I TOLD you Gov. Steroid would try to increase taxes

Last December, I predicted:

Arnold will try to increase taxes next year

Arnold faces a $14 billion deficit. What will he do?

In his January budget, he’ll call for only massive spending cuts to balance the budget. This will be the beginning of a kabuki dance with the Democratic Legislature. They will denounce him for “hurting the poor,” etc…

Then he’ll come out for…

major tax increases — at least $5 billion, I’d guesstimate.

Bingo.  The L.A. Times reported today:

Gov. Arnold Schwarzenegger proposed during private negotiations over the weekend to close the state’s $15.2-billion budget gap with a temporary but immediate one-cent hike in the state sales tax, according to legislative sources….

The governor could declare that over time — perhaps a decade or longer — his statewide plan amounts to a tax cut. In the near term, it would raise more than $5 billion per year.

What a bunko artist. A tax increase becomes a tax “cut”!

A tax increase in the midst of an economic recession would hit the state like a 9-Richter earthquake. Citizens will leave or not come here, businesses will take off, and people will buy more stuff tax-free from the Internet. They might not get that $5 billion.

And, with people leaving the state, other revenue sources — especially the income tax and capital gains tax — will take a big hit, maybe as big as $6 billion or more. In other words, the tax “increase” would increase rates, but not revenues. It would be a negative tax.

That happened in the early 1990s when then-Gov. Pete Wilson, another “moderate” Republican and mentor to Gov. Steroid, increased taxes and saw state revenues decline by $2 billion, from $42 billion to $40 billion.

Federal and state tax hikes, too

Gov. Steroid’s tax-increase obsession isn’t the only one. Local governments across Taxifornia are getting in on tax-increase mania.

Both Barack Obama and John McCain are talkin’ tax increases.

And let’s not forget that the Federal Reserve Board’s inflationist policies are a tax increase. Is your salary keeping up with increased prices for gas, groceries, and much else? I didn’t think so.

So we could get a triple-whammy: federal, state, and local tax increases. Is it any wonder the economy is floudering?

Will they ever learn?

And Gov. Arnold’s sales-tax boost won’t be “temporary.” It supposedly will last 3-4 years, conveniently getting Gov. Steroid beyond his term in office. Then the next governor — Jerry Brown, Sen. Feinstein, or some other Democrat — will have to deal with the problems created by Arnold’s tax increases and crashing economy. And they’ll deal with it by continuing the tax.

A couple of years ago, unemployment here was below the national average. Gov. Arnold’s policies have increased our unemployment rate by 1.6 percentage points in just the past year, to 6.9%.  to the third-worst in the nation, behind only depressed Michigan and Rhode Island.

This is really what Gov. Arnold means by “postpartisanship”: He’s worse than Republicans and Democrats.