Schwarzenegger Wants to Pump You Dry

Being a Republican Governor in a Democrat state is a tough job. So much so that any “reaching across the isle” (read: capitulating to the Dems in Congress) will be thrown back in your face by the party and disqualify you from running (successfully) for President.

It’s no small feat that Republicans helmed the trifecta of big time Democrat states: New York, Massachusetts, and California. And all three of those men have had their names thrown into discussion to be President: Giuliani, Romney, and Schwarzenegger.

Schwarzenegger, of course, would require a revision of the constitution and so far such talk is more a mental exercise than a groundswell of demand. The appeal of these men is precisely what alienates them from the core of the party: their ability to prioritize what conservative issues they are firm on and what issues need to be moderate on to survive in a purple state with a deeply blue congress. (And when did the pinko commies in this country shrug off their Red color. That’s media revisionist history at its best. The Left has been Red here and abroad for decades and decades).

It’s no coincidence that the issues these men are most likely to express freedom from the party platform on are issues of freedom itself. Social freedoms. Libertarians like me are pleased with these developments despite such “flip-flops” being poisonous to “the base.”

But it’s even more dangerous when these flexible Republicans also choose to be loose with the fiscal rules of the party, especially taxation. Going Dem on spending has gotten the entire party thrown out of nearly every office they could have been thrown out of, but the criticism has been the oblique “failed Bush economic policies.”

This is Democrat code speak for “spending like Democrats and taxing like Republicans” but the failure isn’t the tax policy, it’s the spending.

That’s why it’s troubling that Arnold Schwarzenegger wants to solve California’s bankruptcy problem (caused by the excessive size of the CA government and the excessive size of the entitlement budget) with another play from the Democrat playbook: TAX HIKES.

Arnold used to understand:

“From the time they get up in the morning and flush the toilet, they’re taxed. Then they go and get the cup of coffee, they’re taxed….This goes on all day long. Tax, tax, tax.”

– Governor Arnold Schwarzenegger

But now, he wants to hike the CA Sales Tax by 30% and apply that tax to “luxury” services like furniture repair, vehicle repair, golf, and VETERINARIAN SERVICES. You read that right, prepare for a 6.5% increase in your vet bills with no benefit to you or your dog to pay for California’s attempt at a socialist Utopian welfare state.

A Revenue Problem: While Governor Schwarzenegger has worked to fix the state’s spending problem, and has kept state spending relatively flat for the past three budget cycles, the dramatic drop in our revenue projections over the past six weeks presents an extraordinary situation which, combined with the volatility of our tax system, creates a revenue problem. Raising taxes is never a good idea, but in this extraordinary situation, there is no question that new revenues must be brought into the state to protect education and vital services. The Governor is proposing $ 4.7billion in new revenues for the current budget year in the form of:

A Temporary Sales Tax Increase: A temporary increase in the state sales tax (from 5 percent to 6.5 percent) will generate additional sales tax revenues of $ 3.5 billion in 2008-09 for the General Fund. It will also effectively protect significant education funding. At the end of three years, the state sales tax would revert to 5 percent.

Broadening the Sales and Use Tax to Include Certain Services: Effective February 1, 2009, the sales and use tax rate will be applied to appliance and furniture repair, vehicle repair, golf, and veterinarian services. Effective March 1, 2009, the sales and use tax rate will be applied to amusement parks and sporting events. This is expected to generate additional General Fund sales tax revenue of $357 million in 2008-09.

… plus an Oil Severance Tax and an increase in Alcohol and Excise taxes.

The incredible stupidity of this move is reflected in the types of services Arnie is targeting for the increased tax. Appliance, Furniture, and vehicle repair are services that responsible cost cutting, belt tightening citizens are going to seek more of in this time of recession. You fix your old stuff instead of springing for new stuff.

Taxing and thus placing disincentives on this industry and the people who are apt to use it is harmfully hostile to already suffering people. These industries are already on the ropes due to California’s throw away mentality and the tech boom followed by the Real Estate boom (where people bought brand new cars and furniture and threw the old stuff away instead of repairing it).

Such businesses hope to stay alive for the tough times where they make their bread and butter and now that those times are here, it’s a horrible idea to tax them more. Such counter-cyclical businesses are one of the only hopes to turn the economy around: they hire people when others are firing, they pay taxes on profits when others are showing losses, and they turn recessions into prosperity.

