22 Dec

New tax increases in California stir debate about adding to exodus

Fox News:

A vote last month that makes Californians among the highest-taxed residents in the country is sparking debate about whether the Democrat-back initiative will backfire, by forcing high-earners to join a long exodus from the cash-strapped state.

Democratic Gov. Jerry Brown successfully pushed the tax increase by suggesting that high-earners must shoulder the largest burden in bailing out the state, particularly its debt-ridden public school system.

However, high unemployment and government debt have already sent residents fleeing in large numbers – an estimated 225,000 annually for the past 10 years.
And the recently passed tax increase for families making more than $250,000 each year could further shrink the tax base for California, whose 2012 budget deficit is projected to hit $28 billion.

Much of the debate has raged among California advocacy groups and in the editorial pages of the state’s biggest and most influential newspapers.
“More is never enough for these people,” Kris Vosburgh, executive director of the Howard Jarvis Taxpayers Assoc., said about the Democrat-backed increase. “It’s hard to believe people will not leave.”

Vosburgh said his group is not an advocate for the wealthy and argued the tax increase atop other bad economic factors – including high gas and sales taxes – also have small and large businesses packing.

“With high taxes and heavy regulations, it’s just difficult to produce those widgets at a lower price than somebody in, say, Texas,” he told FoxNews.com on Tuesday.
Syndicated columnist Walter E. Williams wrote in The Orange County Register: “California politicians can fleece people in 2012, but there’s no guarantee they can do the same in 2013 and later years. People can leave.”

Ex-Californians over the past decade have already put roughly $5.67 billion into Nevada’s economy as well as $4.96 billion into Arizona and $4.07 billion in Texas, according to Manhattan Institute study titled “The Great California Exodus: A Closer Look.”

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About Curt

Curt served in the Marine Corps for four years and has been a law enforcement officer in Los Angeles for the last 20 years.

45 Responses to New tax increases in California stir debate about adding to exodus

  1. Soquel Creek says: 1

    Indeed, Proposition 30 was the most recent non-solution to the many challenges confronting California. Proposition 30 was funded with millions of dollars and supported via manpower by California’s top two political spenders–public-sector unions California Teachers Association (CTA) and the Service Employees International Union (SEIU).

    Now that they have their ill-conceived tax hike on ALL Californians behind them, perhaps they’ll actually work with other to fix California’s REAL problems, outlined below.

    Thank You Proposition 30 Supporters!
    http://soquelbythecreek.blogspot.com/2012/11/wecandobetter.html

    For those who are playing along at home, here’s why Proposition 30 is bad public policy and horrible tax policy–or, as California’s taxpayers call it, “the usual junk that flows from Sacramento.”

    California Proposition 30: Governor Jerry Brown’s Big-Government Tax Hike
    http://soquelbythecreek.blogspot.com/2012/07/california-proposition-30-governor.html

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  2. openid.aol.com/runnswim says: 2

    However, high unemployment and government debt have already sent residents fleeing in large numbers – an estimated 225,000 annually for the past 10 years.

    I’ve lived in California for 34 years. In that time, I’ve known a lot of people who have left the state and a lot of people who’ve moved into the state. I’ve never once known a single person who moved out of the state because of “high taxes” or “excessive regulation.” I’ve also never met a single Californian who worried about people moving out of the state or a single Californian who wanted more people to move into the state. The greatest NIMBYs I’ve known (the most anti-growth people) are conservative home owners. The only pro-growth conservatives I’ve ever known have been realtors, who make their money selling real estate.

    California is the first US state (and California tends to lead in everything) which has a population bubble. We have too many people, not too few people. Our ability to build freeways fast enough to even stay even with choking road congestion has long since been exceeded, no matter that we keep voting to tax ourselves more to build more roads and mass transit. Our houses cost between 3 and 4 times more than they do in states like Texas. Teachers can’t afford to live in the neighborhoods where they teach. Businesses can’t attract highly skilled workers because they look at the cost of houses and are unwilling to pay mansion sized mortgage payments for modest suburban tract houses.

    The taxes are a drop in the bucket, with respect to overall cost of living. And every time taxes are increased, government revenues go up. It’s simple arithmetic. It’s the opposite of voodoo economics, the now discredited concept that cutting taxes raises government revenues sufficiently to offset revenues lost through the tax cuts.

    When I moved here (in 1979) the prevalent attitude was already “welcome to California, now go home.” Mitt Romney is very careful with his money, including the taxes he pays. It’s telling that he and my younger daughter are going to be living in the same town (LaJolla). Wonder why he didn’t decide to retire to Texas. When a state has certain unique assets, these assets sell themselves, and this is what causes the population bubble, which leads to the high cost of living. It’s the states lacking in these assets that must rely on other factors to stimulate the growth they covet and that they would be otherwise unable to obtain.

    So California’s assets attract too many people for the economy to support. A state may understandably reach the point where it just can’t provide jobs and quality living space for everyone who wants to live there. An important component of an efficient market economy is worker mobility. Workers migrate to states which seek more people and offer incentives to attract them. Workers migrate away from a state which already has too many people and has reached the saturation point, with respect to the ability to create affordable living space and communities with tolerable levels of congestion. A state with overpopulation is justified in making the decision that it is more important to provide services and living environment for a finite number of people. Raising taxes achieves complementary objectives: increasing revenue and discouraging growth. It is eminently sensible.

    What California has going for it is the greatest critical mass of entrepreneurial assets in the nation. That’s why the new breakthrough businesses are conceived here and developed here and why these new business only start to farm out production to the “outsourcing states” when the imperative is to maximize production efficiency (as opposed to founding and growing paradigm-busting businesses of the future). California has ten times the venture capital investment of Texas. That pretty much tells the whole story. Investors voting with their wallets.

    – Larry Weisenthal/Huntington Beach CA

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  3. Pete says: 3

    @openid.aol.com/runnswim:

    Larry, I personally know people who have moved to Texas from California SPECIFICALLY to get away from the over regulation and excessive taxes, so I wave the BS flag at your initial propaganda.

    You reveal yourself to be a leftwing agitprop pusher with the term “voodoo economics” so the rest of your diatribe is easily dismissable.

    So if “government revenues always increase when taxes are raised” why is California projected to be $28 billion in deficit this coming year? Are you admitting the socialist government scams lead to overspending, hence the real solution is to CUT SPENDING?

    Income taxes do not effect income that has previously been earned, so if someone has multiple millions they have previously earned, they have no risk moving to Cali and buying a big house. If they are retired and don’t have income but are instead simply living off what they have already earned, the insane California tax rates wouldn’t affect them.

    If you think higher tax rates are so great at improving the economy, then why don’t you push for the ending of the ability to deduct your state income taxes from your federal taxes? That way you can REALLY enjoy how much of your income the state and federal government are stealing from you to buy the votes of the uneducated and the lazy.

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  4. Soquel Creek says: 4

    While I agree with some of Mr. Weisenthal’s assessment, taxed are my family’s #1 expenditure–between property tax, income tax (state & federal), payroll tax, and corporate tax.

    Despite near-record expenditures, the State of California never seems to have enough to fund basic government functions like public education.
    http://www.twitpic.com/b4gf0x/full

    The real crime in California isn’t how much tax is collected–it’s how poorly those taxes are spent (borrowing a line from Will Rogers).

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  5. openid.aol.com/runnswim says: 5

    Hi Pete, The term “voodoo economics” (applied to the discredited theory that tax cuts pay for themselves) was coined by none other than that left wing agitprop pusher George Herbert Walker Bush, when he ran against Ronald Reagan for the GOP Presidential nomination in 1980.

