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GOP Digs State In Deeper

Legislature's hard-line foes of all tax hikes endanger California.

June 06, 2003

Putting hardball politics above fiscal rationality, state Senate GOP leader Jim Brulte has turned budget negotiations into a hostage-taking. Brulte told fellow Republicans on Wednesday that he would use his considerable personal clout to defeat them in next year's primary if any of them agreed to even a modest temporary tax increase to help fix the budget crisis.

One GOP member called Brulte's move "brazen intimidation." Republicans are in the minority in the Senate and Assembly, but some GOP votes are needed to pass a budget, which requires two-thirds approval.

With less than four weeks before the June 30 budget deadline, final talks on closing a budget gap of up to $38 billion could grind to a halt. A frustrated Assembly Speaker Herb Wesson (D-Culver City) says there can be no negotiation when one side refuses to consider a critical part of the solution. Democrats have certainly not been angels, declining to make all the cuts that are clearly necessary. But at least they acknowledge that every tool is needed to get the state out of its hole.

California is about to finish the 2002-03 fiscal year with a deficit of $11 billion. Democratic Gov. Gray Davis wants to finance that with a temporary half-cent increase in the sales tax, paying off the indebtedness over five years. Davis' package also includes a 1% boost in the highest income bracket for the wealthiest Californians and a cigarette tax increase. An additional $4 billion would come from an automatic restoration of cuts in the vehicle license fee, triggered by declining tax revenues.

Cuts would total about $12 billion. This is similar to the mix approved 10 years ago by then-Gov. Pete Wilson, a Republican, to weather the last budget crisis. But today, Republicans insist on cuts alone, claiming that any tax boost will drive business from California. Surveys conducted in the early 1990s showed this did not occur. On the other hand, crumbling schools, transportation systems, public health care and other critical services would certainly look bad to business.

No matter how bad his poll numbers are and no matter how worrisome the GOP effort to recall him might be, Davis should be barnstorming the state telling voters graphically what effect such massive cuts would have on the state. Business and industrial leaders should be by his side.

In other states facing fiscal crises, Republicans are approving both program cuts and tax hikes, however reluctantly. If Brulte and his allies are serious about their Molotov-cocktail approach to budgeting, they risk handing a bankrupt state to the courts and financial markets to run. Some victory.

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