Soundings

Steven Greenhut
Think Long Comes Up Short
A new report calls for higher taxes in California.
Winter 2012

California’s ongoing budgetary and political dysfunction has spawned a host of reformers backed by wealthy donors. The latest scheme, released with much fanfare in late November, is a report produced by the Think Long Committee for California and funded by billionaire Nicolas Berggruen. It’s called A Blueprint to Renew California, and it leaves much to be desired.

Most of Think Long’s proposals—the creation of a “citizens’ accountability committee,” additional spending on infrastructure and education, streamlining the environmental-permitting process—are window dressing for the main one: a $10 billion tax increase, imposed through a ballot initiative that would go before voters in 2012. And then, after it gets voters to sign off on the tax hike, the committee (like many in California’s majority party) wants to rein in the voter-initiative process. Berggruen and Think Long believe that the key to renewing California is to raise taxes on almost all Californians. Their plan would make the state’s tax code less progressive by trimming the corporate tax rate and imposing a new sales tax on services. The goal: to provide still more revenue to a state government that’s already bloated and wasteful.

Think Long released its utterly conventional recommendations with a burst of self-congratulation: “At a time when political leaders in both Sacramento and Washington seem hopelessly mired in gridlock, the committee has shown that difficult bipartisan compromise can be reached if politics is set aside and the public interest is put first.” These words might be more persuasive if Think Long weren’t composed of so many politicians who wielded power during the period when California’s budgetary problems became unmanageable. The committee’s members include former governor Gray Davis, bounced from office in the 2003 recall election; former assembly speakers Bob Hertzberg of Los Angeles and Willie Brown of San Francisco; and former state supreme court chief justice Ron George. Other advisors include former governor Arnold Schwarzenegger, current lieutenant governor Gavin Newsom, and Los Angeles mayor Antonio Villaraigosa. Most of these are poster children for what’s wrong with California; they are an unlikely group of saviors.

The report ignores the Golden State’s real problems: excessive government spending and dominance by public-sector unions and other special interests. The closest that Think Long comes to acknowledging them is three perfunctory paragraphs at the report’s end, which cite the pension crisis crushing municipal governments and offer this solution: “We recommend that the governor, legislature and local government officials make it the highest priority to work with public employee unions to find ways to address the long-term costs of pensions and the unfunded liabilities that have already been built up.” That’s as far as it goes.

Nothing in the report comes close to articulating major reforms that would help the state stretch its dollars. For instance, the nonpartisan Legislative Analyst’s Office recently reported that the cost of incarcerating inmates in California has more than doubled over the past decade, the result not only of court decisions regarding inmates’ health care but also of escalating compensation costs for correctional officers. A braver committee would have considered prison privatization or constraining the influence of the noxious California Correctional Peace Officers’ Association, which resists even modest reforms and holds outsize influence over both parties.

Even soft-pedaling, Think Long provoked the ire of the California Teachers Association. The CTA resents the committee’s proposal to junk Proposition 98—which directs 40 percent of the state’s budget to education from kindergarten through community college—even though the report goes on to propose an extra $5 billion for the schools from other sources.

Every would-be reformer knows that something is wrong with California’s budget and political process. But most have tended to be left of center and have offered ceremonial, symbolic reforms that don’t get to the heart of the state’s problems. Think Long is the latest example, and its “blueprint,” like the work of its many predecessors, is likely to be soon forgotten.

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