    California’s budget deficit looks large, because the state’s GDP is so much larger than every other state’s. Let’s compare the state debt to GDP ratio of California versus Texas, shall we:

    http://www.usgovernmentspending.com/state_debt_rank

    California 18.81%
    Texas 18.98%

    That’s correct, Texas is more heavily indebted, relative to its economy, than is California.

    To Soquel: Thank you for your good manners and intellectual honesty in giving me at least partial credit :)

    P.S. When I said that taxes were a drop in the bucket, relative to the overall cost of living, I was referring to the difference in state and local taxes paid by Californians, compared to the average state in the nation. This difference is much smaller than the difference between the average cost of living in our state, compared to the nation’s average. As noted, our houses are dramatically more expensive, and this has a huge negative impact on overall quality of life.

    – Larry Weisenthal/Huntington Beach CA

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  6. retire05 says: 6

    @Pete:

    Larry, the Lib, has tried to pass his manure here before. He used some private website, not a government website, to compare debt to GDP between California and Texas. The debt clock shows that California’s debt to GDP is 18.511% while in Texas it is 17.89%. Not the figures Larry claims.

    He also claims that it is the conservatives of California who are NIMBYs, yet offers no linke to prove that claim, while at the same time he moans how California has too many people in it clogging up his precious road ways. Nevermind that New York, a much smaller state, has more miles of highway than California.

    Yeah, home prices are higher in California than Texas. But the learned scholar, Thomas Sowell, explained why quite well in his book Housing Boom and Bust. It has everything to do with land use rules and regulations, not value.

    So Jerry Brown, Linda Ronstadt’s former paramour, claims that higher taxes will make the state solvent, then the State of California announced that it had an over $800 million short fall from its estimated revenue just last month. Ooops.

    California is seeing zero growth (which should make Larry the Lib happy) and you can’t build a state’s coffers when man power and businesses are fleeing. Shhhh, don’t tell Larry that. Eventually, he and the remaining 1,00,000 wealthy people in California can support the whole state by themselves. Oh, wait; the wealthy in California hire expensive tax lawyers to show them how to off shore their money and not have to pay California’s absurd income tax. And while everyone loves to bash Texas, California’s new residents are primarily illegals from south of our border. Remind us again, Larry, how many cities in California have filed for bankruptcy? Two, isn’t it?

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  7. openid.aol.com/runnswim says: 7

    Hi Retire,

    You see a big difference between California 18.81% Texas 18.98% (my numbers) and California 18.511% Texas 17.89% (your numbers)? Really? As I recall, you are the very same Retire05 who was mystified by 8th grade algebra.

    With regard to Sowell and “land use,” let’s bring in Soquel Creek (an intellectually honest conservative).

    Soquel: is the fact that California houses cost 3 to 4 times what houses cost in Texas owing to “land use restrictions?”

    Curt: How would you feel about building out Huntington Beach Central Park to put in more houses? Putting in high rises on the beach, between PCH and the ocean? Building 5,000 houses in the Bolsa Chica (wetlands reserve)? Can you answer this? And, if you choose to answer and you answer yes (which would put you in a minority of 5% of the residents of Huntington Beach), what would be your honest estimate of the impact that this would have on the price of houses in our fair city?

    – Larry Weisenthal/Huntington Beach CA

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  8. retire05 says: 8

    @openid.aol.com/runnswim:

    What makes you think I am confused about 8th grade algebra? Just because you tried to compare apples (SAT/ACT scores) with oranges (high school graduation rates), they are not one and the same except in your liberal mind.

    Now, while you worry about all those new residents clogging up your precious (and seemingly, personal) highways, let’s take a look at population density, shall we?
    California has 242 people per square mile of land, falling to number 11 under NJ, RI, Mass., Conn., Maryland, Delaware, NY, Florida, Penn. and Ohio. Seems you have lots of land that would facilitate expansion of your population, just no one wants to move to California anymore because of high taxation (not just income taxes) and the most unfriendly business atmosphere in the nation. And the fact that your politicans are batsh!t crazy.

    Oh, and when did Soquel Creek provide us with his credentials as a learned, and well experience, economist? And I can’t seem to find where he commented on land use rules and regulations. But he did comment on Prop 30 being bad public policy and bad tax policy, although you have been consistantly supportive of Prop 30.

    Run out of Aracept, Larry?

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  9. openid.aol.com/runnswim says: 9

    Hi Retire,

    What makes you think I am confused about 8th grade algebra? Just because you tried to compare apples (SAT/ACT scores) with oranges (high school graduation rates), they are not one and the same except in your liberal mind.

    You still don’t understand how clueless you truly are. You were the one who raised the issue of SAT/ACT scores. I pointed out that California’s SAT/ACT scores were higher than those in Texas, citing the College Board web site. You said, “aha, only 65% of California’s students took the SAT/ACT, compared to 69% in Texas.” I applied a little 8th grade algebra and deduced that if the additional 4% of California’s students took the SAT (matching the total who took it in Texas) and if these every single one of these extra students had missed every single question on the test, California’s students would still have outscored Texas’s students. You clearly didn’t understand this. You then moved the goal posts, rather than admitting that you were wrong. What about HS graduation rates? Well, that wasn’t the point you originally made. The point you initially made was about SAT scores. And you were wrong. Embarrassingly so. And you compounded the embarrassment with your obvious deficiency in middle school math.

    With respect to population density, the majority of the land in California is desert and mountains. No businesses want to locate there. What makes California attractive are the coastal areas. That’s where everyone wants to live and that’s where businesses want to locate. And those areas are totally built out. Don’t take my word for it. Ask Curt. Ask Nan, for that matter.

    Nan, what is the average price of a house in Long Beach in a safe area, where middle class people would actually want to live? How much green space is there in Long Beach in areas where middle class people would want to live?

    Any other conservative Californians out there? How many of you think that our high real estate prices are owing to land use restrictions?

    – Larry Weisenthal/Huntington Beach CA

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  10. Regarding debt levels of California vs. Texas, here’s an interesting chart courtesy of the State of California. It shows the debt and credit ratings of the ten most populous states.
    http://www.twitpic.com/b0i4ia/full

    TEXAS:
    ============================
    Credit rating: Aaa/AA+/AAA (Moody’s/S&P/Fitch) Excllent
    Debt to personal income: 1.5% (below the national median and median for the 10 most-populous states)
    Debt per capita: $588 (below the national median and median for the 10 most-populous states)
    Debt as a percentage of state GDP: 1.25% (below the national median and median for the 10 most-populous states)

    CALIFORNIA:
    ============================
    Credit rating: A1/A-/A- (Moody’s/S&P/Fitch) Lowest-rated state overall. Moody’s ranks Illinois lower than California.
    Debt to personal income: 6.0% (double the national median and median for the 10 most-populous states, tied for 2nd highest with Illinois)
    Debt per capita: $2,559 (double the national median and median for the 10 most-populous states, 3rd highest overall)
    Debt as a percentage of state GDP: 5.97% (double the national median and median, 2nd highest overall)

    SOURCE: State of California: Debt Affordability Report (October 2012), Figure 11, page 10.
    http://treasurer.ca.gov/publications/2012dar.pdf

    Bond Credit Ratings:
    http://en.wikipedia.org/wiki/Bond_credit_rating

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  11. Regarding ACT/SAT scores, high-school graduation rates, and so on, you might find this of interest. This uses results from the National Assessment of Educational Progress (NAEP) tests used by the U.S. Department of Education.

    California Public Schools and Performance on National Assessments
    http://soquelbythecreek.blogspot.com/2012/12/california-public-schools-and.html

    On these tests, at the 8th-grade level, Texas scores higher than California. Despite near-record state expenditures, the State of California chooses to spend elsewhere, instead of on public education.

