Raising Taxes in a Recession: A Terrible Idea

I've posted several times that the idea of raising taxes in a recession is a poor one. It doesn't matter if its to balance out of control spending or worse to pay for boondoggles like the transit tax scam or the gang tax.  With Angelenos struggling to pay bills, buy gas and get by the last thing the economy can handle is more taxes.  And to top it off your DWP and trash rates were raised significantly again.

Wednesday I had a conversation with a former elected official who now sits on an important local panel.  It doesn't matter who they are.  With respect to the proposed sales tax increase to pay for Westside transit projects the individual told me "investing in infrastructure is one way to stimulate a stagnant economy."

We've heard many politicians say this but it's never really panned out.  Did constuction of the Metro Red Line boost the economy in the late 90s? No, it came from the dot.com explosion and rising property values.  Indeed, the current downturn will naturally be well over before the first train is even run.

The best thing the City Council and State Legislature could do is to CUT taxes and fees.  That means they'll need to make some pretty painful spending cuts.  However very quickly they will see that revenues will increase the more they cut taxes and the more that private investment is stimulated.

It wasn't George Bush or John McCain or even Ronald Reagan who said that "It is a paradoxical truth, that tax rates are too high today, and tax revenues are too low, and the soundest way to raise the revenues in the long run is to cut the tax rates," no, it was President John F. Kennedy who in 1962 significantly cut taxes which led to a long term economic expansion that was stalled by the massive increase in social spending of Lyndon Johnson and his escalation of  the Vietnam War.

Arnold.  Antonio.  Anyone.  Want to follow the lead of JFK?

Mr. Mayor, regarding those trash fees??

This is a good reason why one would want to be in Washington D.C. today.

From this afternoon at "L.A. Now" by David Zahniser.

Remember the plan by L.A.'s mayor to pay for more police officers with the proceeds of a trash fee hike? Turns out the city collected twice as much money as it needed, then used the extra cash on other things, says David Zahniser, our man in City Hall:

The trash fees, imposed in 2006 as part of the mayor’s plan to expand the Los Angeles Police Department, have generated $137 million in new revenue, according to a four-page report released Tuesday by City Controller Laura Chick. But since the new officers have cost only $47.2 million, the remainder has been absorbed into other parts of the LAPD budget, Chick said.

A representative of the Howard Jarvis Taxpayers Assn. voiced little surprise, saying he expected that much of the trash fee revenue would go toward other parts of the budget, including a three-year package of police raises. “Often what happens to tax increases in this city, instead of getting more employees, we just get better-paid employees,” he said.

Villaraigosa initiated the higher fees in 2006 as part of his LAPD expansion plan and is now more than halfway toward his goal of reaching 1,000 new officers. The trash fees went from $11 to $26 per month for homeowners between 2006 and June.

All of which leaved us wondering -- what's going to happen to the city's plan to hike fees by another $36.32 per month?

One may want to start filing those extra trash bags for Ron Kaye's "trash dump" on City Hall.

Antonio Villaraigosa, King of Trash

When the word came out that poor neighborhoods in Los Angeles became dumping grounds for trash, where was our Mayor? On a junket in Israel.



A report on the problem issued Tuesday defended city officials despite growing mountains of smelly, rotting trash sitting for weeks amongst residents who have little power or influence to do anything about it.  The Mayor's point person on the issue, Board of Public Works President Cynthia Ruiz had the nerve to say "We have been doing a fabulous job," despite towering piles of filth and a dysfunctional patchwork of city departments that won't communicate with one another and get little done.



While poor people sit amongst the stench what does the Mayor do? He trolls for dough with people who would never have to worry about this kind of problem. 



And it's not just trash. Traffic. Crime.  The economy.  Taxes.  Cuts in City services. Hell they've raised your trash taxes twice already and want to do it again!  We won't get into his personal ethics when it comes to cheating on his wife or fundraising that reeks.  Are you better off today than you were four years ago?



If you say no, you can thank the King of Trash!

Saturday Special Hotsheet

Old Bank Building in Highland Park - Photo by Mayor Sam

The Daily News asks "Wasn't the last trash fee increase supposed to pay for new cops?" Yes, it was. They also accuse the Mayor of lying. Wow. The Mayor lie? Unbelievable. Yes, the Mayor lies.

Speaking of more lies from your elected officials, you knew about the DWP rate hikes the Clowncil pretended to be against and then voted for a week later. What you don't know about are secret DWP surcharges that can be passed onto you with no notice on a regular basis. These surcharges are even more than the rate increase.

