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Tax the Rich: How Budget Woes Rolled Downhill

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Give the state legislative Republicans credit.

The caucus remained unified throughout the drawn- out budget process and beat back the Democratic majority's efforts to continue the temporary tax increases as a solution to the state's budget crisis.

But that's yesterday's news.

Today's news is that the crisis didn't go away. Instead it has shifted down to cities and counties.

With a lean budget, the legislature has drastically reduced payments to local governments for medical programs, transportation assistance, police and fire protection, parks and libraries, and the panoply of vital social services.

Now local governments are in the bind of their lives and some are striking back -- with proposed tax increases.

San Francisco seems to be the role model.

With sales taxes cut by one percent statewide, Mayor Ed Lee is asking voters to support a half- percent tax increase in the November election.

The $60 million raised would be used to cover rising costs for law enforcement, firefighters, and public health and social programs--the core services provided by any local government.

The additional tax will become law if two-thirds of the voters approve the proposal.

In one sense, Lee has proposed a win-win situation. The half cent sales tax addition will still mean a half cent savings for taxpayers as well as the continuation of important programs and services.

No doubt, other local governments will follow, hoping to recoup some of the money no longer tendered by the state.

In another sense, the pushing off of tax issues may be the first step in further distinguishing the qualities and capabilities of one local jurisdiction from another.

Affluent and educated communities are likely to be much more supportive of such proposals, while poor, less educated communities may not.

This kind of separation will add to the perception that slowly but surely, we are becoming two Californias.

The more that the state distributes funds, the more likely that all local governments will have similar social services foundations and capabilities.

To the extent that state support declines, it will become a system of every local government for itself.

That may be just fine for folks who live in rich pockets, but not so good for the rest of us.

Related Topics Tax, Sales Tax, California, Budget Cuts
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