Tuesday, February 07, 2006

State Tax Windfall

Tax revenues at the state level are sky-rocketing, yet governments still (always?) want more. Chris Edwards uses California as an example:

In California, Gov. Arnold Schwarzenegger has proposed a budget increase for fiscal 2007 of 8.4 percent, which follows a 9.7 percent increase in 2006. This is the same governor who, in 2003, said, "if you spend, spend, spend, then you have tax, tax, tax, but all of a sudden you say, 'Where are the jobs?' Gone, gone, gone."

In seeking reelection this year, Schwarzenegger has found a new interest in "spend, spend, spend."

Edwards continues:

The cost to California and other high-tax states of using rising revenues for added spending is that crucially needed reforms to improve tax competitiveness are not being made.

Update: More here:

California: GOP Gov. Arnold Schwarzenegger proposed a stunning increase in spending, including a record $54.3 billion for K-12 education; $170 million over two years to get health care for 300,000 uninsured children; and a big boost in funds for highway improvements. The state estimates $7 billion in higher-than-expected tax revenues over two years.

Didn't Schwarzenegger get elected on the grounds that he would help solve California's financial woes. Now it looks like he's contributing to it.