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  12. retire05 says: 12

    @openid.aol.com/runnswim:

    Ask Curt. Ask Nan.

    Why do you liberals have this nasty habit of trying to pull others into your debates? Are you that damned insecure that you need backup?

    With respect to population density, the majority of the land in California is desert or mountains. No businesses want to locate there.

    Tell that to the 1/2 million people, living and working, in Las Vegas or to the thousands of businesses in Denver. You always have some excuse, don’t you, Larry? Wassa matter? Are your leaders in California too damn stupid to know how to develop desert and mountain areas? Or are they just suited for spending money they don’t have?

    And want to know what else about you I don’t like (beside your liberal irrational POV?)? Your arrogance. You really are a jerk, Larry. You let the insults fly, and then whine when you think someone has tweeked your nose a bit. Grow up.

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  13. openid.aol.com/runnswim says: 13

    Hi Retire,

    Las Vegas is a valley next to mountains. That’s the way all big cities in the western deserts are. Salt Lake. Reno. Tucson. Phoenix. Los Angeles. Has to do with snow melt and ground water.

    It’s not the responsibility or choice of CA, as a state, to develop the desert. That’s up to real estate developers. People get the type of government they want, in a democracy. Texas gets the government it wants. CA gets the government it wants. People that like Texas style government move to Texas, if that’s what they want. I don’t see a problem with this. Nor do virtually all Californians. It’s an essential part of market economics. Labor mobility. Let red states be red and let blue states be blue.

    But the point is that there are economic, geographic, and population density differences which all drive migrations. It’s simplistic to reduce it to “taxes” and “regulation.”

    I’d still like Curt, Nan, and/or other California conservatives to address the specific questions I directed to their attention. If anyone is willing to do this.

    – Larry Weisenthal/Huntington Beach CA

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  14. openid.aol.com/runnswim wrote:

    “Soquel: is the fact that California houses cost 3 to 4 times what houses cost in Texas owing to ‘land use restrictions?'”
    ======================
    Sorry, I’m not well versed in land use restrictions, but here are a few comments.

    Geography plays into the mix. California is split into three regions by the Coastal Range and the Sierra Nevada Range. Most of California’s population is on the Pacific side of the Coastal Range with a generally benign climate.

    The Central Valley, located between the Coastal and Sierra Nevada Range has limited water and is primarily agricultural. There’s been an ongoing battle in California over water development of the Central Valley. Due to geography and weather patterns, a number of sparsely-populated areas in the Central Valley suffer from poor air quality. Pollution blows in from metropolitan areas and is trapped by mountains and inversion layers.

    Most Polluted Cities
    http://www.stateoftheair.org/2012/city-rankings/most-polluted-cities.html

    The Nevada side of the Sierra Nevada Range is generally sparsely populated because most of it is desert. It’s beautiful, but not many choose to live there.

    Although I haven’t spent much time in Texas, there do not appear to be many geographical limitations on development. By California standards, Texas is big and flat in all directions.

    Transportation (or the lack of it) is a major “land use issue” that drives up housing prices. Take a look at the following chart. California has an abundance of bad commutes. This is a combination of geography, density, and distance.
    http://thumbnails.visually.netdna-cdn.com/HowLongIsItTakingAmericansToGetToWork_50184bc5d3d02_w587.png

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  15. retire05 says: 15

    @openid.aol.com/runnswim:

    Larry, if developers thought they could make a buck in the desert or mountains of California, they would. But the first requirement is a business friendly atmosphere that encourages that construction. California, consistantly, ranks at the bottom of the nation for a business friendly atmosphere. Texas has ranked #1 for the last 7 years. That is why companies, like Toyota, move from your state to mine.

    Stop making excuses because your state sucks when it comes to simple logic.

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  16. Nan G says: 16

    Larry, don’t you find it ironic that the very same environmentalists who refused to allow buiding of homes in ”wetlands,” or beach fronts are allowing ancient Indian burial and other sacred Indian sites as well as native habitats for desert tortoises and bats and rare desert birds and lizards to be destroyed for solar arrays, wind farms and high speed rails?

    I sure do.
    Those things of real value to California were tossed aside like yesterday’s paper by those so-called ”greenies.”
    And for what?
    Not the energy.
    The SUBSIDIES.
    And you know it!

    As for ”safe” areas in LB, there are fewer and fewer, Larry.
    Housing Authority has given so much to absentee landlords to put in the indigent that decent people are being crowded out all over the city.

    I’ve mentioned that in our 27 unit condos the takers now outnumber the makers.
    And those condos are on the sea side of Ocean Blvd!
    Most of these people are only slightly crazy, like the burned out hippies from the SF ’60s who both have hepatitus and enough personality disorder as to be medicated into drooling slurring all the time.
    Others have already proven dangerous….rich relatives shuffle them off to live on their own here rather than be anywhere nearby when (not IF ) they go off.
    Four different units are occupied by people who have restraining orders filed on them!
    They make the promiscuous gay guys and the always fighting lesbian “couple” seem almost tame in comparison.
    The amateur tattooist (you should hear the screams!) and the street con artists are in process of being evicted (they’ve fought it for months with free legal aid) and they are going to RUIN whatever they can here before they go.
    When we move away it will leave only one owner-occupier in the entire place.

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  17. retire05, you forget that California is “the oasis of Democratic politics” according to Debbie Wasserman Schultz, chairwoman of the Democratic National Committee. California has been ruled by one-party for a few decades now. One party held nearly 2-to-1 majorities in BOTH chambers of the California Legislatures. Thanks to the recent election, the same one-party rulers now have supermajorities in both chambers and own every major state-wide office. Heck, even our last “Republican” Governor would be a Democrat in most states.

    You can see what the policies of our one-party rulers have wrought on everyday Californians. As a fourth-generation native Californian, please let this serve as a warning to others.

    California: The Oasis of Democratic Politics
    http://soquelbythecreek.blogspot.com/2012/10/california-oasis-of-democrat-politics.html

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  18. Curt says: 18

    @openid.aol.com/runnswim:

    I’d still like Curt, Nan, and/or other California conservatives to address the specific questions I directed to their attention. If anyone is willing to do this.

    No idea….all I know is that except for the weather this State sucks big time. Democrats, liberal policies and taxation has sucked everything that was once good about this state. I won’t be staying when I retire.

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  19. retire05 says: 19

    @Soquel Creek: @Soquel Creek:

    I have said, repeatedly, that California is a beautiful state. But you can’t eat “beautiful.” People need jobs and a state needs tax revenue, and when your liberal politics cause two cities to go bankrupt, and the state coffers are empty and your running on fumes, it is time to change those policies that obviously doesn’t work. What good are beautiful beaches if you can’t afford the gas to drive to them? What about the mountains? Who goes there? The Hollywood ultra rich who offshore their own money to avoid paying California taxes?

    Yeah, my state has beaches (where you can see oil rigs that look like tiny dots) and mountains, although not that high by Colorado standards and desert and farm lands with rich, black soil, and our own version of the Grand Canyon and the piney woods and flat lands that never seem to end. And to some, it may not hold the beauty that they think they need. But it also has jobs and not all of them are minimum wage jobs as some claim, and it has a business environment that let’s companies know we have hung out the Welcome sign for them and we want them to come here and create jobs for our people.

    Austin has replace Silicon Valley, and Houston is the leading city in energy. Texas has exceeded California in the production of wind generated power, and we even sell electricity to California. But the best thing about my state, Soquel Creek, are its people and their attitude toward government of any kind. You want to live in the piney woods in a ramshackeled two room cabin? Fine, do it. You want to work your tail off and earn lots of money, do it and we believe you should get to keep most of what you make and that your labor doesn’t belong to the tax man. Freedom, Soquel Creek, that is what we are all about.

