Eliminating Tax Subsidies & Failed Enterprise Zone Program Should Be Sacramento’s First Priority

Higher than expected tax receipts have set off a new debate in Sacramento about what to do with the new monies.
   California Governor Jerry Brown said that he wants to stabilize public education funding and repay past borrowing.
   Meanwhile, Democrats in the state assembly recently voted to restore $440 million to child care programs that help low-income families find work.
   Although the new tax receipts have effectively cut the state’s current budget deficit in half, Governor Brown should not devote one penny from this unexpected windfall toward propping up the state’s failed enterprise zone program, which funnels precious taxpayer dollars into the pockets of private businesses through wasteful tax subsidies.
   Instead, the governor should move to eliminate the enterprise zone program, end the practice of paying private contractors to do jobs that civil servants can perform for half the cost, and repeal the tax breaks given to multinational corporations in exchange for passage of the 2009 state budget.
   These moves would immediately save taxpayers about $39 billion dollars and enable Sacramento to shore up many of those health and human service programs that were cut to the bone over the last several years.
   According to the California Budget Project, programs to assist seniors and the disabled along with those that help low-income families transition from welfare to work and the state’s children health insurance program have experienced more than $8 billion worth of budget cuts since 2008.
   These cuts were imposed on top of previous cuts that were prompted by ballooning budget deficits incurred under Arnold Schwarzenegger.
   In fact, California’s budget deficit actually grew by $81 billion under Schwarzenegger’s watch.
   With unemployment at 10% nationally and 12% in California alone, the consensus is that government can and should do more to help those who have lost their jobs and homes.
   The only way this can be done is by reinvesting in our public services and institutions.
   Unfortunately, California has a structural budget deficit that can only be erased through an approach that includes finding revenues over the short term and creating new revenues sources over the long term.
   Governor Brown’s common sense proposal to close the state’s remaining budget deficit by extending existing sales, car, and income taxes to maintain existing revenues will keep California solvent in the short term.
   Over the long term, a more permanent solution could be reached by enacting the changes mentioned above.
   While we’re in the process of cleaning up the fraud and abuse associated with converting our tax dollars into tax subsidies, we should also institute a surcharge on financial service transactions like stock trades to make sure that Wall Street bears the cost of cleaning up this economic mess they’ve made.
   For several years now, the American Federation of State, County and Municipal Employees (AFSCME) has called on our elected leaders to hold town halls and budget hearings at the county level, so that all Californians can have a chance to participate in the decisions that will affect their future.
   Fortunately, the legislature and governor have begun to heed this advice, and voters now seem to realize that California needs a fair tax system to fund the state’s future, as recent polls in March and April found substantial support for Governor Brown’s revenues-based approach (58%) and for raising the personal income taxes of individuals making $500,000 or more (78%).
   We should take advantage of this opportunity to bring change to the entire system by wiping out the waste and abuse of our taxpayer dollars.