Brown’s Ballot Measure Ignores Need for Progressive Tax Reform

by Randy Shaw on January 23, 2012

Despite the best possible voter turnout for progressive tax reform, California Governor Jerry Brown is backing a tax measure that fails to even begin a path toward this goal. It might not even successfully address the state’s short-term crisis, as the independent Legislative Analyst recently announced that Brown’s measure would bring in $2.1 billion less than projected ($6.9 v. $4.8 billion). Brown’s staff disputes the lower estimate, but even the Governor says the proposed new taxes would not eliminate the state’s budget deficit for five years. Nevertheless, many progressives and the state Democratic Party are mobilizing behind a measure that is only temporary, relies on sales tax hikes rather than a tax on millionaires, addresses none of the unfairness of Prop 13, and does nothing to build a base for future progressive tax reforms. Why is there such support for a proposal that leaves schools, parks, disabled persons, low-income families and, frankly, much of the state’s population little better off five years than today?

I understand the attraction of Jerry Brown. I was a big fan of his when he was Governor the first time, supported him in all of his presidential runs, and regularly listened to his “We the People” radio show. He is one of the most intriguing politicians of his time.

But Jerry Brown is far more fiscally conservative than California Democrats, far less supportive of school funding at all levels, and far less concerned with the needs of the state’s low-income residents. Brown is also far more supportive of the 1%. He sees their backing as necessary to win any tax reform measure, and views challenging their power as a doomed political strategy.

This is who Jerry Brown is. To his credit, he has not pretended to be anything else. He walks to his own drummer, and has not hesitated to take positions opposed by the vast majority of Democrats. A mayor of Oakland he did radio ads opposing a statewide ballot measure to reform the state’s costly three strikes law (it narrowly lost), ensuring millions of dollars went to prisons rather than Oakland schools and public services.

Brown Avoids Tax Reform

Talk to Democrats and progressives about California’s economic problems and they almost always begin by citing Prop 13, the lack of taxation on oil companies, and inadequate tax rates for the very rich. Yet in what will be a huge California voter turnout in November 2012, Governor Brown and a broad coalition are pushing a revenue measure addressing none of these systemic problems.

The reason? Brown has no faith in California voters enacting progressive measures opposed by the wealthy and corporate interests. Brown has never been an economic populist, and after forty years in elected office is not about to change

Brown gives the impression of being a long range visionary by backing high-speed rail, but his economic strategy is entirely based on the next budget year. His limited vision for the state’s economy explains why his measure only includes temporary taxes, and does not address the systemic revenue reforms necessary to return California to the heady, pre-Prop 13 days (1959-67) of his father “Pat” Brown’s administration.

Brown is betting that the state’s economy rebounds and that additional tax revenue will compensate for the shortcomings in his ballot initiative. But this bet only makes sense if Californians accept lower expectations. Brown espoused a “small is beautiful” approach during his earlier term as governor, and without tax reforms that tap additional annual revenues from oil companies and millionaires, California will not even return to the better days of a decade ago.

Brown Undermines Millionaire’s Tax

Brown’s opposition to more progressive taxation explains why his ballot measure was written so that if it wins, competing measures like the millionaires tax backed by the coalition Restoring California automatically lose.

They lose even if they get more votes than Brown’s initiative, and even though the Governor’s measure is multi-issue and the millionaires’ tax only deals with income.
I’m sure Brown has attorneys who believe that they can write such a “poison pill” ballot measure, but there is no way a court is going to favor Brown’s measure if it gets less votes than a competing one.

Brown likely inserted the poison pill because given the different topics addressed in the above two measures, they are more complementary than irreconcilable. He needed to reassure millionaires backing his measure that they would not also be hit by an additional millionaires tax, an assurance the Governor would justify as politically necessary.

Last week, the Legislative Analyst’s Office reported that the Millionaire Tax would generate $6 billion to $9.5 billion in the first year for the restoration of cuts to education, social services, public safety, and infrastructure. This is compared to $4.8 and 6.9 billion for the first year of Brown’s proposal.

The Oakland Education Association, United Educators of San Francisco, and United Teachers Los Angeles, representing over 50,000 teachers and paraprofessionals all endorsed the Millionaires Tax last week. They join such earlier supporters as the Courage Campaign, California Federation of Teachers, and Alliance of Californians for Community Empowerment (ACCE).

While many Democratic leaders have taken the easy way out by deferring to Brown, these and other groups are mobilizing behind a measure that consistently shows greater public support. The most recent poll had the millionaires tax favored by 70% and Brown’s by 62%, results that Brown’s camp expects to see change as the 1% pours millions of dollars to prevent higher taxes on millionaires.

Progressives and Democrats need to use the November 2012 both to generate new revenue and to create a building block for future tax reform measures. Brown’s measure asks voters to temporarily plug a hole in the dike; the millionaires’ tax recognizes that ending the leaks in the state’s economy requires building a more secure wall.

Randy Shaw is Editor of Beyond Chron

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