coy about taxes and pension costs

By Dan Walters, CALmatters | California’s economy may be booming, but throughout the state, local governments—including school districts—are feeling the financial pinch and asking their voters to approve new taxes of one kind or another.

There were 111 local tax measures on the June primary election ballot, the vast majority of which passed, according to municipal finance guru Michael Coleman of CaliforniaCityFinance.com.

Dan WaltersDozens more—sales taxes, parcel taxes, marijuana taxes, utility taxes and hotel taxes—are being planned for the Nov. 6 general election.

So why are so many local entities feeling strapped?

Local officials will tell you, if you don’t quote them by name, that it’s mostly because their mandatory payments into the state’s two big pension funds are soaring.

The California Public Employees Retirement System (CalPERS) and the California State Teachers Retirement System (CalSTRS) lost tens of billions of dollars during the recession a decade ago and have never fully recovered.

CalPERS has steadily and sharply increased financial demands from cities, counties and school districts for their civil service workers while the Legislature and Gov. Jerry Brown cranked up contributions to CalSTRS from school systems to cover teacher pensions.

However, while seeking more money from their voters to cover their ever-increasing retirement costs, local officials have been very reluctant to say it’s for pensions, fearing backlash at the polls. Rather, on the advice of high-priced “consultants,” they promise the new taxes will enhance such popular services as police and fire protection and parks.

We can expect more such propaganda this fall, leading up to the election.

One example is in Sacramento, whose mayor, Darrell Steinberg, wants his voters to reauthorize a half-cent sales tax that will soon expire and to add another half-cent.

In a recent speech, he called his proposal “a real game changer” that would finance affordable housing, shelters and services for the homeless, job training in low-income communities and small-business incentives.

However, simple arithmetic tells us otherwise. The additional half-cent of sales tax would generate less than $40 million a year, city budget documents say, while by the city’s own estimate, its mandatory payments to CalPERS are expected to increase from $81.6 million a year to $129 million by 2023.

To its credit, the Sacramento Bee pointed out the looming effect of the city’s rising pension costs. The state’s other news media should follow suit as their local officials tout the benefits of increasing taxes. Reporters can easily calculate projected pension cost increases from CalPERS data and the potential revenues from sales tax data.

Meanwhile, one city just a half-hour’s drive from Sacramento is doing it the right way, telling voters why it needs more money.

Lodi also will place a half-cent sales tax increase on the November ballot and its officials are not shy about the reason.

Lodi City Manager Steve Schwabauer has been a leading figure in efforts to persuade CalPERS to moderate its demands, arguing that cities such as his will face insolvency unless they get relief or persuade voters to raise taxes.

Schwabauer told the city council, before it voted unanimously to ask voters for the tax hike, that without it the city will see operating deficits beginning next year.

“The cause of this, point-blank, is CalPERS and our pension fund, and I have spent at least two years of my life fighting with CalPERS,” Councilwoman JoAnne Mounce said.

Such candor may not make it easier to persuade voters, but it’s the right thing to do.

Posted in Dan Walters, Pensions, Taxes | Leave a comment

CommonSense: Ought implies Cantifornia

microstamping, bullet, California, law, guns, gun control

By Paul Jacob | “Strip away the absurdity,” writes Scott Shackford at Reason, “and it’s essentially a very technical ruling.”

Shackford is explaining a bizarre recent judgment of the California Supreme Court.

Politicians in Sacramento had, years ago, passed a gun control measure requiring gun manufacturers to “implement microstamping technology that would imprint identifying information on bullets as they were shot from semi-automatic weapons.” In 2014, Smith & Wesson announced that it would pull some guns from the California market rather than comply. Why? The technology just wasn’t ready yet.*

Since California’s Civil Code contains a section reiterating an old commonsense principle to the effect that the “law never requires impossibilities,” the National Shooting Sports Foundation sued to block the law.

But the group just lost.

The Court did say it could protect citizens from punishment, but it refused to nullify the legislation on constitutional grounds.

Unanimously.

Why do this? Apparently to protect California politicians in their ongoing social engineering schemes.

The dollar costs of trying to comply with impossible demands are huge, of course. But the biggest costs may be more subtle.

In moral philosophy, it is a truism to say that “ought implies can.” In natural law as understood long ago, an impossible law was thought not a law at all, justifiably ignored by anyone and everyone.

In a just state, flouting of maddening regulations like California’s would lead not merely to the defense of the absurdly put-upon citizen — as this court ruling still allows — but also to the nixing of the “impossible” law.

This is Common Sense. I’m Paul Jacob.


* Shackford notes that “a cynic might theorize that this is the law’s actual intent.” I wouldn’t limit that suspicion to folks given to cynicism. Pragmatists and political scientists and almost anyone else would be placing bets on that, too.

Posted in Paul Jacob | Leave a comment