    But Larry obviously loves California and can afford to live there and I say “Great!” At least I know he is one less liberal that will move to Texas because he can no longer afford to live in his decaying state.

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  20. Skookum says: 20

    Larry, you mention the population bubble, I wonder if you know the ratio between new undocumented, unskilled workers and skilled, literate workers who choose to leave.

    Have you talked with primary teachers in HB? They have told me how difficult it is to teach non-English speaking kids with apathetic parents.

    Now, I don’t want to endure a barrage of racist taunts from the peanut gallery, since I will wager I have far more friends among this group than anyone who reads these pages.

    A note you might be interested in Larry, a few weeks ago on the Central Coast, I was speaking to a new acquaintance, a ranch manager. He was lucky enough to have been included in Reagan’s Amnesty program, and he told me his son was starting his residency and his daughter was in undergraduate school, and planning to go into medicine. His life was the real American Dream; unfortunately, there are still those who plug up the schools with poor attitudes against learning the gringo culture.

    I wonder how many non-productive people are coming to California because of the promiscuous offerings of government assistance in California. The old Toyota takes up the same amount of space on our freeways, but often it isn’t insured and the driver isn’t licensed. If you lose skilled people and replace them with unskilled people, the economy suffers. If you replace the skilled worker with two unskilled workers, the storm clouds are forming and we had better get ready for a storm.

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  21. retire05, don’t get me wrong. Despite having spent only two weeks in Texas, I like what I saw. The people I met were great! Hill Country was beautiful though quite humorous coming from the Santa Cruz Mountains in California. I have more elevation in my own yard! My total experience is I-10 from El Paso and I-35 from San Antonio to Dallas. I drove across three states to get to Dallas–all of them called Texas!

    During my visit, I had the extreme pleasure to have a surprise visit from Texas Governor Perry, who made an impassioned plea for me to move my business to Texas. There were about 100 other business owners from various states at the meeting. He certainly sold the low tax message and business friendliness (funny, I don’t think I’ve EVER heard that message in California). I showed him charts of California Governor Jerry Brown’s Proposition 30 tax hikes (see links) and he had the correct response. He said, “Man, that’s just crazy.” Look for Texas and compare it to Texas in both charts.

    California Proposition 30 Sales Tax Hikes Compared to the Other 49 States
    http://1.bp.blogspot.com/-cVMwG3RuN_g/UAHREMJ542I/AAAAAAAAA6g/GDYAtPpj8xI/s1600/ca_sales_tax_rate.png

    California Proposition 30 Income Tax Hikes Compared to the Maximum Income Tax Rates in the Other 49 States
    http://3.bp.blogspot.com/-6O4pf0UsrtA/UAHQDwARNOI/AAAAAAAAA6Y/_dxVVXdAwqI/s1600/Brown's+New+Tax+Hike+Compared+Nationally.png

    Unfortunately, due to family ties, I’m stuck here. I just hope I can encourage those outside California to help us take back the state from the special interests that run this state. After all, without your help, you’ll have more Nancy Pelosi’s (an import from Maryland), more Barbara Boxers’ (an import from New York), more Jerry Brown’s, more Maxine Waters’, more Hilda Solis’, etc. Just wait until you get to meet some of our other fine state-level politicians like Mark Leno, Darrell Steinberg, Tom Ammiano, or L.A. Mayor Antonio Villaraigosa. Boy will your head spin! Don’t forget, California has the nation’s largest Congressional delegation and 55 electoral college votes. You want to fix the U.S.? Then PLEASE help us win back California from the special interests. Your future depends on it!

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  22. retire05 says: 22

    @Soquel Creek:

    I have made that I-35/I-10 trek. When you hit Fort Stockton you think you have reached the ends of the earth.

    I understand what you say about your politicians from California. We have our own idiot to content with; Sheila Jackson-Lee, an import, not a native, who constantly says something stupid to embarrass us. Oh, she’s not the only one; my own Congressman, Lloyd Doggett, crook extraordinaire.

    I’m glad you got to meet Rick. The press, due to Rick being a native born Texan, like to portray his as some country bumpkin who can’t find his way out of a wet paper bag, but results don’t lie, and under his guidance, our state has done well, leading in job growth and economic recovery, compared to all other states. His message to governments when it comes to business is simple; don’t over tax, don’t over regulate, make the regulations fair, and more importantly, predictible and business will know what to expect down the road so they can plan their future.

    The way I see it, the problem you have in your state is not so much the fact that you seem to have imported the most left leaning politicians you could find, but your citizens. People like Larry, who support higher taxation but he wants it for everyone, not just himself. He wants people to leave California because the roads are clogged making that an inconvenience for him. He loves the beauty of the state and doesn’t want to do anything to threaten that so he will naturally support those who don’t want to access California’s own natural resources. Larry holds a M.D., so he not exactly some poor slob just trying to get by or create a business from the ground up. He’s made his mark. To me, he is the epitome of what is wrong with California.

    Now, don’t get me wrong. We have our own brand of lunacy in Texas. Austin is not called “The San Francisco of the Southwest” for nothing. It should tell you something when a city’s motto is “Keep Austin Weird.” But it is just a small segment of my state, and basically overruled when it comes to state government. So yeah, we have pockets of liberalism (Austin, El Paso, a segment of Dallas) but they are not a big enough voice to count.

    Yesterday, after this thread appeared, I was reading about the number of companies that have left California, or at least moved their national headquarters, to Texas. The number is not insignificant. Businesses will always do what it takes to make sure they remain profitable, and if California is going to choke them with taxation and regulations, they are going to continue to leave. It stands to reason that if you are located in Los Angeles, and you can move your company to Houston where the cost of living and taxation for your employees is less, then their salary dollars go further and if your company is paying less in taxes, you can afford to give greater dividends to your share holders and higher raises to your employees. It is just good business sense. Nothing brilliant about it.

    My biggest fear is that California will get on its knees to the federal goverment (i.e. Obama) and beg it to force the rest of us to bail you out. No one in Missouri or Iowa or Oklahoma should have to pay taxes to repair the damage brought on by your own politicians. Prop 30 is not going to work. California is bleeding people and businesses and that is the source of your tax revenue. November’s short fall announcement is a vision of things to come for your beautiful state.

    One other point I would like to make: Larry has bragged about California’s gun laws and how they work. While it is true that the murder by gun rate is down all across the nation, California saw 1,220 gun murders in 2011, down 3% compared to Texas’ 699, down 13%. California saw almost twice the number of gun related murders than Texas, but you don’t have twice the population to account for that. So I guess all those strict gun laws are just not doing the trick. But if you’re some thug thinking about shooting up a movie theater in Texas, you better take into consideration that a number of movie goers are going to be armed and your not going to have an Aurora cake walk.

    I really don’t know what we Texans, or anyone from any other state, can do to help you change the attitude in California. I am sad to say that I think that falls directly on you who live there. All we can do is effect our own local elections, and try to send enough people to D.C. to offset you. One thing that I have not seen in California that I am seeing in Texas is the recruitment of Hispanics into the conservative movement. Keep your eye on Ted Cruz, a first generation Hispanic who is going to make waves. Skookum talks about someone he knows who was part of the Reagan amnesty. That is another thing I find different between Texas and California. The attitude toward Hispanics. Our kids are taught that Hispanics fought at the Alamo, signed our first state constitution and played a large part (Juan Sequin’s troops) in our revolt against Mexico. We celebrate our Hispanic influence and it is a viable part of our culture, but when it all boils down, we, Anglo, Black and Hispanic, are Texans first. Having good friends who migrated here from California, they told me that is not the case there. Perhaps that is simply their view, but I see nothing to dispute that opinion.

