For What Are Taxpayers Thankful in 2014?
“In this season of Thanksgiving, please don’t blame taxpayers if they are distracted by the injuries being perpetrated against them by our political class.” These words were the preface of this column at the beginning of the holiday season in 2008 and, sadly, little has changed. In fact, in many ways taxpayers are worse off now than they were then.
Six years ago, California’s tax burden was ranked 6th nationally. Today we trail only New York as the worst state for taxpayers. We now rank first in state sales tax, first in marginal income tax rates, first in gasoline tax and, even with Proposition 13, we rank in the top third in per capita property taxes. Because Proposition 13 makes it harder for California to overtake New York as our nation’s number one taxpayer hell, one can expect new efforts by Sacramento politicians to undermine its protections in the new legislative session.
Some of our state leaders like to chirp happily about California’s declining unemployment rate, but only three states are worse off and our 7.3 percent rate is much higher than the national rate of 5.8 percent. Still, all these figures are suspect because they do not count the discouraged who have stopped looking for work entirely. And even those counted include many part-time workers for whom the best holiday gift would be finding fulltime employment.
Then there is the constantly growing, and largely ignored unfunded pension liability now estimated at several hundred billion. It stood at $6.3 billion just a decade ago. As more government workers retire, this debt will come due and will have to be addressed by either reduced public services or tax increases or both. The pressure for new revenue to support the retired workforce will provide an additional incentive to politicians to demolish Proposition 13’s taxpayer protections.
Nonetheless, while elected officials may be planning to put coal in taxpayers’ stockings as we approach Christmas, there are a few things for which we can all be grateful.
First is Proposition 13, which limits annual increases in property taxes and forces the tax raisers in the Legislature to get a two-thirds vote of their colleagues to raise state taxes. We at the Howard Jarvis Taxpayers Association hear daily from those who are thankful for Proposition 13 and credit its most famous feature — limiting annual property tax increases to no more than 2 percent — for allowing them to keep their homes.
While during the session just passed, those favoring new taxes dominated the Legislature, the November election has turned out some fiscally irresponsible lawmakers and replaced them with some who understand the detrimental impact of new taxes on individual taxpayers and the overall economy, and who are likely to reject new taxes. So taxpayers are grateful not only for Proposition 13 but for lawmakers who will defend their interests against great pressure for new taxes from special interests including public employee unions.
Taxpayers are also thankful for all individuals, regardless of party affiliation, who make the personal sacrifice to run for office and present their ideas to voters. A functioning free republic relies on individuals who are willing to step into the arena, even in those instances where their chances of prevailing are small.
Finally, complaints against government at all levels are an American birthright. But we are mindful that billions of souls around the world risk imprisonment or death for speaking out against their despotic governments or leaders. So, in keeping with the season, let us be thankful that we live in a country that, despite her faults, remains the last, best hope for mankind.
Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.