Let’s talk taxes

Karen Bass (D-Los Angeles) will be sworn in as Assembly speaker today.

For all its wealth and resources, California is a giant in crisis.

In preparation for my new job as speaker of the Assembly, I have talked to dozens of Californians who are feeling that crisis. I have conferred with business leaders in the Silicon Valley who are relocating overseas. I’ve met with farmers in the Central Valley who cannot afford to plant crops, which results in the abandonment of the workforce in nearby small towns. I have talked with teachers and school board members in San Diego and Norwalk, where teachers received layoff notices. I have met with students who will be saddled with oppressive debt as soon as they finish college.

All this in a state with resources beyond the dreams of many nations: Silicon Valley leads the world in software and semiconductors; more than 50,000 companies export products around the globe; our ports handle almost $285 billion worth of goods every year. This state provides a home to almost one-third of the biotechnology firms in the United States, a $94-billion tourism industry and about 80,000 farms and ranches producing more than $30 billion worth of goods.

With so much worth protecting and so much that threatens our economic well-being, it is far past time to move beyond simply patching over budget problems to finding a real, creative -- and bipartisan -- way off the budget roller coaster we seem to be stuck on year after year after year.


On Wednesday, one day after I take office as speaker, Gov. Arnold Schwarzenegger will unveil his revised budget. It will reflect the state’s revenue picture after the April 15 income tax deadline. By all accounts, it will not be good news. The word “disaster” has been mentioned.

When there is a disaster such as an earthquake, a fire or a flood, political leaders put their ideologies aside and ask, “What can we do to alleviate the pain?” We must respond to the current economic crisis in the same way. We have to toss aside the boxes we have put ourselves in and the labels we place on others and get the job done together.

I believe part of that job has to involve looking at the big picture. We have to ask the question of whether a tax structure that was established in the 1930s is sufficient to meet the needs of Californians in 2008.

I believe we need an answer to that question that is developed outside the day-to-day give-and-take in the Legislature. That’s why I will be establishing an independent commission to examine California’s tax structure. This will be a bipartisan group of California’s brightest, working together for one year to develop recommendations on how the Legislature can identify more consistent sources of revenue; 12 other states already have such groups.


The one-year term means that while the Legislature is at work on the immediate financial problems before us, the commission can take a longer-term view and make recommendations accordingly.

The commission’s recommendations should be as free as possible from politics, but I don’t believe it would be in the public’s best interest for the Legislature to cede ultimate decision-making ability to this non-elected group. Florida has a tax commission that makes decisions without legislative oversight, and that panel just sent an ideologically loaded initiative to the ballot that could allow for religious-school vouchers.

A better template would be something like California’s Little Hoover Commission, the oversight agency established in 1962. Made up primarily of citizens, it provides important and thoughtful policy input for legislators and the governor to consider, with the people’s elected representatives having the final responsibility to act. Such an independent group, directed to focus on the state’s revenue structure and containing diverse members with a broad range of experience -- including government, private-sector and nonprofit perspectives -- will provide the best hope for workable proposals.

California may be an economic giant, but in the end, our society will be judged on how it treats its people -- including children in the foster care system, students trying to get an education and elderly people who need a little help to stay out of nursing homes. As speaker of the Assembly, I believe that having a top-notch independent commission to review what’s wrong with our tax structure will be an important tool to build the kind of just, fair and prosperous society Californians deserve.