Not believing Chief Bratton's "Culver City" spin, the troops are defying their leader. The Los Angeles Police Protective League has come out against his stand in favor of Special Order 40 and is supporting Councilman Dennis Zine's watered down version of Jamiel's Law. It's a baby step and a bit in the wrong direction, but it's a start nonetheless.

Billionaire investor Ed Roski announced his plans Friday for a new football stadium for Los Angeles, this one on land he owns in the City of Industry. Though there is no team slated for the stadium, local pols are still pursuing the dream of an NFL team at the Los Angeles Memorial Coliseum and state legislators are vowing no public funds, Roski's going to go ahead anyway.

If you went to law school and have big time student loans to pay, you might consider becoming an attorney for Britney Spears. In the last month she's spent $375K for lawyers in her child support case, almost as much as in her conservatorship hearings and a weekly retainer of $10,000 to her court appointed lawyer.

Crime and Punishment in Los Angeles

Today I arrived to my vehicle - parked in a secure garage - to find this:


Unfortunately, the bandits made off with the Mayor Sam Mobile Unit - laptop, web cameras and other assorted remote blogging doo-dads (but not the dreaded BlackBerry).

Digital security cameras and a crack Senior Lead Officer might nab the bandits. And auto and rental insurance may cover some of the damage.

Still I will not vote for or support any of the shady taxes, fees, assessments etc. allegedly for hiring more cops. Let's cut the rest of the budget first and eliminate the nonsense.

Mayor Sam readers, bloggers, politicians and local denizens alike should not worry that the theft of this laptop means the loss of any sensitive Sister City data. The old, dead Republican Mayor makes use of online applications like Google Apps so nothing is saved locally.

I just miss all my doo-dads.

Mayor Sam's Hotsheet for Tuesday

A big day for one of the projects on our list of faultlines for the Coming City Superstorm happens Tuesday in the Los Angeles City Council Chambers. Councilman Greig Smith will seek to put an end to work by the City of Los Angeles on the environmental impact report for the controversial Las Lomas development. Smith will battle Councilman Richard Alarcon who is seeking to bring the project under the control of the City of Los Angeles despite objections from the County and the City of Santa Clarita.

Mayor V wants to raise your trash fees and he supports raising your electricity and water rates too. If you want to protest the trash tax, KFI's John and Ken are encouraging you to mail your trash to Tony Villar.

Our friend Jon Regardie at the LA Downtown News has a great piece - the Tony Villar re-election announcement press conference that wasn't. But we can dream right?

Rick Orlov is right that it won't go anywhere but a group of "progressive" Democrats held an event to issue a "no-endorsement" for Democrats Henry Waxman and Howard Berman. I guess Waxman and Berman are not liberal enough for this group. (Okay I'll stop laughing.)

And finally Mayor Villaraigosa won an award from a Filipino group and told attendees gathered "Filipinos are not invisible to me." By the way the event was held at the Autry National Center, another faultline on our list of The Coming City Superstorm.

Tony Villar Dumps Trash on You

Its getting to be a near annual event - where an LA Mayor decides to up the trash tax.

In 2005, Mayor Poopy was going to do it before Tony Villar booted him out of office. In 2006, when city revenues increased $700 million, the city came back to you charge you for more trash money. They told you it was for more cops - but Walter Moore found out that wasn't true.

In the last two years, trash fees for homeowners and renters have gone from $11 to $26 and now they may go to $38 per month.

Instead of raising trash fees, how about outsourcing the whole operation and saving even more money than you'd earn by raising taxes. Trash collecting is not supposed to be a union, career job. Its a low skilled job for people with low skills. If they want a career wage, go get some education.

The only thing about as regular as raising trash fees is raising the Mayor and Council's salaries. But you people sit back and do nothing, especially many of those clueless ninnies on Neighborhood Councils who say "Oh we can't challenge the city - they'll take away our funding to plant trees!"

They told they had to pass the illegal, shady phone tax which a bunch of clueless little old ladies voted for in droves - because they needed more money. You thought that would be it, but Tony Villar and the 15 Clowncil Members will be back for even more. Trash fees, other fees, hidden taxes, water increases, etc.

And the big kahuna is coming - as Zuma Dogg and I have both been telling you for months - the city personal income tax better known as the "occupational license fee." (Because when is a tax not a tax? When it's a fee.)