Jerry Brown, California, and taxes

I live in California where every election year there’s something new on the ballot to hate. This year we owe our ballot loathing to Governor Jerry Brown. A recent Wall Street Journal article highlights the depressing details.

He recently agreed to adjust his November ballot initiative to include an even higher top tax rate. Previously he favored an increase to 12.3% from 10.3% today. But the government-unions that live off tax revenues had threatened to sponsor their own ballot measure raising the top rate even higher. To make sure there weren’t competing ballot measures, he and the unions agreed to back only one initiative with a top rate of 13.3%. Oh, by the way, the measure would also raise the state sales tax by a quarter of a percentage point to 7.5%, or more than 9% including the sales tax in some cities. One final reason to hate this is its duration—it will be in place seven years.

All of this is said to be necessary to balance a $9.2 billion budget deficit. Mr. Brown expects about $9 billion in added revenue, up from $7 billion in his first package. But the state Legislative Analyst's Office has already told Mr. Brown that he's crazy to think he can get that much money from a corner of the taxpayer base.

The top 1% in California pay between one third and half of all state income tax revenues, depending on the condition of the economy. California already has the fourth highest income tax in the nation, behind Hawaii and Oregon at 11% and New York City at nearly 13%. The national average for the top income tax rate is under 6%. Nine states have no income tax.

Of course, the cry is heard that this is the only way to get more money out of taxpayers. But consider an enlightening example. One of the last states to have a tax rate as high as California is proposing was Delaware in the 1970s. Its rate hit 19.8%. Then-Governor Pete du Pont cut the rate to 10.3% in 1979 and later to 5.95%. How did that turn out? Lefties would guess that all the revenues dried up. Not true. After five years the state's revenues had nearly doubled and its credit rating went from the worst to one of the best.

Now, this will be ignored by Brown and his fellow Dems. Why? Because the tax increase is simply about the political power to deliver money to the interests that live off government. But what will happen when the monies aren’t as forthcoming as the liberals hope? You guessed it . . . They'll raise taxes again—and again, and . . . .

I hold out hope that at some time the voters will wake up and realize this can’t go on. But who knows out here in the bizarre state of leftist California.