Gov. Taxing the Truth in Attacks on Angelides

Gov. Arnold Schwarzenegger must be misinformed about his reelection opponent’s tax proposals. Because if he weren’t, he’d be flat-out fibbing.

That’s the gentle way of putting it.

The misinformation, it’s logical to assume, is being fed to the governor by his campaign attack dogs, the biggest ones trained in the political kennels of President Bush.

So let’s recap, one more time, and maybe the governor will read and learn:

Treasurer Phil Angelides has been talking for many months -- too much for his own political good -- about raising taxes by $5 billion on the rich and big business.

Controller Steve Westly, Angelides’ failed opponent in the Democratic primary, totaled up all the possible tax increases the treasurer ever had mentioned over the years and accused him of proposing $10 billion in hikes. Never mind that Angelides no longer was suggesting most of those increases.

The Schwarzenegger camp picked up on the $10-billion prevarication after the primary, then early last week inflated the number to $18 billion.

In mid-week, Angelides got more specific about his tax plan and added some goodies:

* A tax cut for the middle class, small businesses and seniors totaling $1.4 billion

* A rollback in college tuitions to the pre-Schwarzenegger era, amounting to a $600-million break. Also, a $400-million increase in school spending and affordable health insurance for all kids

* Creation of a blue-ribbon commission to recommend how to raise $2 billion by closing corporate loopholes

* A long-promised hike in the top income tax rate from 9.3% to 11% -- same as it was under Govs. Pete Wilson and Ronald Reagan -- for individuals making $250,000 a year and couples earning $500,000. That rate would continue for three years, hitting the wealthiest 1% of taxpayers and generating $3.1 billion annually.

Schwarzenegger’s strategists must have thought Angelides’ plan had some voter appeal because they immediately began trashing it with distortion. (Distortion, a too-gentle word, but printable.)

And at last weekend’s Republican state convention in Los Angeles, Schwarzenegger -- waving a fist -- delivered this balderdash to cheering delegates:

“Our opponent wants to raise your taxes by at least $18 billion. He wants to tax virtually everyone, everywhere. He wants to increase the car tax, the sales tax, the property tax, the farm equipment tax, the income tax, the alcohol tax, and he even wants to tax you when you go and get a tune-up for your car. Our opponent has never met a tax he doesn’t like or a tax he won’t hike.

“His message to us is more taxes. Well, here’s our message to him: We say no to more taxes. No to more government spending. No to more government control.”

Dissecting this political perjury: Angelides clearly is not advocating an increase in the car tax, the sales tax, the property tax or the liquor tax -- or imposition of a new tune-up tax. He is leaving open the possibility of repealing the five-year-old sales tax exemption on farm equipment, depending on the recommendations of his loophole-closing commission. And his only income tax hike would be on the likes of himself and Schwarzenegger.

As for government spending, it has risen 26% under Schwarzenegger. And his pledge of no more government control? He’d better stop trying to negotiate legislation to curb greenhouse gas emissions.

How do Schwarzenegger’s spinners come up with an $18-billion Angelides tax hike? With bizarre contortions.

They add up all of Angelides’ promises -- some now moot, invalid or irrelevant -- exaggerate a few costs and arrive at a total funding figure that allegedly will require an $18-billion tax increase.

The biggest, most absurd calculation is that a proposal to require employers to provide health insurance for workers amounts to a $7-billion tax increase. First, that figure is based on a different, much more expensive bill sponsored by former state Senate leader John Burton (D-San Francisco) that voters repealed.

Second, it would be a mandated cost on employers -- not a tax. It would be no more a tax than the minimum-wage hike that Schwarzenegger is about to sign.

Some pundits have criticized Angelides for not specifying which corporate loopholes he’d close.

I pressed him on that.

“There are 46 profitable corporations doing business in California with $1 billion or more in revenues that pay no corporate income tax,” he said. “I don’t think that’s right.

“I don’t think it’s right that 18 corporations can set up phony mail boxes in Bermuda, the Bahama Islands or Cayman Islands and escape state taxes. But the tax code is like a Swiss cheese, a privilege for those who have lobbyists and accountants who crawl the halls of the Capitol.”

Angelides is plenty specific for a political campaign. Let’s be honest, most people’s eyes glaze over on the details anyway.

Many will argue that we shouldn’t be concerned about a little truth-bending in politics. What’s another fabrication, more or less, even if it does increase public cynicism and voter dropouts? After all, Schwarzenegger is just a politician trying to win.

But he could make the same point by telling the truth and sparing his credibility. Just say: My opponent promises to raise taxes. I promise not to, because I think it would drive business and jobs out of state.

Finally, readers who think this column favors Angelides and sticks it to Schwarzenegger should think again. Almost any discussion of a tax increase -- whatever size -- tends to help the governor and hurt his tax-crusading challenger.

But the discussion should be based on facts, not fibs.

George Skelton writes Monday and Thursday. Reach him at george.skelton@latimes.com.