George Runner Interview on Prisoner Release

Raising Oil Companies’ Taxes Will Kill Jobs

As published in the Press Enterprise:

Ask anyone what he thinks about gas prices and you’ll likely get an earful. The average price of gasoline in California has risen to more than $4 per gallon — and, motorists are feeling the pain.

It’s easy to blame big oil companies for this problem, and many do. However, doing so does nothing to explain why Californians see roughly 10 percent higher costs on average at the pump than the rest of the nation.

Nor does it explain why we refuse to tap the oil in the ground beneath our feet, which would create both new jobs and revenues.

Not coincidentally, California’s oil production has dropped by almost 45 percent in the last 25 years, and our refining capacity has not kept pace with demand.

Limited production and refining capacity drives up the price we all see at the pump, especially given California’s unique fuel-blend requirements.

Furthermore, California’s fuel taxes are the highest in the nation. Californians pay a shocking 66.1 cents per gallon in federal and state taxes and fees each and every time they fill up their tanks.

Truckers pay even more — 76 cents per gallon of diesel. These higher costs hit small businesses and working families squarely in the pocketbook.

Wanting to punish oil companies, some are proposing a new type of tax on oil production called a “severance tax.” This proposal would take the going rate for a barrel of oil and apply a 12.5 percent tax to that value at the point it is produced.

But instead of punishing the oil industry, we’ll end up punishing ourselves. The result will be more lost jobs and less revenues.

In January 2009, the Law and Economics Consulting Group released a study on the effects of a proposed 9.9 percent severance tax.

The study found that 10,000 jobs would be lost almost immediately if the tax were passed. Additionally, many of the roughly 100,000 jobs closely related to the oil production industry would be placed in jeopardy.

Now, remember California’s oil production has plummeted by 45 percent in the last 25 years, which is bad enough. With a severance tax of 9.9 percent, much less the 12.5 percent that is currently being proposed, production would further decrease by upward of 80,000 barrels a day.

Driving this much production out of California would undermine California’s economic recovery.

It would hurt property-tax revenues, as well as sales and use taxes, effectively hamstringing whatever benefits severance-tax revenues might have provided.

Any short-term boost in state revenue would be immediately undercut by permanent job losses and a further weakening of industry.

Given that California’s unemployment rate now ranks higher than Michigan’s, it’s foolhardy to place any of our remaining jobs in jeopardy.

Alberto Torrico, a former assemblyman and one of the severance tax’s major proponents, argued that without the severance tax, California is “giving away the energy for free.” This is, of course, silly when the state already imposes a plethora of taxes and fees on both the industry and consumers.

For the seventh straight year in a row, a survey of CEOs ranked California as the worst state for business. Torrico’s tax proposal would ensure our state retains this dismal distinction for years to come.

don’t kill jobs

Driving more jobs out of California is not an option. It is bad policy for a state to devastate an economy already reeling under high unemployment rates with an onerous new job-killing tax.

Instead, we should orient our tax and regulatory systems to be jobs friendly. Doing so is the only way to speed California’s recovery and help hard-working families.

George Runner, R-Antelope Valley, is a member of the California Board of Equalization.

Runner Blasts High Court Decision

As published at Flashreport.org:

As the lead legislative intervenor challenging an August 2009 federal court order reducing California’s prison population, I am dismayed by the U.S. Supreme Court’s decision today in Brown v. Plata.

The decision to force California’s prisons to release 46,000 convicted felons is a historic attack on the constitutional rights of states and the liberty of all Californians.

By flooding our neighborhoods with criminals, the Court will make one of highest taxed states in the nation among the most dangerous as well, further tarnishing the California dream.

At a time when law-abiding Californians cannot find jobs, it’s hard to imagine how convicted felons will do anything other than return to a life of crime.

But at least Justice Kennedy can sleep easier at night knowing that none of these dangerous felons will be released in his neighborhood.

Less Government, Please

As published in the FlashReport:

Treasurer Bill Lockyer caused waves last month when he suggested that given Republican lawmakers’ opposition to higher taxes, their districts should bear the brunt of spending cuts. He said, “The people who want less government ought to be at the front of that line to get less government.”

