Thursday, May 22, 2008



  • A majority of surveyed voters (56%) thought that tax hikes should be part of any budget solution, along with spending cuts.
  • The Legislature's marks are downright pathetic: 26% approve, 57% disapprove.
  • Not surprisingly, 67% of voters think California is headed in the wrong direction.


George Skelton

George Skelton: Capitol Journal From the Los Angeles Times


May 22 2008 — SACRAMENTO — Californians seem willing to be talked into accepting a tax increase to help balance the books in Sacramento.

But that will require political leadership, and currently voters don't detect much emanating from the state capital. People are pretty disgusted with the politicians.

"The public is not very impressed with the kind of money management taking place in Sacramento," says Mark Baldassare, president and pollster of the nonpartisan Public Policy Institute of California. "Here we are back with the same kind of mess we started with four years ago."

That was shortly after Arnold Schwarzenegger got elected governor vowing to "end the crazy deficit spending."

He and legislators now are peering into a projected deficit hole of $15.2 billion for the fiscal year that starts July 1.

Baldassare released a new statewide survey today showing, the pollster says, that "voters are divided along party lines just like the Legislature that represents them."

It also shows voters to be conflicted and confused.

Last week, Schwarzenegger revised his $144-billion budget proposal and offered as its centerpiece a scheme to borrow against future lottery profits.

The lottery would be modernized and expanded. Wall Street investors would pay the state $5 billion a year for three years and get back at least $38 billion -- principal and interest -- over 30 years from the presumably enhanced lottery take.

If legislators and voters didn't like that idea, or if the revenue fell short of erasing the deficit, the governor offered a backup: Raise the sales tax by 1 cent on the dollar for up to three years.

Voters surveyed by Baldassare could stomach the sales tax hike a lot better than borrowing off the lottery.

Asked their view of Schwarzenegger's lottery-borrowing plan, 62% opposed it. How'd they feel about Plan B: raising the sales tax? That was favored by 57%, including a slim majority of Republicans.

"It's about as close as you can get to a consensus -- 57%," says Baldassare, "given how negative people are about the direction of the state and the leadership of the governor and Legislature."

A majority of surveyed voters (56%) thought that tax hikes should be part of any budget solution, along with spending cuts.

But for the most part, the public is polarized on taxes. By nearly 2 to 1, Democrats believe that "tax increases should be included in the governor's budget plan." Republicans disagree by the same ratio.

Dig into the data and you find confusion and confliction.

Once again, the public says it wants government services, but doesn't want to pay for them, at least personally. It thinks someone else should pay.
Asked about raising taxes on corporations, 62% were all for it. And 64% favored socking it to "the wealthiest Californians." Never mind that the top 5% of income earners already are paying 68% of the income tax.

When asked once more about raising the sales tax -- this time in the context of choosing between it and taxes paid by corporations and the rich -- 57% were opposed.

Voters (63%) also didn't like the idea of extending the sales tax to items "such as legal and accounting services, auto repairs and haircuts."
At the same time, 76% expressed concern about the governor's proposed deep cuts in health and welfare programs. Mostly, however, voters wanted to protect K-12 education.

Schwarzenegger did largely protect school funding in his revised budget. Yet, 57% of voters said they were "dissatisfied" with the governor's plan.
That probably, to some degree, is a reflection of the deteriorating Schwarzenegger brand name. Fewer people now approve of the governor's job performance than disapprove: 41% to 51%. His approval has slipped nine points since January.

The Legislature's marks are downright pathetic: 26% approve, 57% disapprove.

Not surprisingly, 67% of voters think California is headed in the wrong direction.

Clearly, to sell voters -- let alone Republican legislators -- on a tax increase, Schwarzenegger needs to employ all his marketing skills. But he isn't.

In fact, he now seems to be disowning the sales tax boost that he suggested only last week.

Lobbying for his proposed reform of the budgeting process before a friendly Coronado crowd Monday, Schwarzenegger didn't mention the sales tax. In fact, he regressed to his old rhetoric: "I'm against raising taxes, and I always promised the people of California I will not raise taxes."
But he did concede, without using the T-word, that "the only way you can solve [the deficit] is two ways: cuts and raising revenues. And this is why we have a combination in our budget."

And he also warned, referring to legislators of both parties: "If they all stick to their principles and if they all stick to their ideology, this state will go off the cliff."

The lottery as a revenue source is tempting for many legislators, even if the plan does smack of more gimmickry and another expansion of gambling in California. At least it would save cuts in healthcare and reduce the need for tax hikes.

Nonpartisan Legislative Analyst Elizabeth G. Hill endorsed the concept Monday while suggesting a scaled-down version.

But veteran Sen. Michael Machado (D-Linden), chairman of a Senate budget subcommittee, echoes some of the eye-rolling opposition: "There are a lot of ways to balance the budget besides relying on alcohol, tobacco and gambling. If we're going to do that, we might as well tax prostitution."
Sen. Darrell Steinberg (D-Sacramento), the designated next Senate leader, suggests raising the sales tax and using the cash to pay off debt. Maybe Republicans will go for that, he says hopefully.

"Everyone agrees that the federal government's huge amount of borrowing is a drag on the national economy," Steinberg says. "Well, the same can be said for the state economy."

Californians will listen and can be sold. But there needs to be a credible salesman who believes in the product. From Sacramento, that must be the governor.

Skelton: California voters could be swayed on tax hike, poll finds - Los Angeles Times

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