California Sliding Into Sea of Economic Insolvency

Some folks around the social orbit our editorial staff just don’t have a clue what economic mischief is afoot at the “Bill Mill” so I thought I would break it down for the slow learners. If you are a low information voter or a 90-Day Calendar Guy, this includes you.

Prop 13

Proposition 13 has been a protection on property taxes for Californians since Jerry Brown was governor the first time. If you have no clue who Rose Bird is then it was implemented was before your time. No one serving in the Legislature is old enough to remember the world before Prop 13 was enacted thus they have no idea what an economic benefit this has been to California businesses and homeowners.

Reasons for Prop 13

The holy grail of many Liberals in this state is to dismantle the protections afforded by this ballot proposition. The most logical way is to bifurcate the law by separating business from residential property. Most interpretations of this arbitrary split result in rental property ending-up in the business bucket. Give our “housing crisis”, all this will do is result in even more upward pressure on rental prices. Having businesses and residential property taxed at different rates is only the first step in scrapping Prop 13. At some point, residential folks will get stripped of their protections too.

Prop 13 allows max property tax increase of two percent per year

Rent Control

Using the “housing crisis”, California voters will be given another opportunity to enact rent control in 2020. Again, if this ballot measure does not implement a statewide rent control program like the one just implemented in Oregon, it will be a big step in that direction. I think rent control is likely to pass next time. If not, it will keep showing up on the ballot until it does. Look for the ballot title and summary to be the Affordable Housing Act of 2020 or something similarly deceptive.

2017 graphic–before Oregon enacted rent control

Sales Tax

Many services are currently exempt from charging sales tax. Since the Board of Equalization has been gutted, I see a path cleared to changing the law to get rid of most protections and subjecting virtually everyone and everything (except diapers and tampons) to sales taxes. Thus your haircut, car repair, tax preparation, attorney, etc. will cost you even more.


The above will all be sold on the basis of class warfare to economically illiterate people—mostly public school graduates—as a punishment on “the wealthy” because they believe that people can only get wealthy by screwing the “little guy”.

Ultimately, these issues will not be decided on what is best for you but on whether the Democrats are happy with the revenue stream going to Sacramento. This is allegedly a time of surplus revenue but I have my doubts. We know the long-term prognosis is bad but whether the folks at the Capitol have a clue… Oh, please don’t pin your hopes on that.

Anyway, the words quoted by H.L. Richardson keep flowing thru my mind, “But look what we let them keep”. Let’s hope the legislature keeps their hands out of our pockets but I don’t think they can help themselves.