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  23. Aqua says: 23

    @openid.aol.com/runnswim:

    I’ve lived in California for 34 years. In that time, I’ve known a lot of people who have left the state and a lot of people who’ve moved into the state. I’ve never once known a single person who moved out of the state because of “high taxes” or “excessive regulation.”

    Not the only reason I left, but definitely one of the reasons.
    @Curt:

    I won’t be staying when I retire.

    There are some things about California that I will always miss. But freedom is oh so much better than tyranny.

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  24. Pete says: 24

    @openid.aol.com/runnswim:

    I am well aware of who coined the term “voodoo economics”, the failed one term president who stupidly believed the democrats in Congress who lied when they said they would cut spending if Bush would raise taxes. Bush the first was never conservative, and was the major mistake Reagan made when he picked his former adversary as his VP. Your use of voodoo economics demonstrates absolutely your leftwing agitprop zealotry.

    Texas has a pending budget SURPLUS without a state income tax. THis is in spite of having a severe shortfall just 2 years ago that was treated with budget CUTS and opening up the oil and gas sectors to increase economic activity. More jobs means more tax revenue without having to raise rates like the marxist “progressive” income tax system. Don’t take my word for it – here is the liberal Austin newspaper reporting: http://www.statesman.com/news/news/state-regional-govt-politics/state-tax-collections-soar-setting-up-chance-for-r/nSLMn/

    California has the highest debt load and worst deficits of any state DESPITE having the now highest state income tax rates in the country.

    Income taxes designed to punish hard work and success out of a deliberately misapplied sledghammer of guilt do not improve the economic situation for anyone. “Free” government benefits and money do nothing except enlarge the parasitic class and hence the voting pool for unethical leftwing politicians motivated solely by their unquenchable thirst for personal power and aggrandizement over their fellow man.

    Stay in Cali, Larry. Enjoy the fruits of your dystopian ideology. But you need to understand that those of us who have worked hard are not going to bail your collectivist tarpit out of the hole you’ve gleefully dug yourselves.

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  25. openid.aol.com/runnswim says: 25

    What matters is not “debt load,” but rather debt load as a function of state GDP. California and Texas have precisely identical debt to GDP ratios. California has no greater debt problem than does Texas. California annually subsidizes the nation to the tune of $50 billion more in taxes sent out of the state to DC than put back into the state with federal funds from DC. Most red states are net recipients of Federal largesse. California, therefore, directly subsidizes the economies of most red states.

    California has a substantially greater GDP per capita than does Texas. So we have a stronger economy and an equivalent debt level. Those are cold, hard facts.

    It’s interesting that all the arm chair economists on this blog are certain that California voters made a mistake in voting to increase their taxes, while the professional economists at Standard and Poors, who are responsible to investors for rating California’s credit, have stated that the passage of Proposition 30 was a highly positive development with regard to improving California’s credit position. Likewise, bond investors are voting with their pocketbooks (in favor of California’s future), just as venture capitalists continue to vote with their pocketbooks (in favor of California’s future).

    http://www.bloomberg.com/news/2012-11-09/even-california-shows-halo-with-insatiable-demand-muni.html

    Now that voters have approved Gov. Jerry Brown’s tax-hike plan, Standard & Poor’s said California’s financial future is brighter.

    The ratings agency called the taxes the “linchpin” of Brown’s effort to fix the state budget, and it said the benefits will last even after the tax hikes expire in coming years.

    http://latimesblogs.latimes.com/california-politics/2012/11/california-finances.html

    http://en.wikipedia.org/wiki/List_of_U.S._states_by_GDP

    Merry Christmas, everyone!

    – Larry Weisenthal/Huntington Beach CA

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  26. @openid.aol.com/runnswim: Some of you data is out of date or incorrect.

    Here is data directly from the California State Treasurer’s office, via the “State of California: Debt Affordability Report (October 2012).” See Figure 11, page 10.
    http://treasurer.ca.gov/publications/2012dar.pdf

    Debt-to-GDP Ratio:
    ===============
    TEXAS: 1.25% (below the national median and median for the 10 most-populous states)

    CALIFORNIA: Debt as a percentage of state GDP: 5.97% (double the national median and median, 2nd highest overall)

    I’ve heard the claim many times, even from a Democratic Party State Senator from Southern California, that Proposition 30 caused an upgrade in California’s credit rating. Here are the facts. Yes, California’s credit outlook was upgraded from “Stable” to “Positive”. Yet, California STILL has the lowest overall credit rating of any state! Thanks to Proposition 30, we’re just not as distant a last place. Woohoo! Only Illinois has a lower rating from Moody’s because Moody’s downgraded Illinois to below California. California was not upgraded.

    Credit Rating:
    ===============

    TEXAS: Aaa from Moody’s, AA+ from S&P, AAA from Fitch (i.e., good to excellent)

    CALIFORNIA: A1 from Moody’s, A- from S&P, A- from Fitch (overall, the lowest-rated state in the nation with ratings a step above “junk” from S&P & Fitch)

    Here’s what the bond ratings mean.
    http://en.wikipedia.org/wiki/Bond_credit_rating

    There’s also a big difference in the “potential” to generate revenue. California ALREADY has the nation’s highest state sales tax rates and the nation’s 1st, 2nd, 3rd, and 5th highest marginal income tax rates. Texas, by contrast, has NO INCOME TAX. Texas has the potential to increase revenue if they need it without further damaging their private-sector economy.

    Texas is also ranked #1 as the place for business by a national survey of CEOs. California is ranked DEAD LAST (i.e., worst in the nation) and has held that distinction for 8 consecutive years. California has indeed become the “oasis of Democratic politics.”

    California: The Oasis of Democratic Politics
    http://soquelbythecreek.blogspot.com/2012/10/california-oasis-of-democrat-politics.html

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  27. openid.aol.com/runnswim says: 27

    Hi Soquel,

    This thread is about whether or not the passage of Prop 30 was or was not a positive development for California. It is obvious from your website that you were very much opposed to passing Prop 30. The facts are that, in the opinion of both credit rating agencies and investors, the passage of Prop 30 was considered to be a strong positive. Perhaps you are right and the professionals who do the rating are wrong and the investors who bet with their wallets are wrong.

    My figures were neither incorrect nor out of date. The data you cite simply reflect state government debt as a function of GDP. In different states, the percentage of total government services paid by state governments, as opposed to county and city governments, is highly variable. The numbers I cited were ratios of total government debt per GDP (where total government is state, counties, cities, school districts, etc.). Both California and Texas have total government debt to GDP ratios on the order of 18%. Even Retire05 agrees with me on this (citing numbers supplied by Retire05).

    – Larry Weisenthal/Huntington Beach CA

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  28. @openid.aol.com/runnswim:

    Yes, but I used numbers actually provided by the State of California themselves, both for state debt-to-GDP ratios and for the State of California’s and Texas’ credit ratings. I believe that the rating agencies are correct. Based on the numbers, California State government deserves the nation’s lowest credit rating. The state is fiscally irresponsible. It refuses to enact necessary reforms. It refuses to adjust spending downward to match income. It refuses to modernize our overly-progressive tax system that results in massive revenue swings. It refuses to reduce the state’s tax burden in order to improve its business standing.

    There are many reasons why California State government is ranked as the nation’s worst-run, for two consecutive years now.
    http://finance.yahoo.com/news/the-best-and-worst-run-states-in-america-150415625.html

    You and I both want a good state government and prosperity for the people of California. However, too many Californians refuse to acknowledge reality. As they say, you can deny reality but you cannot deny the consequences from denying reality.

