Dan Walters' Capitol Q&A

Question: I recall a column of yours where you pointed out that California's progressive income tax is actually exacerbating our state budget problems because only a relative few taxpayers (5 percent) pay something like 90 percent of the income tax revenue. Do you have the exact figures?
-- John Gamper, Sacramento

Answer: I put it this way in a column last April: "Californians in low- and lower-middle income strata pay virtually no state income taxes, while those in upper-middle and high income levels pay virtually all of them, according to data published by the Franchise Tax Board, and the 'progressive' nature of the income tax system is most pronounced at the top. Those with incomes of $300,000 or more - just 221,324 tax returns, or 1.6 percent of the 13.8 million filed - paid 48.1 percent of the $36.1 billion in income taxes collected in 2004, and the top 37,558 tax returns, those with $1 million or more in income, paid 29.9 percent, some $10.1 billion."
--Dan Walters

Question: Concerning the fiscal emergency declaration, what happens next? The governor has declared a fiscal emergency and the legislature must act within 90 days? So what happens if the Republicans and Democrats cannot agree to a plan within that time frame? Does the governor obtain dictorial powers and slash at will? If so, it seems to me that the end game would be for the Republicans to stall until the time runs out, then the governor will get his drothers.
-- Bob Kelly, Keyport, N.J.

Answer: The law does not require them to solve the problem, merely address it. If they don't, the governor doesn't have any power to unilaterally make spending cuts, although he's suggested that he have such powers through a constitutional amendment.
--Dan Walters

Question: You have commented frequently on the politics of Prop. 93. What about the merits? Do you suggest voting for or against it on public interest grounds?
-- Carl Danner, Alamo

Answer: I never suggest voting for or against anything.
--Dan Walters

Question: While watching Gov. Schwarzenegger's State of the State address, I got to thinking back to covering Gov. Jerry Brown in 1977-78-79 and wondering what he said 30 years ago. Couldn't find his 1978 State of the State online, but did note that he ended up cutting the budget six months later due to Prop. 13. The search turned up Ron Roach's 1998 look back at Gov. Wilson's approach to deficits, which included raising taxes on the rich. How have our governor's approached deficits, and how did it all work out?
-- Ted Langdell, Marysville

Answer: Wilson did twist Republican legislators' arms to enact a big tax increase, emulating, albeit on a smaller scale, what Republican Govs. Ronald Reagan and George Deukmejian had done when they inherited budget gaps. But Wilson later recanted, saying that he regretted raising taxes. Democrat Jerry Brown actually cut state taxes during his eight-year term, responding to the anti-tax fervor of Proposition 13, but that created the deficit that Deukmejian later inherited. Eventually, Deukmejian presided over a one-time tax rebate when state revenues spiked upwards in the mid-1980s.
--Dan Walters