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Grover Virus Fells California

Now 81 days without a budget, just today I learned the cause of the stalemate in Sacramento:  we are the first to go swirling down the drain of Grover Norquist’s bathtub.

John Laird, the Democrat who chairs the budget committee in the lower house, the Assembly, told me today that the reason the Republicans have held firm on their “no new taxes” pledge–even though it will cripple economic growth and education for years to come–is that all but one of the GOP in the Assembly have signed a pledge to reject all tax increase proposals, even from their own Governator.  And they all know that if they fall off the wagon they will be taken out at the next election; just like kindergarten, they make an example out of one guy, and it keeps the rest in line.

So, instead of some modest tax increases to close a $17-billion gap, we get a payday loan plan.  Starting January 1, the payroll withholding rate doubles (from 5 to 10%) but the tax rate doesn’t go up.  For 2009 only (they say), every worker in California will loan the state a few bucks each paycheck, interest-free, creating a loan pool of about a billion dollars.  In April of 2010 (they say) they will refund the extra tax we paid.  Can you think of a more regressive tax?  In Grover’s book, this is not a tax increase, it just feels like one.

Arnold has painted himself into a corner, one Dem said “he’s a leader with no followers”.  He broke his own pledge a few weeks ago and proposed a sales tax increase (only slightly less regressive) and could not get a single member of his party to support it.

And now Schwarzenegger is vetoing the stinky budget that passed by a veto-proof margin, further delaying the resumption of payments to millions of people, plus schools and nonprofits.  The squabble now is about the terms of a “rainy day fund” that is supposed to prevent budget gridlock in the future.

The Grover virus is most dangerous when it combines with the Jarvis strain of anti-tax radicals here in California.  They passed Prop 13 in the 1970’s which limits property taxes, and are ruthless enforcers like the Norquist gang.  They use thuggish tactics and minority rule and they are winning.