Gov. Jerry Brown sat down with the San Jose Mercury News editorial board today to discuss his ballot proposition to raise taxes for education. If the measure fails, automatic trigger cuts will mean billions cut from K-12, community colleges and public universities in California.
Brown started off with some political history — a little bit of ‘how did we get into this mess — for the assembled Mercury News reporters and editors.
“If you go back to Pete Wilson,” Brown began, “we had a big recession, he had to cut massively and raise taxes massively. And then Davis rode up the high tech bubble and rode it down. That created its own problems and then Arnold came in and he rode the mortgage bubble up and also rode it down. And so that we are caught in waves of prosperity and misfortune. And in that process, the problem has been compounded because the Democrats and Republicans as they try to negotiate a balance, the Democrats want to get some more benefits and the Republicans counter with tax breaks. That then compounds the problem, because you have more spending and less revenue.”
Which brings us to the present and a $16 billion budget shortfall Brown had to balance, just this year. He came up with Prop. 30 which raises taxes on people earning more than $250,000 each year and raises the sales tax by .25 percent. The income tax expires in seven years, and the sales tax lasts four years.
Brown believes a tax was the only way to close the budget hole.
“Instead of the tax, we could have cut, but we’ve already cut a huge amount,” the governor insisted. “We’ve cut 25 percent from higher education. We’re cutting our prisons back, substantially, 30-40,000 people who used to go to prison aren’t going there any more. We cut the money that you give the pensions for blind, the disabled, and the aged — from $850 a month to $835 — cut 15 bucks from some of the poorest people. … If people say, ‘You know what? You haven’t cut enough,’ then we’ll cut another 6 billion; half a billion in higher education, 4, 5-hundred million from community colleges, and over 4 and a half billion K-12,” the governor said, alluding to the trigger cuts if his proposition doesn’t pass. “So that’s it,” he finished off, ”It’s a choice and it’s arithmetic.”
Barbara Marshall, the editorial page editor of the Merc. could barely get her folllow up question started before Brown interrupted.
“Some critics feel as though you’ve skewed the trigger cuts to education to increase pressure to pass … ” Marshall started off.
“And that’s absolutely untrue!” Brown said, “This is the only place left.” He went on to detail still more cuts the state has already enacted — to In-Home Supportive Services, moving children from Healthy Families to Medi-Cal (“no one likes that,” he said), fewer fish and game wardens, his list went on.
The problem with relying on income tax from high earners is that the revenue stream is volatile. Brown acknowledged that the volatility is an issue, but again turned to history to make his case.
“I like to compare the way it was to the way it is,” Brown said. “The way it was — when I was governor the first time — the top 1 percent, 1.5 percent, the top income earners garnered about 8 percent of the collective income of California. Now they take in 22 percent. So you go from 8 to 22. Anyone below that is contributing to their enhanced well being. … So then to ask those who have been most blessed and most fortunate to give back one or two or three percent, from an equity point of view, from a fairness point of view, I’ll even say from a Christian point of view, is perfectly appropriate. From a volatility point of view, yeah the up and down is not what I would like it to, but then what could we do. We couldn’t have a tax then. It’s this or it’s probably nothing.