Today a new radio spot hit the radio waves of the 4th Congressional District, highlighting Sen. McClintock’s strong stand against any new taxes in Sacramento and Washington DC. Charlie on the other hand has already urged Sen. McClintock to vote for a state budget with a one-cent sales tax increase and proposed an $18 billion increase in energy taxes.
Listen to “Fighting Taxes” Now:
Download Audio
Sen. McClintock spoke on the floor of the State Senate in opposition to the Democrats’ unbalanced version of the state budget which included a 1 cent sales tax increase, August 29, 2008.
Mr. President:
Last year, when some in this chamber assured us that the budget was not only balanced, but included the biggest budget reserve in the state’s history, others of us issued an urgent warning that the budget was dangerously unbalanced and that we were fast running out of the time needed to implement reforms.
The State Controller reports that during last year we received $96 billion in revenues – a new record — but spent $107 billion. And now we’re running out of money.
I am concerned that conventional budget reductions alone will no longer bridge the fiscal gap without severely impacting delivery of vital services.
We have centralized and unionized and bureaucratized our service delivery systems to the point they can no longer adequately perform the basic tasks for which they were designed.
Simply stated, we have created a bureaucracy we cannot afford.
We cannot afford spending 1/3 of a million dollars per classroom when only a fraction of that actually trickles into the classroom to educate our kids.
We cannot afford spending $42,000 to house a prisoner when Florida does it for $18,000 and the federal government for $26,000.
We are going to have to clear away the massive bureaucracy in our public schools that does nothing to educate our children and instead put teachers back in charge of their classrooms, put principals back in charge of their teachers – including the authority to hire and fire — and put parents back in charge of their principals through their local school boards.
We are going to have to rescind the sweetheart labor contracts in our prisons, restoring management authority to the wardens and contracting out at least 50,000 prison beds.
We are going to have to replace the massive bureaucracy in our health system with a simple prepaid refundable tax credit to bring within the reach of every family a basic health plan of their selection.
This is the only way we are going to be able to maintain vital services without bankrupting the state. But if the consensus does not exist to enact conventional budget reductions, it certainly doesn’t exist to enact a fundamental restructuring.
During my 22 years in this legislature, I and others have laid out all these proposals, but they have fallen on deaf ears. There is some bitter irony in the fact that those who have voted against these proposals year after year accuse Republicans of not offering alternatives when that is all we have done year after year. But at some point very soon, these reforms, or others like them, will have to be enacted.
Senator Ducheny tells us that the budget before us is a baseline budget; that it merely continues business as usual. The problem is that business as usual produced $11 billion of red ink and we cannot afford to do so again.
Nor can I agree that the path to fiscal recovery is through taking the highest sales tax in the nation and raising it still higher with the second biggest tax increase in the state’s history. In that respect, I agree with Barak Obama who last night said: “In an economy like this, the last thing we should do is raise taxes on the middle-class.” And yet that’s the first thing this budget does.
I was here in 1991, and I warn you that raising the sales tax did not improve our finances – it made them worse.
The census bureau reports that in the last two years, a half million more people have moved out of California than have moved in. The historic migration FROM Oklahoma and Arkansas TO California in the 1930’s has now reversed itself in an historic outmigration of Californians TO those states with lower taxes and vastly less burdensome regulations (including Oklahoma and Arkansas). The difference is that the dust-bowl migration was caused by an act of God – the new migration is caused by acts of government – OUR government.
Those acts are fully within our power to reverse – but that will mean reversing the policies that have wrecked the once Golden State of California.
I would conclude with an observation on process. It is good that for the first time since the budget deadline we finally have a formal budget proposal on the Senate floor to begin deliberations. But it is unfortunate that this did not arrive on our floor in May. And it should have stayed on this floor day after day until it cleared the 27 votes needed to send it to a conference committee.
So I would ask those of you who voted to send an empty budget bill directly to the conference committee earlier this year to contemplate the damage that was done by bypassing the entire legislative process. And I would express the hope that the next session of the Senate finally return to the traditions and procedures that served this state so well for many, many decades and that produced relatively balanced and relatively punctual state budgets.
Sen. McClintock delivered this speech to the Nevada County Republican Central Committee Barbecue in Grass Valley, California, August 23, 2008
A funny thing is happening on the way to the Obama coronation. Americans are waking up and asking some basic questions, like:
Does anyone seriously believe our health care is going to be improved by handing it over to the same people who run the DMV and the Post Office?
Does anyone seriously believe that a House leadership that places William Jefferson on the Homeland Security Committee after he was caught with $90,000 in bribe money in his freezer has the best interests of our nation at heart?
Does anyone seriously believe that socialism will work any better in America than it did in the Soviet Union?
Nobody here does – and fewer and fewer people across the country do either as they begin taking a closer look.
And once they began asking those questions, the political tide began turning in our favor. Just since the energy debate began in Washington last month, the Rasmussen poll has tracked a five point shift toward Congressional Republicans. Last week, John McCain pulled even with Obama for the first time in the Gallup poll.
Another thing is happening: Americans are awakening to the fact that the Luddite Left of the Democratic Party has been blocking development of America’s vast energy resources and we’ve had enough.
