Skip to comments.Despite Tax Increase, California State Revenues in Freefall
Posted on 12/08/2012 7:47:45 AM PST by lowbridge
California State Controller John Chiang has announced that total state revenue for the month of November 2012 fell $806.8 million, or 10.8%, below budget.
Democrats thought they could hammer the rich by convincing voters to pass Proposition 30 to create the highest state income tax in the nation. But it now appears that high income earners have already voted with their feet by moving themselves and their businesses out of state, resulting in over $1 billion shortfall in corporate and income taxes last month and the beginning of a new financial crisis.
Passage of Proposition 30 set off euphoria and expectations of higher spending for public employees. The California Teachers Association (CTA) trumpeted: California students and working families won a clear victory today as voters clearly demonstrated their willingness to invest in our public schools and colleges and also rejected a deceptive ballot measure aimed at silencing educators, other workers and their unions.
State bureaucrats immediately ramped up deficit spending far beyond the states $6 billion annual tax increase,with the Departments of Health Services and Developmental Services increasing this months spending by over $1 billion versus last year. The lower tax collection and higher spending drove the States deficit after the tax increase to $2.7 billion for the first 5 months of this fiscal year.
(Excerpt) Read more at gopthedailydose.com ...
I was talking to a director of a major California company. They have operations worldwide but are heavily California-centric. He said theyd convened the corporate planning team the day after the election. He also said that they earlier had moved a major program from LA to Tennessee. They offered a move package but expected few people to take it. They were stunned to find that everybody took it.
He said that most likely the company would begin moving more and more projects to other states and not replace their California staffs as they retired or were laid off.
They can get behind the Detroit City Council in demanding that Obama bail them out as a quid pro quo for their votes. That will be quite a line.
I liked this line from above article.
there was welcome news that a business had committed to opening in the State. Executives of the 99 Cents Only Stores Inc. proclaimed they would be opening a new location in Beverly Hills on formerly posh Rodeo Drive.
“... resulting in over $1 billion shortfall in corporate and income taxes last month and the beginning of a new financial crisis.”
I mean....who woulda guessed???
Take note zero and reid and all you silly dumbles.
You too Boehner...stand and FIGHT! You have proof: what they want doesn’t WORK!
The ones that you mentioned know exactly what they are doing. And why they are oing it. They are only trying to fool the idiots into thinking they care about them.
Filed as “No Shit Sherlock”.
“The roaches that infested California in the Sixties, Seventies and Eighties are now finishing the job of burning (my home) state to the ground before they all colonize Oregon and Washington and other states to begin the process anew. (Yes, I know its already well underway in those states and in others).”
Everything you say is so true! And Brown has been in the thick of it throughout his miserable Marxist life. It even goes back to his worthless father Edmund G. (Pat) Brown. The man who brought us ugly freeways to nowhere, and gassed the “student protests” at Berkeley with a helicopter. If it haddn’t been for Ronald Reagan’s terms between the two of them, California would have been finished a decade ago. I only hope that this state goes over the fiscal cliff with Brown at the helm. It will be a fitting end for him (and his party). Oh, and let’s not forget to give him “credit” for how Oakland is today. LIke his governorships, being mayor of Oakland achieved the same results. Like FUBO, this jerk has never had a real job.
Sadly, I have to agree....the financial cliff is their windfall and they want it.
“You can’t fix stupid.”
Sure you can,the problem is that the ways to do that are all illegal at the present time.
If CW2 comes,then fixing stupid will be a top priority.
Neither Kalifonia nor the federal government gets it. I happily left that Socialist Republic more than a decade ago when Gray Davis was busy driving it into the ground. Wish it were as easy to escape the heal of the feds.
They’ll keep pushing the tax button until the whole thing collapses around them.
That's also called the point of diminishing returns.
That's what I get for posting before coffee.
The point where revenues start to drop, because prices are just too high - THAT is the point of diminishing returns. To optimise income, pricing (tax) should be set right before that point.
At least there’s no income tax in WA. It’s been soundly beaten every time it’s been brought up for a vote, despite the best attempts of the left to use class warfare as a means of passing it.
Some version of Directive 10-289 to prevent the “rich” from leaving their punitive tax state coming soon !
It's all politics. Reality, and its consequences, just doesn't figure into their lust of power. After all, they will get theirs. To heck with common sense.
To wit, in Congress, the CBO can't use dynamics, such as the Laffer Curve, to give a more realistic estimate of the impact of tax policy.
The old story of a TX US Rep (economics prof, Dem turned Pubbie, iirc, name escapes), asked the CBO what the revenue of 100% tax rate would be.
The answer was the expected income of all US taxpayers without any effects of the punitive, and disincentivizing tax rate.
Let’s not forget to give due credit to Arnie. He did even more than Gray Davis to push California over the cliff, and he also ensured the return of Jerry Brown.
And, regretably, we owe the installation of Arnie to Bush and Rove and company, who moved in and “fixed” the California Republican party.
Ah, but do they bring their pernicious voting habits with them?
I guess the so callled “rich” don’t want to be “eaten” afterall and are leaving CA by the hundreds of thousands. CA can rot and fall into the Pacific... It won’t be missed.
A credible source pretending to be a reporter on a blog would provide their last name.