[quote=harvey][quote=CA renter]For the record, California’s high income tax rate, high fees, etc. are the result of Prop 13. The state lost billions in revenues when Prop 13 passed, so they had to make it up elsewhere.[/quote]
California’s overall (property, income, sales) tax rate is high relative to other states.
Prop 13 may have created a short-term need for cities to compensate with other taxes. That was 40 years ago.
But today California’s overall property tax rates are not even very low (just below the average of other states.)
The Prop 13 debate has nothing to do with the simple fact that California, in general, has high taxation.
And it has even less to do with the fact that the state has long history of taking on debt and unfunded obligations.[/quote]
California’s overall tax rates are somewhat higher than other states — it’s around tenth place (depending on year).
After the passage of Prop 13, revenues dropped by approximately 60%. By capping the annual increases at 2% (well below the level of property price appreciation in this state), the reduction in revenue was made permanent. By requiring a two-thirds vote for any additional local “special taxes,” Prop 13 prevented local governments from being able to make up for the shortfall in property taxes by imposing new local taxes. Again, these changes created a permanent shortfall in tax revenues, relative to population size and public spending levels; it was not a short-term issue at all.
As for the argument that we have high taxes because of debt and unfunded obligations (a claim you’ve made without any data to back it up), we need to look at where our money actually goes, and why some of these spending categories are so high.
The majority of our spending goes toward K-12 Education (~42%), Health and Human Services (~29%), Higher Education (~11%), and Corrections and Rehabilitation (~9%).
Approximately 12.3% of our K-12 students are children of illegal immigrants. This percentage is likely underestimated because schools are not allowed to ask families about their immigration status.
These groups (poor and illegal immigrants, along with their children) place a disproportionate burden on our state’s schools, healthcare system, and legal/prison system — exactly where most of our money is going.
Our state is “wealthy” only because a relatively small percentage of our population receives a disproportionate share of our country’s total personal income. There is very little left of our middle class, and what is left is just hanging by a thread.
Pensions are not the cause of our state and local governments’ financial problems (and one could argue that the reduction in staffing that would result from fixing our immigration system and tighening up our welfare system would drastically reduce our pension costs without affecing our revenues by much).
For some perspective, you should take a look at our budget to see where our money goes. The issue is complex; and while those who would greatly benefit from the decimation of public employee unions want to direct the focus on pensions, it’s obvious that pensions are not the main cause of our financial problems.
What’s interesting is that these pretend “taxpayer advocates” never talk about all of the other taxpayer guarantees, unearned tax subsidies, and public expenditures, etc. that are draining this state (and our country) of public money and resources. This just covers a relatively small slice of these expenditures:
