Writing in 2007, Los Angeles Times editorial writer Robert Greene stated, the defining issue of the 2003 recall was Gov. Gray Davis’ tripling of the car tax, more officially known as the vehicle license fee. The defining issue of Arnold Schwarzenegger’s successful campaign to unseat Davis was his promised rollback of the said car tax.” Greene went on to document the relationship of the car tax, the gas tax and the diversion of this revenue from transportation infrastructure to shore up a chronically unbalanced state budget. The contortions and machinations by state officials behind this diversion of funds was difficult to follow. What was not difficult to follow, however, was the public’s disdain for the car tax, a fact to which former Gov. Davis will attest.
The transportation tax package just approved by the California Legislature — greased with ample amounts of pork — is a lot more than just an increase in the car registration tax. It also imposes a 12-cents-per-gallon gas tax, and will cost the average California family of four over $250 annually. If state politicians wanted to inflame California taxpayers, they couldn’t have picked a better way to do it. What’s next? Standing in Capitol Park to poke hornets’ nests?
The current proposal, calculated to cost California drivers $52 billion over the next 10 years, is bad for innumerable policy reasons. But it’s also bad politics.
Gov. Brown and the legislative leadership secured the necessary two-thirds vote in each house to pass the tax package by buying off a handful of legislators via promises for specific transportation projects in their districts. (The two-thirds vote requirement for tax hikes at the state level is a lesser-known benefit of the iconic Proposition 13, enacted in 1978. But with a Legislature dominated by tax-and-spend liberals, the supermajority threshold was met.)
For those legislators who cast a yes vote for this damaging tax hike, it will be interesting to see how they explain this to their middle-class constituents. During the Gray Davis recall effort, the backlash against the car tax increase was intense. Who can forget “Hasta la vista, Davis?” And, speaking of unforgettable, when massive tax increases were proposed in 2009 in the middle of a debilitating recession, unruly mobs were marching in the street shouting “heads on a stick.” The tax hikes just approved are much larger than what Gray pushed. Moreover, they are permanent tax hikes with no sunset, and would be constantly adjusted upward for inflation.
While the two-thirds vote threshold to jam this tax was breached, it did provide an important benefit. Specifically, it helped to reveal the clearest line of demarcation between those who stand with the middle class and those who stand with special interests and big spenders. Had the vote threshold been simple majority, progressive legislative leadership could have “protected” their most vulnerable members by allowing them to vote against the hikes to give the impression that they were fiscally responsible. This is called “lifeboating” by Sacramento political insiders.
But with the supermajority requirement, and the final vote tally so narrow, the ability of leadership to protect vulnerable members is limited. While Democrats in solid-blue coastal districts — think San Francisco or Santa Monica — fear no serious consequences for voting for tax hikes, the same cannot be said for legislators in swing districts. For them, the vote for the largest transportation tax in history will surely be used as a bludgeon by their political opponents.
Just ask Gray Davis.
Jon Coupal, president, Howard Jarvis Taxpayers Association