http://goldenstateblog.latimes.com/Michael Hiltzik
Nov 17
Ohhh....ROB!
The cultural reference is to Rob Petrie, of course, not Rob Reiner, but it’s still very a propos. Reiner, who is uusally identified as an actor/director/activist, is reportedly poised to announce that his universal preschool initiative has collected enough signatures to go on the next statewide ballot, in June. The measure would provide a half-day of preschool for all children over four years old, to be financed by raising the top state tax rate on the wealthiest Californians (that’s individuals earning more than $400,000 and couples earning more than $800,000) to 11% from 9.3%.
Once again, this is ballot-box budgeting of the worst sort. No doubt we can all agree that universal preschool is a marvelous idea. Many of us agree that raising taxes on the wealthiest residents is also a marvelous idea. Yoking the two concepts together is a terrible idea.
Why? Because the top tax bracket is the most precious stream of revenue we have in California. The roughly 25,000 tax returns in the category would produce about $2.7 billion more at the 11% rate. As Reiner and many others (including me) have pointed out, the cost of the increase for the average taxpayer in the bracket would be nominal, and much less than these same taxpayers have reaped from the Bush tax cuts at the federal level. Despite their squealing, it’s hardly likely that many of them, or any of them, would bolt the state in protest. This income class has escaped many of the sacrifices the rest of us have made during the state’s fiscal crisis, and they should pay up. My response to their protests has generally been: "Tough noogies."
But this revenue stream, obviously, can only be tapped once. What’s the argument for segregating the money for the sole purpose of providing preschool?
Reiner contends that preschool yields unique benefits. He cites a RAND Corp. report estimating that California would get back $2.62 for every dollar it invests in preschool.
Promoters of spending initiatives adore such statistics, because while they sound impressive, they're absolutely meaningless and totally unverifiable. At what point would RAND go back and measure the economic effect of Reiner’s preschool act? In 2025? How would it distinguish the payoff from preschool from any of the other myriad variables influencing the budget over a couple of decades? And what if it were wrong? (For a recent example of how promises of payoffs to come can be misused by dishonest initiative promoters, see the stem cell initiative of 2004, which is already looking like a pig in a poke before a single dollar has been spent.)
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