Ballot Measures - The Budget Propositions: 30 and 38, 34, 36 and 39

Okay, I figured I would give a quick rundown of my take on the various ballot propositions.  This post focuses on the ones that have budget implications: 30 and 38, 34, 36 and 39.

Propositions 30 and 38
I don't really like either of these, but I am reluctantly supporting both of them.  Proposition 30 is Jerry Brown's proposal to raise income taxes and sales taxes to support education and to help balance the budget.  Proposition 38 is Molly Munger's proposal to raise income taxes to support education.

On the down side, I don't like sales taxes - like or not, we have a largely consumer-based economy, so putting a tax on the main driver of the economy seems to be counterproductive.  It also tends to be regressive, as lower-income people spend a much higher proportion of their income and wealth than do wealthy people.  

While I am sort of okay with income taxes, I would prefer a heavier reliance on resource extraction taxes (you pay to take oil or water or timber) and toxics taxes (you pay to make or sell or use carcinogens, respiratory irritants, and other poisons), along with limiting Proposition 13 protections to a primary residence.  (If a business model, such as real estate development or commercial leasing, depends upon and assumes increasing property values, but the taxes on that property do not reflect those same increasing property values, you have a subsidy.)  Car taxes also are a reasonable way to ensure that those who impose costs (air and water pollution, road building and maintenance) help pay for them.

That said, California needs more revenue.  On a per capita basis, our government (believe it or not) is relatively lean.  Physical infrastructure and education are investments in our future, not costs to be minimized.  I do believe in cutting costs (more on that later), but we cannot cut our way out of our current hole.  So I will vote for these two measures.

Why both? Because I want to show that Californians understand the need for more revenue.  If they both fail - for whatever reason or reasons - the conventional spin will be that California is opposed to taxes, and really wants to just cut things.  The result would severely damage California and its economy to an extent I don't think people fully realize.

Proposition 34
This would end the death penalty in California, and replace it in life in prison without possibility of parole.  This is a great idea, and would save lots of money that is now wasted - we spend millions of dollars every year paying lawyers to argue if some criminal already in prison should be killed or not.

We should spend our money catching and prosecuting the criminals out of the street, not the ones already locked up.  And besides, the state should not be in the business of killing people.  The arguments I made during my campaign for attorney general can be found here: http://www.peterallenforag.com/main/page_crime.html

Anyway, the death penalty is a ridiculously wasteful and unnecessary money sink, and should be eliminated.  Yes on 34.

Proposition 36
This proposition would soften California's "three strikes" law that currently requires stiff sentences (like life in prison) for a third criminal conviction.  Proposition 36 would alter that law so that a life sentence would only be imposed when the third conviction is serious or violent.  This would be a step in reducing the huge size of the prison population and its corresponding cost.

It is not clear how much it would save, but we can use any savings right now, and this seems to take a reasonable approach.  So I am voting yes on 36.

Proposition 39
Proposition 39 would eliminate a recently-created tax loophole that allows out-of-state corporations doing significant business in California to evade paying California taxes.  That same loophole also discourages them from opening facilities in California.  So 39 would fix this nonsensical arrangement, and potentially bring in an additional $1 billion per year, without raising taxes on Californians.  So far, so good.

Here is an L.A. Times piece that describes the issue: http://articles.latimes.com/2012/oct/10/local/la-me-cap-prop39-20121011

But 39 then goes on to earmark half of the money for energy efficiency and alternative energy projects by creating a new fund, with its own oversight board.  While energy efficiency and alternative energy are good, I have concerns about yet another budget-by-ballot measure that prevents us from spending the money on something that turns out to be a more urgent priority, and I also don't think we need to create a new government program and entity now.

So I am leaning slightly toward yes, since the tax loophole is really big and stupid and problematic, and it is not clear whether the legislature can get its act together to fix the problem.  If you think the legislature will be able to fix it, then voting no on 39 makes sense.

More on other races soon!