The wrong people pay for Schwarzenegger's busted budget
The state's wealthiest residents would make out just fine under his plan to cut services, hike taxes.
The Schwarzenegger administration, which was launched via an electoral campaign of majestic hypocrisy in 2003, has finally fulfilled all the heady promise of those distant days of the Gray Davis recall.
Just a few days after being featured on "60 Minutes" talking about his commitment to "what is best for the people of California," he sneaked his sixth annual budget plan into the public spotlight on New Year's Eve. Of course, nobody would be too distracted by merrymaking and alcohol to realize that he's out to sock it to the middle class and the working class again. ("I'm a public servant," he reassured the man from "60 Minutes.")
The governor himself was not on hand for the unveiling, having hared off to a ski vacation in Idaho. (Aren't there any ski resorts in California?)
The man who coasted into office by railing against his predecessor's borrowing plans proposes to meet a looming $40-billion budget deficit by borrowing $10.3 billion. He also wants to slash K-12 and community college programs to save $5 billion. Cut grants for the disabled, aged and poor to save $2.5 billion. Hack away at medical care for the needy and slice home health workers to minimum wage.
"These are very deep cuts to education and health and human services," Jean Ross, executive director of the nonprofit California Budget Project, told me this week, unfortunately sounding like a broken record.
The state's wealthiest residents would make out just fine under the budget plan. (Unless you think that having to pay sales tax on golf fees for the first time is an unholy burden.)
But the not-so-wealthy? Consider his proposed cut in the income tax credit for dependents, which is designed to generate $1.4 billion in savings. My back-of-the-envelope calculation says this change will lower the income level at which many California families of four start owing state income tax to about $33,000 from $49,000. That will affect more than 825,000 households, judging by 2005 figures from the state Franchise Tax Board.
It's not as if these Californians have been getting away with something by not paying state income tax. They're people who already get disproportionately socked by Schwarzenegger's budget-balancing -- his policies of fewer parks, higher fees, less money for schools and colleges. Now he's also proposing a 1.5-cent-on-the-dollar hike in the regressive sales tax, which will strike harder at this same cohort. And if they're sending their children to community college or Cal State, they'll pay more for tuition, if those staggering systems still have student places available.