    Indeed, there are also issues at the county and city level (Stockton, San Bernardino, Los Angeles). The state’s report doesn’t include this. Then again, the state’s credit rating does not apply to city, county, or municipality bond ratings. Some California municipal bonds have high ratings due to prudent local policies and revenues. Scroll to the bottom.
    http://investment-income.net/rates/municipal-califonia-bonds-rate-page

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  29. openid.aol.com/runnswim says: 29

    Hi Soquel,

    The point is that passage of Prop 30, raising taxes, was considered a highly positive step, by both the professionals who rate the credit worthiness of states and by investors who purchase the bonds. You cite a web blog for your assertion that California is the “worst managed” state. Californians have the government elected by its citizens. The propositions passed were those voted by its citizens. Some cities are better run than other cities.

    But pundits who “short” California do so at their own peril.

    California is a virtual nation-state. The state economy is about the same size as that of Italy. And it receives more than 50% of the nation’s venture capital investment. And it is the only state to have essentially ratified the Kyoto Treaty. Which will finally answer the question of the economic consequences of carbon mitigation. Stay tuned in the years ahead.

    – Larry Weisenthal/Huntington Beach CA

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  30. retire05 says: 30

    @openid.aol.com/runnswim:

    I would appreciate it if you didn’t refer to me while you are presenting your arguments. While I did, in fact, give the debt to GDP ratio using the National debt clock website, that has no bearing on what you say to others. You tried to drag Curt and Nan into your conversation, thinking they would provide you with backup. Major fail on your part.

    Kyoto treaty? Good God, man, most countries have abandoned it. And how many countries even met the Kyoto treaty goals? While the farmers of San Juaquin Valley struggle to even feed their families because Californians are too damn stupid to fight the federal EPA, you brag on the Kyoto treaty?

    You like the state you live in, Larry, and frankly, that gives me satisfaction as I know you will not be moving to mine and bringing your liberal philosophy with you. But eventually, reality is going to set in for you, and you are going to wake up someday and find your state is begging other states, via the federal government, to bail it out.

    The economics of California will not work. Time and time again, it has been proven that allowing people to keep more of what they earn generates greater revenue for states and the federal government.

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  31. @openid.aol.com/runnswim:

    Larry, again, I agree that California is richly blessed. Our fiscal demise is of our own doing. We’re blessed with geography, size, resources, and a good people. However, history has consistently proven what Benjamin Franklin said about direct democracies like California. This directly applies to Proposition 30.

    Benjamin Franklin: “When the people find that they can vote themselves money, that will herald the end of the republic.”

    In Proposition 30, Governor Brown and the Democrat-controlled California Legislature could not pass a reasonable tax hike to overcome the 2/3rds-majority requirement imposed by California’s voters as taxpayer protection. The minority opposition insisted upon actual government reforms instead of just more taxes.

    Instead, the Democrat-controlled Legislature threatened more cuts to public education to extort higher taxes. They partnered with California’s two biggest political spenders, the California Teachers Association (CTA) and the Service Employees International Union (SEIU). Both just happen to be taxpayer-funded, public-sector employee unions and major donors to Governor Brown and the California Democrats. Governor Brown and the California Legislature crafted a “soak the rich” tax scheme. They framed Proposition 30 as a simple amendment to the California Constitution, which requires a simple 50% majority to pass. They then asked just 50% of voters, who contribute less than 6% of California’s General Fund revenues and income taxes, to pass a massive new tax hike on the top 2% who ALREADY pay 50% of all California income taxes.

    To quote Franklin again, “Democracy is two wolves and a lamb voting on what to have for lunch. ” That’s why the U.S. Constitution requires states to have representative democracy, also called a republic–not a direct democracy. History proves that direct democracies don’t last long. Without significant fiscal reforms, neither with the State of California–despite our immense riches and advantages.

    As a fourth-generation native California who is witnessing the destruction of my home state, I am divesting from California and am working to limit my tax exposure. I have no problem with higher taxes it they’re spent and invested well. The way California’s government works, I’d receive more benefit by simply burning my tax dollars. At least that would provide heat and light.

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  32. openid.aol.com/runnswim says: 32

    Hi Retire,

    Time and time again, it has been proven that allowing people to keep more of what they earn generates greater revenue for states and the federal government.

    This is not correct. Even conservative economists agree that tax cuts lose money for the government. You won’t be able to find any study showing that any of the tax cuts from Reagan onward generated sufficient increased economic activity to pay for the money lost from reducing the tax rates or creating more deductions.

    With regard to quoting you — if you don’t want to be quoted in public, you shouldn’t make public statements. If you don’t want data you cite to be quoted, then don’t cite the data publicly.

    With respect to Curt and Nan, neither of them supported your assertion that it is “land use regulations” which are the cause of California’s extraordinarily high real estate prices. Neither of them contradicted my assertion that it is because the areas where everyone wants to live are overpopulated. Both Curt and Nan are died in the wool conservatives, and it is entirely understandable that they are unhappy living in a very blue state, where the Democrats in the state legislature now have the power to pass budgets over the objections of Republicans, who formerly created annual budget logjams.

    Again, worker mobility (and retiree mobility) are key components of an efficient market economy. Which is one of the reasons why it’s so important that health insurance be portable, as it will be under the Affordable Care Act. This will help to make it easier for people who want to leave California and move to Texas to do so.

    To Skook (#20):

    Larry, you mention the population bubble, I wonder if you know the ratio between new undocumented, unskilled workers and skilled, literate workers who choose to leave.

    Have you talked with primary teachers in HB? They have told me how difficult it is to teach non-English speaking kids with apathetic parents.

    I do know that the majority of the recent population growth in Texas was in so called “minority” workers.

    I personally knew a single undocumented construction and landscape worker from Mexico with a reasonably well educated daughter. I heard that the two of them relocated to Nebraska. That’s the extent of my knowledge about the above. I may try to research this in the future; it’s an interesting question.

    A good friend of mine is a secondary school teacher in bilingual education, which, by California state law, is primarily English immersion. It’s a huge challenge for the school system. 1/3 of all of California’s school kids are classified as English learners. It’s the highest of any state in the USA and it’s the primary reason our schools have become so poorly rated.

    To Soquel: Voters did not simply (and temporarily) raise income tax rates on high earners, they also voted to increase sales tax, which is a regressive tax. I don’t know what percentage of the projected revenue increases are projected to come from the income tax increase versus the sales tax increase — do you?

    P.S. to Retire05: The issue of Central Valley farmers is much more complex than you and other conservatives make it out to be. It’s not simply a fish (delta smelt) versus people. It’s really about people in the North (Sacramento delta area) who have been suffering from a slow motion drought for years, which has drastically reduced water flow in the delta. They don’t want to see the delta (important for their own local economy) drained dry and turned into a swamp.

    Political fights over water are a historical and continuing fact of life in California. Southern California’s cities want the North’s water. So do Central Valley farmers. Northern Californians are resentful about so much of their water going south, turning treasures like Mono Lake into marshland and desert. But there’s only so much water to go around. Fish-wise, it goes far beyond delta smelt to salmon and many other species. Again, it’s people (North) against people (Central and South) and not people against smelt. And it’s an additional reason why the ability of California to tolerate further growth has been exceeded.

    – Larry Weisenthal/Huntington Beach CA

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  33. retire05 says: 33

    @openid.aol.com/runnswim:

    I believe you will find that the prattle about Texas’ increase in workers was in the “minimum” wage bracket was started by a left wing blog site, Huffington Post, perhaps. It is not true. When Toyota moved from California to San Antonio, it hired 2,000 workers at a starting salary of at least $20/hr. That is hardly “minimum” wage, Larry. As other companies move to a business friendly state, they are not hiring people in at $7.25/hr.