Senate Democrat Leader Darrell Steinberg expressed openness to the idea, saying, “You don’t want to pay for government, well then, you get less of it.” He added that any district-targeted cuts should not hurt “kids or the vulnerable” but instead be limited to “convenience services that affect adults.”

Outrage to the proposal—appropriately so—came fast and furious.

Senate Vice-Chair Bob Huff said the proposal was “just nuts.”

Jon Coupal of the Howard Jarvis Taxpayers Foundation compared the idea to the strong arm tactics of an organized crime protection racket. He also suggested it might violate the equal protection guarantees found in both our state and federal constitutions.

Even the Los Angeles Times called the plan “ham-fisted and wrong.”

Mr. Lockyer’s point merits further consideration and a more thorough response.

Republicans do want less government. We believe our state’s fiscal problems are the result of too much spending, not too few taxes.

We believe that government spending doesn’t produce happiness. Instead we know that government spending can foster dependency, stifle entrepreneurship and fund wasteful bureaucracies. We also know that government programs tend to grow larger and larger yet often outlive the purpose for which they were created. Some even create more problems than they solve.

We Republicans question how it is that some states manage to do more with less and are also able to grow jobs. We ask why so many businesses are choosing to locate or expand outside California, and why our state’s unemployment rate is higher than nearly every other state. We’re also pretty confident we know the answers to these questions.

The evidence backs us up. According to the Tax Foundation, Californians bear the sixth highest overall tax burden in the nation. California’s income taxes, sales taxes and fuel taxes rank at or near the top. If not for Proposition 13, which protects homeowners by limiting property taxes, our overall tax burden would be far worse.

Despite the fact that California taxes and spends more than most other states, our schools and roads don’t reflect it. And a diminished private sector is forced to pay more to support state worker wages and benefits that exceed those of many private sector workers.

Contrary to conventional wisdom, increased government spending can actually hurt a state’s economy. A little-noticed 2010 Harvard Business School study found that increased federal spending in states with politically powerful leaders causes “significant retrenchment” by corporations, dampening investment and employment activity.

It’s not too much of a stretch to say that state spending could have the same impact.

Yes, less government can be a good thing.

The real problem with Lockyer’s proposal is that it doesn’t go far enough. If Republican lawmakers are asked to accept less tax dollars for their districts, they should get to determine where and how those dollars are spent.

They should be empowered to enact policy reforms they have long championed to help California’s struggling private sector create jobs, including less red tape, lower taxes, reduced energy costs and real tort reform.

They should be allowed to enact commonsense education reforms putting kids first by freeing teachers and locally-elected schools boards from Sacramento’s micromanagement and granting parents more control over their children’s education.

Public-private partnerships could boost these efforts and move California’s transportation system into the 21st century. They could also expand our state’s dismal water storage capacity and help with other infrastructure needs.

These reforms would revitalize areas of our state currently plagued by joblessness. Rather than flee California, businesses could relocate to more friendly terrain available only in Republican districts. Employers in other states might, for a change, see California—albeit only some parts—as an attractive place to do business.

If accompanied by real reforms, Lockyer’s spending cuts could be the best thing that ever happened to Republican districts. Economic growth and job creation would lead to lower unemployment; increased government revenues could be invested in local priorities or returned to taxpayers.

Mr. Lockyer, if less government truly means less government, then count me in.

Runner Responds to Governor’s May Revise

As published at Flashreport.org:

Overtaxed Californians will find little to cheer in the Governor’s revised budget proposal.

Despite the Governor’s concession to postpone higher income taxes for a year, he continues to push for legislative approval of higher sales taxes and car taxes this year.

And although the Governor dropped his effort to abolish enterprise zones—and the jobs they create—he continues to miss the big picture: Californians need jobs, not higher taxes.

Our best hope for new revenues isn’t higher taxes, but new jobs fueled by a recovering economy. Unfortunately, the Governor has yet to truly lift a finger in the fight for California jobs.

Republicans Show True Courage

As published in the Sacramento Bee:

Conventional wisdom in California’s perennial budget crisis is that lawmakers who support tax increases are courageous, while those who refuse to go along are, well, cowards.

