Fix the State, Now!

Vote No on the Deja Vu Budget!

Just like in the Matrix, if you get a sense of déjà vu, you’re in real trouble.  Legislative leaders, along with the blessings of the governor and CTA, are trying to push together another “compromise” budget, which does nothing but guts our schools and state services.

Please contact your legislator before tomorrow and ask her/him to vote no.  Thankfully, the California Federation of Teachers has a link that will allow you to send the message to your legislators.

The new budget doesn’t appropriately fund critical state services and doesn’t fix the long-term structural problems in the state government.  In fact, it digs a deeper hole for the future.

Any discussion of the $7.5 billion we could gain each year if we change Prop. 13?  No.  Any discussion of oil severance taxes?  No.  But the oil companies do get to drill off shore. Any deal on the two-thirds requirements for the budget and new-taxes? No.  Vehicle License Fee?  You guessed it… no discussion. Where’s the compromise in this compromise?

The irony is that the republicans might torpedo the deal because it cuts too much… from prisons!

 

Steve Miller, a high school science teacher in Oakland for 25 years and long-time building rep. for OEA, highlighted the corporate tax breaks written into the budget deal:

“So what was accomplished? If you are a corporation, you are rubbing your hands with glee.

“1) Secret negotiations in February now permit these special breaks: Corporations can choose to be taxed on ANY ONE of these categories: property, sales or payroll. Not all three – they get to pick one. Remember Prop 13 has left corporate property valued at close to the 1978 level.

“Then corporations that have maxed out their tax credits can share them with a family of corporations. This means you set up a phony corporation to fail and give them some of your tax credits, so you can get some more. Lastly, corporations can claim tax refunds early on taxes they have already paid.

“The banner headlines are not going to present these little details, but you can read them in the Oakland Tribune, July 11, 2009.

“2)  Negotiations last Fall put in place a series of upfront and backdoor loans to corporations in exchange for some early revenue.

“A)  The first gimmick suspends corporate ability to carry forward net operating losses to offset future profits for two years. Sounds good, doesn’t it? What a deal this was! Corporations could take today’s losses and use them to reduce future expected profits. Good that it was eliminated.

“Except now corporations can carry back losses against past profits and claim tax refunds from prior years. According to Dan Walters of the Sacramento Bee (Oakland Tribune, October 6, 2008), this deal will produce about a billion dollars a year during the suspension, but means the state will be paying back a half a billion a year forever – “another extremely high=interest loan from business to the state”.

“B)  Gimmick #2 allows a second corporate tax break: Businesses received in the past certain income tax credits to encourage certain kinds of investment. These will be suspended for a couple of years, producing about $600 million a year in revenue for the state. Then It allows corporations to transfer those unused tax credits to affiliated companies in the future. This will produce revenue losses in the future that will be many times the mere 3%+ of the budget deficit this fixes.

“State Treasurer, Bill Lockyear, had this to say about that, “This giveaway makes the budget a massive corporate boondoggle that does nothing to fix our structural debt, and, in fact, will make it substantially worse.”

“Schemes like these mean that corporations will pay less and less. It is already pretty bad. In 2001, profitable corporations, over half the state’s profitable corporations paid only the $800 fee to register their corporations’ existence in the state. Those were the good old days!

“California already subsidizes corporations in a wide variety of ways. There is no budget crisis at all even if these giveaways were simply cut in the same proportion with social services. Once again, the budget does not impose a severance tax on extracting petroleum (though it does open the door to the highly unpopular off-shore drilling near Vandenberg Air Force base near Santa Barbara). The state’s water is provided to agribusiness at something like 1/400 the cost that consumers pay. Insurance companies that control the state’s health care pay zero income tax. The state’s constantly growing system of jails subsidizes all sorts of business, while giving the state the highest rate of incarceration in the world.”

So, once again, we have to watch as local school boards are forced to shred our schools, knowing that county governments, senior care and health care services are getting cut even more dramatically. 

In addition to all the corporate give-aways, we also know that there is money out there...  ACLU's current research has shown that there's $12 billion savings available from over-incarceration, $7.5 Billion available each year if we fix the Prop. 13 corporate loophole, potential income from oil severance, vehicle license fee, and billions of other potential revenue if corporations are simply asked to pay a fair share.

I'm caught up with the realization that, again, CTA barely put up a fuss.  And, the democrats were partners in the deal.  How do we get our Union to fight back?  How do we get our "progressive" state legislators to act on behalf of the majority of people in the state?

 

CTA: Turn up the LOCAL Heat on the State Budget

It’s been great to see CTA stepping into the fight on California’s budget.  With 9,000 teachers marching to the Governor’s office in San Diego, or joining our sister Unions in the series of rallies on Wednesday at the Governor’s five regional offices, there is finally something to cheer about.  CTA’s website is also becoming a little more user-friendly for writing a letter to the governor and state legislators about the state budget.

Of course, news from Sacramento is still deeply disturbing.  If the only question is whether or not to suspend Prop. 98, we’re still going to lose.  Status quo keeps us behind.  For the future of California schools, we have to lend our voices to efforts to close the Prop. 13 loophole, end the two-thirds budget approval mandates, and build a progressive tax system.  Ultimately, we won’t win the state budget fight unless we bring it home into our local communities.  Legislators need to feel the heat from the people who will work to re-elect or un-elect them.  