    And perhaps when it comes to the delta smelt, and the people in the San Juaquin Valley, if you had some true leadership in California, those farms could have been saved and not destroyed other areas. But the truth of the delta smelt is that the water was ordered turned off by the feds, not by California or its politicans who seem to luguini spined to take the feds on. So you put hundreds of farmers on the unemployment list begging for help.

    You will be quick to point out that Texas has a number of illegal workers. Yet, you turn around and say that in California, 1/3 of all students are ESL candidates. That smacks of hypocracy. I can promise you, not 1/3 of all Texas students are ESL candidates.

    And do you not realize that increases in sales tax hurts the poor/elderly the most? I thought all you libs were bleating hearts. Guess not.

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  34. openid.aol.com/runnswim says: 34

    Hi Retire,

    I didn’t say that the majority of the new workers in Texas were minimum wage; I said that the majority of new Texans were members of minorities (chiefly Hispanic). To my knowledge, this is a true statement. I have no knowledge concerning what percentage of the new Texans were skilled versus minimum wage workers.

    Regarding the smelt issue, you still don’t understand the politics. Were it smelt versus farmers, I assure you that the state would have taken on the feds. But it was Northern Californians versus farmers, as I explained. If you read the following article, you’ll be better informed. You also might have a little more respect for Jerry Brown, whom none other than Art Laffer referred to as the best governor California has ever had.

    http://www.hcn.org/issues/44.14/tunneling-under-californias-bay-delta-water-wars

    With regard to 1/3 of California’s students being English learners (“ESL” in your parlance), as I stated, this is the chief reason for California’s lagging school performance (at the bottom levels, not at the AP levels, where California’s public schools continue to shine). These kids present huge challenges. It’s not simply a matter of poor teachers and poor school administration.

    With regard to the sales tax increase, you are seconding the point I was making to Soquel. California’s voters didn’t simply vote to raise taxes on the rich, they voted to raise taxes on themselves, as well. All Californians, from poor to rich. And the bond markets and bond rating agencies heartily approved.

    How about you have the last word and then let’s observe a Christmas truce?

    Have a Merry.

    – Larry Weisenthal/Huntington Beach CA

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  35. @openid.aol.com/runnswim:

    Art Laffer was referring to Jerry Brown’s first run as Governor, not his most recent. Why did Art Laffer say that Jerry Brown was “ONE of the best governors California ever had” because of his economic policies?

    Let’s use Art Laffer’s actual words to give clarity.

    * “He did a great job implementing Proposition 13″ (Democrats blame Proposition 13 for everything that could possibly go wrong in California. It was the “global warming” of its day.)

    * “put in Gann spending limit under his tenure” (the Gann spending limit is long dead in California, hence our near-record expenditures)

    * “killed the estate tax.”

    * “the first presidential candidate to campaign on getting rid of the federal income tax.”

    Art Laffer was using Jerry Brown as an illustrative example “good economics is not Republican or Democrat; not conservative and not liberal. It is economics.” Most of the feeble minds in the California Legislature have little understanding of basic economics or mathematics.

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  36. @openid.aol.com/runnswim:

    It’s interesting that you claim that Californian’s raised taxes on themselves with Proposition 30. Though technically true, it doesn’t tell the entire truth.

    * Proposition 30 raised California’s state sales tax rate, already highest in the nation, from 7.25% to 7.50%, an increase of 3.45%.

    * Proposition 30 raised California’s top income tax rates from 9.3% and 10.3% (previously, the nation’s 2nd and 4th highest) to 10.3%, 11.3%, 12.3%, and 13.3%, giving California the nation’s 1st, 2nd, 3rd, and 5th highest marginal tax rates. For top taxpayers, this increased their marginal rates between 9.7% to 24.4%.

    See this chart for clarification.
    http://2.bp.blogspot.com/-lQCIfMWfFN0/UAHSfcABo2I/AAAAAAAAA6w/VSii8e8Xgcg/s1600/Brown's+New+Tax+Hike+Percentage+Increase+by+Population.png

    So yes, a slight majority of Californian’s who pay little share of California’s total bill for government, voted to raise taxes very slightly on themselves while sticking the bill to the small minority that pays the bulk of the states tax bill. It was hardly a sacrifice for those that voted for Proposition 30, especially for the public-sector unions that bankrolled Proposition 30.

    Income taxes generate TWICE the total revenues than sales taxes in California (see Figure SUM-05 in the link below). Roughly HALF of all California income taxes are paid by just 2% of the taxpaying population, thereby subsidizing the cost of government for the other 98%.
    http://www.ebudget.ca.gov/pdf/budgetsummary/summarycharts.pdf

    You might also find one of my earlier blog posts interesting, which was written before the Proposition 30 tax hikes. It discusses tax rates, voting power, and why California is on its current path.

    Who Pays Their “Fair Share” in California?
    http://soquelbythecreek.blogspot.com/2011/10/who-pays-their-fair-share-in-california.html

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  37. openid.aol.com/runnswim says: 37

    Hi Soquel, I hope that you are enjoying the season in our beautiful state.

    Laffer did call Brown the “best governor California ever had:”

    http://orangepunch.ocregister.com/2010/11/11/art-laffer-jerry-brown-was-californias-best-governor/37346/

    I think that Brown is once again doing a superb job, considering the perfect storm of a mess he inherited. As I’ve pointed out, the bond rating agencies and bond markets appear to agree.

    Income taxes generate TWICE the total revenues than sales taxes in California

    The question that I was actually asking was, of the total increased revenues to be generated by income tax increase and sales tax increase, what is the ratio the increase to be generated by the former compared to the latter (as I write this, I don’t know). You point out that the percentage increase for the income tax increase is greater; so I suppose that this means a greater proportional increase for the income tax.

    Tax burden has to be considered with respect to wealth, as even Adam Smith conceded and Theodore Roosevelt endorsed. You apparently consider progressive taxation to be unjust. But rich people should pay more for government than do average people, because rich people benefit disproportionately from government services, compared to average people, as I’ve been arguing on this blog literally for years.

    Also, I don’t mean to be snarky, but the above is very disingenuous. Firstly, California real estate taxes are extremely low, by any standards, and especially as a percentage of real estate value. This has become increasingly true as the years go by following the passage of proposition 13 in, I believe, 1977 or thereabouts. This also goes to the prior issue of state indebtedness, as we previously discussed. As I pointed out, California has no greater government debt than does Texas, but it is distributed differently, in large measure because of Prop 13. In Texas, local government agencies (cities and counties and school boards) shoulder a greater portion of the total burden, because they have greater revenues, relative to the state.

    So you need to include all levels of state and local government and you need to include all sources of state and local revenue, lest comparisons be odious.

    For example, although high income earners pay a high percentage of income tax, they also benefit disproportionately from the low real estate taxes, in most cases.

    – Larry Weisenthal/Huntington Beach CA

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  38. retire05 says: 38

    @openid.aol.com/runnswim:

    But rich people should pay more for government than do average people, because rich people benefit disproportionately from government services compared to average people

    Are you friggin’ totally clueless? How do the wealthy benefit more proportionately, than “average” people? Are there more “rich” people using the California DMV, or more “rich” people using the California public school systems, or “rich” people access services from the Health and Human Services Department more than “average” people? Do you think that the “rich” neighborhoods place a bigger burden on the police and fire departments? Surely, you are not that brain washed.

    And what the hell, in your elitist mind, are “average people?” Are you talking about the great unwashed masses that are beneath your social elevation you being a M.D. and all? You know, those “commoners” that you say are mucking up your state by moving there? And yes, I know you never used the term “commoner” but that is how you seem to relate to people who you obviously feel are beneath you.

    What an ass you are turning into, Larry.

