The lesson of California - Page 4

ANNIVERSARY SPECIAL: The Golden State that invented the tax revolt is failing, but the conservative movement presses on
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Image by Tom Tomorrow

The campaign against Prop. 13 warned of the dangers of cutting local government; police and fire chiefs appeared in ads opposing it. But the No on 13 folks never talked about the huge windfall big corporations would get from the measure, or the huge disparities in wealth that would be created by defunding government and dereguutf8g corporations.

If the goal was to skew the concentration of wealth in the state, it worked brilliantly. According to the California Budget Project (CBP) of the Franchise Tax Board, recent data taken before the current economic recession illustrates an ever-widening chasm between the wealthiest taxpayer and the working-class person.

The total adjusted personal income for Californians rose by nearly $64 billion in 2006-07 — with approximately three-quarters of that increase going to the top fifth of wealthiest taxpayers, and 30 percent going to the top 1 percent. That left only $19 billion for everyone else.

"The average taxpayer in the top 1 percent experienced a $128,261 increase in AGI [adjusted gross income] between 2006 and 2007, which was more than three times the total AGI of the average middle-income taxpayer in 2007 ($36,115)," stated the June 2009 report.

This continues a long-term trend in which the wealthy continue to leave the average income-earner behind in a trail of dollar-sign dust. From 1995 to 2007, income gains for that top 1 percent come to a whopping 117.3 percent increase — nearly 13 times more than the gains of the middle-income taxpayer.

The nation's income gap has reached a "level higher than any other since 1917," according to a paper by University of California, Berkeley economic professor Emmanuel Saez. According to Saez's analysis of census data, there's been a steady increase in the income gap since the 1970s, rising 20 percent over the years.

Yet even today, the defenders of Prop. 13 continue to sound the same consistent themes. "Those who are directly involved in government are a militant special interest," Howard Jarvis Taxpayer Association executive director Kris Vosburgh told us. "They don't like anything that limits their revenue stream."

While that last statement could be applied equally to corporations or other private sector enterprises, as Vosburgh reluctantly admitted when asked, he continues to imply malevolence to those who defend government. He said the state's current fiscal collapse can only be solved by slashing government expenditures.

"It is not valid to be talking about revenue-side solutions," he said. "Our position is the state has enough money to accomplish its goals."

People have never liked paying taxes, but the antitax movement is about far more than just that basic individual desire to hold onto our money.

The attacks were well planned, carefully targeted, and part of a much larger effort aimed at maintaining corporate and conservative power, undermining the New Deal, reducing taxes on the rich, and radically reducing the size and scope of the public sector.

As Powell called for, corporations have aggressively challenged, in legal courts and those of public opinion, every significant progressive advance — from San Francisco's attempt at universal health care to California's tentative first steps to address global warming.

With a level of discipline unheard of on the left, conservative opinion-shapers pound their talking points and enforce party unity through mechanisms like the "no new taxes" pledge that every Republican in the California Legislature has signed and heeded, under the very real threat of recall.

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