Too true.
Won't help, but might be of interest:
HOW THE GOLDEN STATE GOT TARNISHED
By Harold Meyerson
To understand why the woes of California's economy threaten the nation's, we must understand the state's road to insolvency. The Age of Reagan did not commence with the Great Communicator's inauguration in 1981. For its real beginning, we need to go back to June 1978, when Californians went to the polls and enacted Proposition 13.
By passing Howard Jarvis's malign initiative, California voters reduced the Golden State to baser metal. Under Republican Gov. Earl Warren and Democratic Gov. Pat Brown, California epitomized the postwar American dream. Its public schools, from kindergarten through Berkeley and UCLA, were the nation's finest; its roads and aqueducts the most efficient at moving cars and water -- the state's lifeblood -- to their destinations. All this was funded by some of the nation's highest taxes, which fell in good measure on the state's flourishing banks and corporations.
Amid the inflation of the late 1970s, however, the California model began to crumple. As incomes and property values rose, Sacramento's tax revenue soared -- but the parsimonious Democratic governor, Jerry Brown, neither spent those funds nor rebated them. With the state sitting on a $5 billion surplus, frustrated Californians grumped to the polls and passed Proposition 13, which rolled back and then froze property taxes -- effectively destroying the funding base of local governments and school districts, which thereafter depended largely on Sacramento for their revenue. Ranked fifth among the states in per-pupil spending during the 1950s and '60s, California sank to Mississippi-like levels -- the mid-40s -- by the 1990s.
Since 1978, state and local government in California has been funded chiefly by personal income taxes. Bank and corporation taxes have been steadily reduced. In the current recession, with state unemployment at 11 percent, tax revenue has fallen off a cliff.
But the problem with Proposition 13 wasn't merely that it reduced revenue. It also made it very difficult to increase revenue. Raising taxes now requires a two-thirds vote of the legislature, though in 47 other states a simple majority suffices. California has become overwhelmingly Democratic in the past two decades, but Republicans have managed to retain footholds -- representing just over one-third of the districts -- in both houses of the legislature.
(Continued...)