The John F. Kennedy Library Foundation reinforced this misguided notion last year by handing out “Profiles in Courage” awards to four legislative leaders who inflicted billions in higher taxes on average Californians struggling to survive a steep economic downturn.

Courage, it seems to some, is the willingness to pick another’s pocket when one’s own bank account balance is running low.

Despite his public persona of frugality, Gov. Jerry Brown shares this view.

In his State of the State address earlier this year, Brown argued that California would once again be a leader in “job creation, renewable energy and education” if lawmakers could find “courage to tackle our budget deficit head-on.”

For the political layman, tackling our budget deficit “head-on” is the governor’s code phrase for billions in more taxes, which Brown fervently supports.

Case in point, last month the governor used a crime victims rally to send an even more pointed message. He told the victims: “I’m hoping that your courage will become contagious and inspire the reluctant few Republicans who we need to join up and get our budget done.”

Thanks to an initiative approved by voters last fall, the governor and a simple majority of his legislative allies are free to pass a budget based on anticipated revenues – about $85 billion – with no Republican votes at all. The only reason the governor wants Republican votes is because he needs a two-thirds vote to raise taxes.

By way of perspective, the state of California’s budget was less than $85 billion as recently as 2004. If the state bureaucracy survived on that amount before, it can do it again.

According to Merriam-Webster, courage is “the mental or moral strength to venture, persevere and withstand danger, fear or difficulty.” Cowardice is the opposite.

It may be the governor himself who lacks courage to close a budget deal.

In March, five Republican senators reported that they had “reached an impasse” in negotiations with the governor because their “substantive reform proposals to create jobs, require responsible state spending, eliminate abusive pension practices and implement meaningful governmental reforms” had been “either rejected or so watered down as to have no real effect.”

The senators concluded that the governor was “unable to compel other stakeholders to accept real reform.”

Later that same month, it was the governor, not the Republicans, who pulled the plug on budget negotiations. Rather unconvincingly, the governor claimed a deal was impossible because Republicans were asking for too many reforms.

New California Republican Party chairman Tom Del Beccaro recently took Brown to task in an op-ed titled “If Only Jerry Brown Had Andrew Cuomo’s Courage.” Del Beccaro argues that true courage is being shown by New York’s governor, a Democrat, who rather than raise taxes is trimming government bureaucracy and waste to close his state’s budget deficit.

When asked why he won’t support increasing taxes, Cuomo explains: “I believe it’s counterproductive for the state. I believe more people will leave the state and you’ll have less revenue.”

According to the Tax Foundation, New Yorkers have an even higher tax burden than Californians – but both states have the dismal distinction of making the top 10 list of states with high taxes.

Does Brown really believe he will lower California’s unemployment rate – which remains among the worst in the nation – by raising taxes to New York levels or higher? Does he really think job creators want to come to a state with high taxes, high costs and regulatory uncertainty?

True courage is exhibited by men and women who are willing to stand for their convictions against incredible opposition.

But having courage means little if you’re wrong.

I recently heard an elected official from the Bay Area proclaim that she believes taxes should be higher. She certainly displays courage by honestly communicating her belief. But she’s wrong. And anyone else who thinks higher taxes will help California’s private sector economy create jobs and be more competitive is also wrong.

The true unsung heroes in California’s budget crisis are those lawmakers who have the courage to oppose higher taxes despite tremendous pressure to compromise.

Though the John F. Kennedy Library Foundation may refuse to acknowledge them, overtaxed Californians are grateful for their courage.

On The Money: Internet Police

From CBS 13:

With California deep in debt, a controversial plan has emerged that calls for private vendors to monitor what you buy on the Internet.
…
“This is just a fishing expedition as far as I’m concerned,” said George Runner, an elected member of the Board of Equalization.

Runner is fighting the Board’s staff proposal. CBS 13 asked him to explain how it was pitched to the Board:

“One of the ideas is well, we think there might be some people who will sell us data,” Runner warned about the proposal. “That will tell us what kind of credit card transactions or private transactions that a Californian may have made in purchasing something out of state,” he told CBS 13.