Last month, my friend Charlie Brown announced that he was marching in lock step with Nancy Pelosi by opposing opening the 97 percent of our offshore and 94 percent of our onshore land that is currently off-limits to American oil production. At a time when our families are struggling to afford a tank of gas, we have more than 800 billion barrels of American oil under American land that is off-limits to American production. That’s three time the known petroleum in Saudi Arabia and enough oil to meet American needs for the next century.
But that’s just part of the damage they’ve done to American energy independence. We Californians are already paying the highest electricity rates in the continental United States – and the utilities have just filed for another rate increase.
The cleanest and cheapest possible way to produce electricity is from our dams. Hydroelectricity costs about 1 1/2 cents per kilowatt-hour (compared to 28-cents for solar energy). At 1 ½ cents per kilowatt-hour, your average household electricity bill should come to about $90 – per year.
Meanwhile, water rationing now threatens our region although we have the most abundant water resources in the nation.
And yet, a short distance from here is the site of the Auburn Dam. The footing was carved for that dam more than 30 years ago, but it was suspended because of opposition from people like Charlie Brown.
The Auburn Dam would generate 800 megawatts of the cleanest and cheapest electricity on the planet – enough for nearly a million families. And it would conserve 2.3 million acre feet of water – enough for more than two million families. And all this at a time when we can’t guarantee enough electricity to keep your air conditioner running or enough water to keep your lawn green.
And yet Charlie Brown has vowed to block the development of this vital local resource that promises both cheap electricity and abundant water for the people of this region.
Ronald Reagan was right: Government is not the solution to these problems – government has been the cause of these problems.
And this week Charlie Brown sent out an e-mail to supporters demanding that I vote for the state budget. Ladies and gentlemen, that state budget contains the second biggest tax increase in the history of California. It will cost an average family some $550 of additional taxes at a time when they’re struggling to pay their electricity bill, their gasoline bill and a tax burden that is already one of the highest in the nation.
That shouldn’t surprise us. Charlie has already proposed an $18 billion tax increase on oil companies. There’s only one problem with that. Oil companies don’t pay oil company taxes. WE CONSUMERS pay oil company taxes as they pass them along to us as higher prices.
An $18 billion tax increase at the federal level is nearly $200 of additional taxes an average family will pay at the pump.
So it should also come as no surprise that Charlie refuses to take the “No Tax Pledge” to protect the people of the 4th Congressional District from the massive tax increases that the Pelosi Congress is already preparing to unleash.
They have refused to make the Bush tax cuts permanent – and they have refused to repeal the Alternative Minimum Tax. And it is important to understand that their refusal to do so makes those tax increases automatic. If they just sit there and do nothing those tax increases will take effect. They are already set in motion.
That’s why the election is so important. That’s why the no tax pledge is so important. And that’s why Charlie Brown’s insistence on passing a budget with the second biggest tax increase in the history of California is so appalling – and why it’s important to understand what it would do to our economy.
The current state budget proposal that he demands be passed includes more than $5 billion of new taxes that will boost California’s sales tax to nearly 10 percent.
The last time we did this was in 1991, when Pete Wilson increased the California sales tax to almost 9 percent.
The first thing that happened is that retail sales in California fell faster in the next quarter than they had fallen in the previous thirty years. Remember that 2/3 of economic growth depends on consumer spending – and a sales tax strikes at the heart of our economy.
And that’s exactly the next thing that happened. The tax increases of 1991 sent California into an economic nose-dive. The new taxes produced only a fraction of the new revenue that had been promised, and then produced two consecutive years of billion-dollar-a-year declines in state revenues as our economy imploded.
And that was at a time when the rest of the country was heading into an economic boom – imagine the damage that will be done to our economy at a time when the nation’s economy is faltering and our own unemployment rate is running frighteningly ahead of the national unemployment rate!
At least people can escape bad energy and tax policy in Sacramento by moving out of California. Where can we go to escape bad energy and tax policy in Washington D.C.?
So here is my response to Charlie Brown: Sorry, Charlie, I will not raise taxes. I will not raise taxes in California. I will not raise taxes in Washington D.C. I will not raise taxes, period. And that is something the people of this district can take to the bank.
A year ago, Sam Aanestad and I and several other Senate Republicans warned that the state budget was dangerously out of balance and that we were running out of time to fix it. We offered billions of dollars of spending reductions that would have prevented this fiscal meltdown. Where was Charlie Brown then? I know where his fellow Democrats were: they were crisscrossing the state assuring everyone that the budget was not only balanced but included the biggest budget reserve in the state’s history!
Here’s the good news: Americans are paying attention and they understand what’s at stake. And I’m not just talking about Republicans. Our voter ID calls in this Congressional race now indicate that we’re bringing in one in five Democrats who reject the Pelosi-Brown obstructionism on energy and who don’t share their exuberance for higher taxes.
I am confident that this district is now poised to send a clear and powerful message to Nancy Pelosi and her minions just 73 days from now: We want our country back. We want our Constitution back. We want our freedom back. We want our energy independence back. We have had it with your high taxes, your bloated bureaucracies, your empty promises and your endless obstruction of every attempt by American enterprise to restore American abundance and prosperity.
Ladies and gentlemen, what has happened to our country has happened on our generation’s watch, and it is our generation’s responsibility – and our generation’s destiny — to set things right.
And when history looks back upon this period, I believe it will record that just when it looked like our American rights might be consumed by the bureaucratic state, this generation of Americans rose to the defense of our liberties and when we were done, we had produced a new era of American freedom, prosperity and energy independence and abundance for generations to come.