Golden state leaders expressed shock and dismay today when the State Treasury announced that income tax revenues for the last quarter had dropped to near zero in spite of a recent increase in the effective income tax rate to 100%.
"This is not possible" said a visibly shaken Governor Jerry Brown as he sunbathed under a full moon at the state capitol. "Before every one of the umpteen-odd times my administration has raised taxes, we've commissioned studies by prestigious universities on the potential effects. Each of those studies concluded people really don't care about tax rates and that quality-of-life issues, like being able to sing Kumbaya on the beach while stoned, are more important to the public. Every single one of those studies predicted revenues would go UP after we increased taxes, but every time they fell. It simply doesn't make sense - studies by prestigious universities are never wrong."
Brown said he would propose commissioning a study by a prestigious university to study the previous studies by prestigious universities.
New state treasurer and former theatrical producer Max Bialystock was particularly alarmed at the latest figures. "Our projections were for one trillion dollars in revenue this quarter and every penny of that has been allocated already: 100% for the teachers pensions, 100% for the state employees pensions, 100% for the governor's pension, etc, etc. Requiring one trillion dollars and collecting zero dollars puts us in a big hole - I don't have the exact figures in front of me but I'm sure it's a lot."
New State Treasurer Max Bialystock in Happier Times.
The totally unexpected shortfall has left state officials scrambling for answers. "We can't cut spending anymore because we've already cut to the bone" said Brown. "Any further cuts would bite into essential services, education or end up hurting the poorest of the poor and I won't have that."
"My office lavatories are stocking single-ply bathroom tissue as it is", Brown complained.
Treasurer Bialystock joked that he would consider calling some rich elderly women for dates and asked if anyone had Nancy Pelosi's number.
The state's three remaining Republicans once again proposed cancelling the yet-to-be-built high-speed rail project from Bakersfield to Fresno, a move they claimed would save the state billions. As in the past, this idea was immediately shot down from all corners as "too radical."
"Look", said Governor Brown, "we've already poured billions of dollars into the choo-choo and that money will be wasted if we don't build it. Besides, I've already promised a lot of friends free rides on the thing."
"Stupid ideas like that are the reason there are only 3 Republicans left in this state" said former governor Arnold Schwarzenegger.
The governor did say he would consider tripling ticket prices on the line as a revenue-enhancement mechanism. Legislative leaders in Sacramento immediately went to work spending the anticpated new funds expected to be generated by the higher ticket prices when the line eventually starts running.
Meanwhile, the state once again finds itself with a fiscal crisis and very few options to deal with it. Brown has already made up his mind: "We have no choice but to raise taxes again. I saw a study by a prestigious university recently that said this state could easily support a 110% income tax rate. Sooner or later we'll hit the right number and be able to raise the revenue we need."
One reporter brought up the old adage, "The definition of insanity is doing the same thing over and over again and expecting a different result."
"No", replied Brown, "that's the definition of government."
It may not work in California but President Obama promised higher taxes will work on a larger, country-wide scale.
The supposedly 'internal' actions of an individual state do indeed harm other state's ability to control their own destiny. Reason for secession #1,000,001.
HoPuff is touting the extra revenue and spending which appears designated for the public school system pre K to Womyn Studies graduate school. So the extra money will be used to make the rope with which to hang the tax revenue creators.
Max B: How much of Springtime for Hitler did we sell?"
Now about those hopey changey futures...
Quote:Today we learn the surprise $5-billion bump in revenue in January is likely an accounting anomaly as a result of tax changes.
Brown's budget office now advises in an official cash report that it is probably the latter. The report says the extra money was "likely the result of major tax law changes at the federal and state level having a significant impact in the timing of revenue receipts."
That is: Taxpayers were paying a share of their bill early, getting income off their books in the hope of limiting exposure to the tax hikes that recently kicked in.