    And don’t presume to talk about the system of taxation in Texas. You have already proven you know little about my state and now, even less about “average” people.

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  39. openid.aol.com/runnswim says: 39

    Good grief, Retire. Why on earth can’t we simply have a civil debate about something? Anything? Just once. It would be so refreshing.

    Rich people depend on educated workers. Rich people depend upon a safe and efficient transportation system, to get their workers to their jobs and to ship their goods. They depend on police and fire protection of their offices and production facilities. Rich people depend upon transportation infrastructure: air, ocean, land, internet, satellites. They depend on basic research. They depend on public health to prevent epidemics, which would cripple both employees and consumers. They depend on environmental regulations and enforcement, which maintain clean air and water and make their communities attractive to people whom they employ and who purchase their goods and services. They depend on protection of trademarks and intellectual property through the US Patent office and court system and through international diplomacy. They depend on the legal and court system for the enforcement of contracts. They depend on weather forecasts, to plan workload and prevent shipping delays through re-routing of shipments. They depend upon regulation and protection of the financial markets. They depend up detection and prosecution and prevention of fraud. They depend upon a regulated, functional, and solvent banking system. They depend on educated customers, because education correlates with financial success and consumers with greater financial success can purchase more products and services. And so on.

    The point is that we all benefit from services provided by government, but, the higher up the financial food chain, the more the benefit of government services becomes multiplicative. There is no such thing as a self made man. Even an artist depends on having “customers” with disposable income to purchase her/his art. And government makes it possible for there to be a functioning economy for generating disposable income, through mechanisms of which a few examples are described above.

    “Average” people are, for purposes of this discussion, the broad middle class. I think that this is reasonably self-evident.

    – Larry Weisenthal/Huntington Beach CA

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  40. retire05 says: 40

    @openid.aol.com/runnswim:

    So what you are doing is basically trying to compare indirect benefits with actual dollar amount direct benefits? I could add that “rich” people put the most money into state/federal coffers to pay for those benefits, both direct, and indirect. In direct benefits, education, fire and police protection, state offices and agencies, your “rich” get much less back for their tax dollar than does your “average” people.

    Why can’t we have a simple debate? You want all the reasons? Here, try these on for size:

    you are arrogant
    you are an elitist
    you are a braggart
    you spin issues to try to fit your political philosophy
    you are a left winger who supports a Marxist based government
    you support the usurption of the 4th Amendment
    you are a cafeteria Catholic who knows nothing about the tenets of the Church or even what your own diocese is saying
    I consider you an enemy of republicanism

    Want more?

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  41. openid.aol.com/runnswim says: 41

    Hi Retire,

    I won’t offer a rejoinder to that libel, coming from a coward who hides behind a pseudonym, while attacking a real person, with a real name, a real family, a real business, and a real reputation.

    I do need to tell you that I do “understand” Church tenets, but that is different from believing each and every one of them, in my heart of hearts. I can keep my heart open and I do keep my heart open. Beliefs can and do enter, but not all at once and perhaps not every one ultimately will enter. God will judge me and the Church will decide whether or not it wants me. All I can do is to be honest, to myself, to God, and to Church. Even to you, which is why you profess (so imperfectly and I would say unfairly) to know and understand me.

    Getting back to our debate, the difference between “direct” benefits and “indirect” benefits isn’t important, when it comes to paying one’s fair share of expenses for running government. What is important is total benefit. And rich people do benefit from government much more than do poor people, in terms of financial reward. So it is right and just that they pay more taxes.

    – Larry Weisenthal/Huntington Beach CA

    ReplyReply
  42. retire05 says: 42

    @openid.aol.com/runnswim:

    You, and Richard Wheeler, are the only two on this blog site that gives their names and tells us exactly where you live. Even the owners/authors on this blog do not do that, and for good reason.

    Now, since you know that conservatives, and I am a conservative, do not resort to the dirty tricks like liberals do, you have a reasonable amount of safety in giving your name and location. Go over to HuffingtonPost (which I notice you quote a lot) or DailyKos and pretend to be a conservative, posting your name, your profession and your location, and see what happens to you.

    Now, to “understanding” Church tenents, perhaps you do, but you admit that you do not accept them, only those that lend themselves to your liberal philosphy, and frankly, I find it a bit disgusting that you would even call yourself a Catholic. When you accept God’s Church, you don’t get to pick and choose the parts you like and ignore those you don’t. And I have never claimed to “know” or “understand” you. I certainly don’t understand you (hence, my ardent dislike of you) and I most certainly do not care to “know” you.

    And you may want to claim that “rich” people benefit from taxes more than poor people, but POOR people don’t pay taxes except for local sales tax. They live in public housing, paid for by “rich” people, they get food stamps, paid for by rich people, they utilize the fire and police departments more than “rich” people, they get Medicair, paid for by “rich” people at no cost to them, they get free cell phones paid for by “rich” people along with other free utilities, all paid for by “rich” people, and if they wish to avail themselves, they get a free education paid for by “rich” people. They pay no school tax, no state or federal income tax. So how the hell you can make the claim you do is beyond me and tells me that you are either totally cluelss or, once again, making crap up to support your Marxist view of progressive taxation. No, Larry, for dollar paid in, the poor get much more back. When you pay nothing, but get thousands of dollars return every month, there is no way you can square that with what the “rich” get in return.

    You’re a hypocrite, Larry, in spades. You insult others (me, calling me a “coward” in your last post) with frequency, but whine because you think someone tweaked your nose a bit. You throw your identity out there, and then challenge people because they are smart enough not to. You never take anyone else on when it comes to that, only me. Why don’t you rail on Curt for not telling us exactly who he is and where he lives? So what if you are a “real” person. So is everyone else that joins in the coversation on this blog. Again, you assume some level of specialness, superior to us “average” people. That simply makes you an Class A Jerk.

    ReplyReply
  43. @openid.aol.com/runnswim:

    I’m fine with an income-progressive tax system to a certain extent. California’s is well beyond reason and is responsible for the massive tax revenue swings–you know, just like the one we experienced.

    Even the non-partisan California Legislative Analysts Office (LAO) singled out our overly income-progressive system as a reason for our high revenue volatility.

    Legislative Analysts’ Office
    “Revenue Volatility In California:
    HTML: http://www.lao.ca.gov/2005/rev_vol/rev_volatility_012005.htm
    PDF: http://www.lao.ca.gov/2005/rev_vol/rev_volatility_012005.pdf

    But, as with most things in California, the Legislature refuses to fix the real problems and instead creates new ones that win votes and bring in campaign contributions.

    As Will Rogers once said, “The crime of taxation is not in the taking it, it’s in the way that it’s spent.”

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  44. @openid.aol.com/runnswim:

    Larry, as you’re obviously an educated man, perhaps you can answer a question that our esteemed President and good Governor are seemingly incapable of answering. Feel to express the answer in real dollar terms or as a percentage.

    Please, explicitly define what someone’s “fair share” in taxes should be. I want to make sure that I’m paying my “fair share.” President Obama and Governor Brown have never answered the question. It’s almost as if they’re using it as political rhetoric.

    ReplyReply
  45. @openid.aol.com/runnswim:

    Larry, it you look at actual tax data from the California Franchise Tax Board (FTB) or from the Internal Revenue Service (IRS), you find that upper-income taxpayers ALREADY pay more in taxes in a variety of measures:

    * More in absolute dollars.
    * More as a share of their income.
    * More than their share of total income.
    * At a higher effective tax rate.

    Here is the latest federal income tax data (2009) with the Bush Tax Cuts in place.

    U.S. Federal Income Tax Charts
    http://soquelbythecreek.blogspot.com/2012/12/us-federal-income-tax-charts.html

    ReplyReply

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