This is the time of year when our local CTA activists are planning their Union activities.  We all know the strategies that work when we fight our districts for our contracts.  We use these strategies because they work, so we should use the same strategies for fighting our legislators that we use when we’re fighting for fair contracts.  Here are a few grassroots strategies that CTA locals can use to have an impact in the budget fight:

1. Letter writing/ Phone campaigns (Very Easy): Use leadership meetings and site meetings to write letters to legislative leaders and local media.  Start with a sample letter and addresses.  Then encourage each of your leaders to repeat that activity at their school sites.

2. Picket/protest/lobbying meeting at your legislators’ offices (A little more planning): Host a picket/protest at your legislator’s home office.  Democratic legislators should be encouraged to harden their stance on the need for more revenue.  GOP legislators should be cajoled into giving up their “no-new-taxes” pledge.  Invite the local newspaper, radio station, TV station or blogger.

3. “State Budget Crisis” forum (More planning… but really effective): Invite teachers, parents, media, community leaders and legislative staff.  Find a few teachers for the “panel” to talk about how budget cuts have already hurt “our” school and “our” community.  Make the case that more budget cuts will hurt more.  End the meeting by recruiting audience members to get involved with ongoing campaigns coordinated by CTA, the California Labor Federation, Close the Prop. 13 Loophole, and your local Union efforts.

4. House Parties:  Find members to invite neighborhood folks into their homes.  Share local stories about how the cuts have hurt our students so far.  Show CTA commercials and UTLA radio spots.  Raise money that can be used to air these ads in cities with targeted legislators.

Ultimately, the fight has to be fought at home.  The only way that legislators will move is when they feel the heat from their local community members.  But our locally fought efforts will be more productive if they are coordinated by a strong state organization. 

Governor is still in character!

The San Francisco Chronicle reported this week that Governor Schwarzenegger believed the people were standing behind him while he worked to destroy California; and he would continue to dismantle schools and social programs.  It looks as though his days as a steroid-popper have created some deeply delusional side effects.

The Governor claims now that “fixing” California is why he was elected.  He conveniently forgets that most of California’s debt comes from his revoking of the vehicle license fee, the debt from his bond measures, and California’s ever-increasing prison costs due to mandatory sentencing.  He’s also forgotten that the only real reason that he was elected is because he is a rich movie star.  We didn’t know that “Terminator” would be more than science fiction. 

Unfortunately, the Governor has stayed in character far too long.   He can’t discern fact from fiction.  The November elections saw gains for democrats in both houses of the state legislature.  Sixty percent of the legislative districts in California voted against Republicans because the “let’s burn down the state so our rich friends don’t have to pay their fair share of taxes” message wasn’t working for them.

And he’s listening to the wrong people.  The anti-taxers always complain that the tax rates are too high, but they fail to mention that the loopholes for California’s biggest corporations are even bigger.  More than 40 California corporations with income of more than a billion dollars pay less than $1,000 in taxes each year.  That’s less than you and I pay.

His aides talk about “the nuclear option” of suspending Proposition 98’s minimum guarantee of subsistence education.  Those 9,000 teachers who showed up at the Governor’s San Diego office last week weren’t there to express their support.  CTA’s raucus action in defense of Prop. 98 voiced the outrage felt by millions of Californians who are at risk of losing schools, community centers, libraries, senior care and community health centers.

The real legal roadblocks to a functional state government are Prop. 13 and the two-thirds budget approval mandates etched into the state’s constitution. The majority of Californians don’t want to see their communities dismantled.  Can we please, for once, try to fix the real problem. 

Take Action Now: Close the Proposition 13 Loophole!

Finally.  Someone is taking on Proposition 13.  Led by San Francisco Assessor Phil Ting, a new organization called “Close the Loophole” packed the house with more than 100 activists for its first organizing meeting in San Francisco last night.

The Close the Loophole campaign seeks to change Prop. 13 so that corporate land owners are forced to pay their fair share in taxes for the first time in 31 years.  The idea is to split the property tax roll so that grandma next door isn’t taxed out of her house.  But land owned by old monster corporations who never sell and never die will be reassessed so that they are forced to pay taxes at a level which is fair in 2009 dollars. 

It has almost become monotonous to talk about the impact of California’s budget crisis, but the devastation of our social programs has already begun.  The Split Roll change would raise at least an additional $7.5 Billion every year for California public services, which is a step in the right direction.

Many important Unions were there, including CNA, AFSCME and SEIU.  There were also a lot of community organizations.  And while there were a number of teachers in the crowd, California Teachers Association was notably missing. 

While teachers and students across the state are sweating out yet another devastating budget, CTA is still waiting to jump into the fight.  The good news is that there are a lot of allies who recognize the need to change California’s unfair tax policies, and they’re already doing the groundwork.  All CTA and its local leaders have to do is get on board.

Like all historic movements, it looks like this one has to start at the grass roots.  So, local Union activists, go to www.closetheloophole.com, and sign up.  Get the word out to the members in your local.  Facebookers can get recruit their friends by becoming a fan at www.facebook.com/ClosetheLoophole.  Then, encourage your CTA staffers, board members and state council representatives to take up this fight on a statewide level!

Many of you remember how powerful CTA was when working with the Alliance for a Better California to stop the Governor’s attacks on public services.  If so, you can imagine the incredible impact that we could have with a coordinated statewide effort to plug our members into this campaign.  It’s the right fight, and with 27,000 RIFs looming, it’s time to jump in.