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Tammy Messina: Lack of jobs not state’s only problem

Posted: December 28, 2012 2:00 a.m.
Updated: December 28, 2012 2:00 a.m.

 

Just a couple of weeks ago, our California state senators and assemblymen were sworn into office for the upcoming year. I doubt many people tuned in to see that event. It happens during the week in the middle of the workday. Our elected representatives take the oath of office, and there a few votes taken to set up the leadership structure. And, of course, there are a few speeches.

As I was listening to Senate President pro Tem Darrell Steinberg, he said: “The only sustained way to grow a tax base in this state and in this country, is to create more high-wage jobs.”

Really?

This from the party intent on raising taxes (or removing tax breaks and loop-holes) on the high-income earners. How, exactly, does a fully Democratic-controlled state expect to attract businesses who have these high-salary jobs?

I listened for specifics as to how Sen. Steinberg planned to create these “high-paying jobs”. But there were no specifics.

Let’s say, for a moment, that our Legislature can actually create high-paying jobs. Why would a person with such a salary be willing to stay in California? Certainly those high-paying jobs exist in other states with less of a tax burden. What would make that highly paid person want to stay in California? The friendly folks, weather and beautiful sunsets probably aren’t enough incentive.

And then there’s the highly paid person’s employer. What would make the employer want to stay in California (assuming you were able to attract him here in the first place)? As an employer, pretty much whatever taxes the employee has to pay, the employer also has to pay. Businesses survive by maximizing their bottom line. Setting up shop in California where they can pay one of the highest tax rates in the nation is not a good business strategy from any vantage point that I can see.

Remember, Sen. Steinberg did mention increasing tax revenues without specifically mentioning the need to raise taxes, so let’s assume for a moment that that is the plan. Increase tax revenue without raising taxes. As of mid-year 2012, TaxFoundation.org ranks California as the state with the highest sales tax burden in the country. I still don’t see any incentives that would attract anyone — business or individual — to move to California. Am I missing something?

If we’re going to survive as a state, we have to get serious about how our finances are handled at the state level. It’s a vicious circle. Our cost of living is so high because our taxes are so high. Government has to tax us more because they have to pay people more because the cost of living is so high and the taxes are so high. We’re spiraling out of control.

Cuts are going to be painful, but they’re going to have to happen. We don’t have enough revenue to pay our current obligations and sustain existing programs. People and businesses are leaving in droves (continually declining tax revenues). And I’m still looking for incentives to attract people to stay in California (other than being upside-down on your home mortgage). It’s doubtful we’ll convince anyone to come at this point.

Does anyone have any creative, viable solutions to the California fiscal nightmare we’ve created that don’t involve cuts to existing programs? I just don’t see any way around them.

Tammy Messina is a resident of Santa Clarita, a local business owner, and a producer for The Real Side Radio Show. She can be reached at tammy@therealside.com.

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