Taxing golf is a wonderful idea. Golf is a luxury and it’s not a vital industry in any sense of the term and the type of people who are still paying for tee times now are highly unlikely to give up or cut back on the luxury with a tax increase; i.e. I suspect that there is an inelastic demand curve for golf in CA. I also hate CA golfers for stealing Colorado’s water to green up their links while our lawns and agriculture suffers.

But the worst element of all is a tax on veterinary services. Vets are already cocky bastards who are offering ever more pricey services, many akin to those available for humans, without the need to pay huge rates for malpractice (your dog is just property after all). Getting in and out of a Vets office for less than $100 is becoming more and more rare, and now Arnie wants you to leave the state a 6.5% tip every time you do.

The cost of veterinary services is already outstripping inflation, and pet owners are getting hit with increased maintenance costs for their pets.

In England, where the inflation in Vet prices has been 12% per year while general inflation is only 4.4%, over One and a half million pets were put down in the last five years because owners are no longer able to pay for vet services. Adding 6.5% to the already inflated and expensive cost of Vet care in California will certainly lead to poorer compliance (which leads to increased animal suffering) and perhaps the same trend that is happening in England.

The good Dr. Khuly has been all over the issue recently, noting how expensive it is to feed our pets, how expensive it is to medicate our pets, what the recession means for vet care, and why this tax plan is a bad idea.

Gina over on Pet Connection also points out that the lumping of vet services in with golf, cars, and chairs shows a serious disconnect between viewing pets as family and viewing pets as taxable property.

The bleeding heart and iron fisted group which backed the stupid California Healthy Pets Act is also leading the charge against this tax initiative. While I certainly don’t think this measure is going to lead to the filling of animal shelters with innumerable pets that are suddenly too expensive to care for like the Social Compassion In Legislation group does, it will no doubt have a negative impact on pet health in the state where owners are already dumping pets in increased numbers.

“In California, over 800,000 dogs and cats already enter our shelter systems every year, and more than half are killed because there are not enough homes,” added Mancuso. “This year, most shelters are reporting a 20-30 percent increase in those numbers and up to a 200 percent increase in large animals. This is one tax we absolutely cannot afford.”

After the sizable appropriate backlash against SCIL and the Healthy Pets Act, SCIL backed out of their support like rats fleeing a sinking ship with an anemic and self-serving excuse:

In the last few days, Assembly Member Levine amended AB 1634 to mandate a discounted microchipping program, thus jeopardizing an existing revenue stream for local governments. The amended bill would also have required a complicated new animal licensing structure.

Our coalition, along with our co-sponsor the California Animal Control Directors’ Association, could not wholeheartedly support this last set of amendments, since they strayed too far from the bill’s original purpose and would have resulted in less money for our shelters. Lacking our full support, AB 1634 was brought to the Senate floor this morning but did not pass out of the Senate.

What a load of bologna! Not only is the discounted microchipping program a poor diversion, it’s also a joke that the driving force against the appropriate failure of AB 1634 is SCIL pulling out. HAH! How about the bill was a horrible ham fisted and guaranteed to be ineffective pile of crap that the vast vast majority of the animal loving community easily saw through and rallied against is the reason the bill failed in committee.

SCIL is trying to save face with their claims of victory (making “history” by elevating the issue of “pet overpopulation”) when what they’ve really done is discredit themselves and the cause with their core tactic of ham-handed governmental interference in issues government should stay out of.

SCIL and Governor Schwarzenegger both fail for the same reason: they believe that it is acceptable to betray essential freedoms and common sense solutions when their own desire for power to control others outweighs the moral cause they represent. They’ll lie and call such betrayals “necessary compromise” or even “pragmatic” actions, but they’re not.

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About Christopher

Christopher Landauer is a fifth generation Colorado native and second generation Border Collie enthusiast. Border Collies have been the Landauer family dogs since the 1960s and Christopher got his first one as a toddler. He began his own modest breeding program with the purchase of Dublin and Celeste in 2006 and currently shares his home with their children Mercury and Gemma as well. His interest in genetics began in AP Chemistry and AP Biology and was honed at Stanford University.