Posts Tagged 'Michael Boskin'
Slimy Parsky Oil Play and a Yorba Linda Lecher
As we first reported late Wednesday, tax reform commission Chairman Gerald Parsky sucker-punched at least some members of his panel by sending them an unexpected, last-minute recommendation to generate "tens of billions of dollars" of new revenue by vastly expanding offshore oil drilling in state waters.
Also in the last-minute materials was the final proposal for a nearly-flat (two-tier) personal income tax that would give a massive tax cut to the richest California taxpayers and a teensy-weensy slice to the poorest taxpayers. Coupled with the knuckle-dragging business net receipts tax, the Parsky proposals are about as regressive as musclebound Gov. Schwarzblunder and his diminutive, cigar-sucking sidekick Susan Kennedy could ask for.
But at least commissioners and the public knew that was coming. The revival of Schwarzenegger's proposal (which we understand was the brainchild of his economics guru David Crane) to gain approval of the twice-defeated Tranquillon Ridge offshore oil project as a tax-revenue scheme — now that was a nasty surprise.
"There are several economic reasons for permitting new oil leases," reads the oil-drilling recommendation, to be considered by the commission today, when it meets to craft a final proposal to send to the governor and Legislature. "Unlike all other revenue sources, the oil companies, which would make these new royalty payments, have requested the ability to do so. Revenues from this source would create no economic distortions, and the economic activity being taxes could not migrate elsewhere."
The recommendation came as a shock, not only because the offshore issue was only casually discussed during the commission's months of hearings, but also because it deepened the atmosphere of secrecy and sleight-of-hand in which Parsky assembled the agenda for the panel's final, crucial meeting. As a political matter, such an expansion of offshore drilling would also directly conflict with decades of state policy, in which environmental protection of coastal waters and beaches have trumped economic issues, resulting in a long-held moratorium on new leases.
The proposal for more offshore drilling seems to have worked its way onto the commission's plate at least in part at the request of conservative Hoover Institution economist Michael Boskin, who also sits on the board of Exxon Mobil.
The commission's analysis cites a State Lands Commission study estimating that there are 1.635 billion barrels of "recoverable oil on state lands that are not currently under lease." The U.S. Minerals Management Services, which controls leasing and drilling on federal lands beyond three miles from shore, projects an additional 10.1 billion barrels that remain "undiscovered but is technically recoverable."
Current royalties paid by oil companies on a small number of existing, small state leases vary from 16.7 percent to 55 percent of the revenues they generate, which altogether yield about $400 million for the state.
"If the ban (on new leases) were lifted," the recommendation says, "it could make available the 1.63 billion barrels (and) California would receive a share of revenue from new leases on federal lands off of the state's coast."
"Over time, the state could receive as much as $34 billion in royalty revenues from new leases in California waters, assuming oil trades on average $70 per barrel and the average royalty rate is 30 percent."
The recommendation, sure to draw the ire of environmentalists and coastal legislators, pointedly does not suggest imposing a new severance tax on oil companies. California is the only oil-producing state that does not have such a tax, which is being pushed in the legislature by several members of the Assembly, including Assemblymen Pedro Nava, D-Santa Barbara, and Alberto Torrico, D-Fremont.
BTW: There's no frigging way the agenda and agenda packet was ready early enough for the public to have legal notice. Not that Parsky seems to give a rat's butt.
Eternal Filthiness of the Adulterous Mind: To be honest, Calbuzz had never heard of (now) ex-Assemblyman Mike Duvall, a Republican from Yorba Linda, until Wednesday morning. But after this and this , and his resignation a few hours later, it's hard to imagine there's anyone left on the planet who hasn't heard of him now. Seriously, you just know that in, oh say, Guinea Bissau or the Republic of Nauru or on Chuuk Island, guys were walking up to their friends all day and saying, "Mike Duvall," and then both of them would fall down in the street and laugh uncontrollably.
We'll leave it to others to draw the great moral lessons implicit in the NFW tale of a dumbass holy roller, family values, fat lying tub of goo who brags over an open mike about cheating with kinky sex, not only on his wife but also on his mistress, in favor of noting that no matter what he does or where he goes the rest of his life, Mike Duvall will be a walking double entendre:
Take for example, this lede on a recent Capitol Weekly piece about him:
"If you want to know what issues are important to Assemblyman Mike Duvall, R-Brea, just look at what he did the other weekend."
Or this from his soon-to-be shut down web site:
"In February 2009 Assemblyman Duvall was named "Legislator of the Year for 2008″ by the California Attractions and Parks Association for his opposition to Governor Schwarzenegger's proposed 'fun tax.'"
You also gotta wonder whether Chapman University wants its plaque back:
"Chapman University awarded Duvall the Ethics in America Award in 2000 for his 'demonstration of the highest standards of ethical integrity.'"
And finally this: The hearing room where Duvall let his potty mouth run wild is festooned with a large color portrait of the late, great Jesse Unruh, a man of great appetites who famously said of lobbyists, "If you can't take their money, drink their liquor, fuck their women, and then come in here the next day and vote against them, you don't belong here."
Of course, that was in the days before women were lobbyists.
PS: Get this, from Duvall's web site: "I want to make it clear that my decision to resign is in no way an admission that I had an affair or affairs. My offense was engaging in inappropriate story-telling and I regret my language and choice of words. The resulting media coverage was proving to be an unneeded distraction to my colleagues and I resigned in the hope that my decision would allow them to return to the business of the state."
Tags: business net receipts tax, Capitol Weekly, Jeese Unruh, Michael Boskin, Mike Duvall, oil drilling, sleight-of-hand, Tranquillon Ridge
Posted in Arnold Schwarzenegger, California Politics, California Resources, Gerald Parsky, Parsky Commission, Pedro Nava, State Lands Commission, Susan Kennedy | 7 Comments »
Red-Blue Clash Emerges in 21st Century Commission
The Commission on the 21st Century Economy, headed by Schwarzenegger pal and Republican bigwig Gerald Parsky, has been developing a plan to overhaul California's tax system that includes flattening personal income tax rates and broadening the sales tax, as loyal Calbuzz readers know.
Instead of achieving the consensus sought by Parsky, however, the commission faces an ideological (and factual) conflict at its meeting in San Francisco on Thursday, as liberal members are now proposing an alternative plan. Their draft proposal, among other things, rejects as too regressive a flat income tax system, and also suggests amendments to Proposition 13.
The commission's Blue Wing (as in blue state/red state) is questioning underlying assumptions of the Red Wing flat-taxers, like: 1) Is California actually unfriendly to business? 2) Are jobs and businesses actually fleeing California? 3) Does improving competitiveness demand elimination of the progressive tax system and the sales tax?
The introduction of the Blue Plan has already raised partisan political hackles between appointees of the Republican governor and those of Democratic legislative leaders.
Former GOP Assembly Speaker Curt Pringle, in a letter obtained by Calbuzz, accused former Democratic Assemblyman Fred Keeley, one of the leaders of the liberal wing of "crafting a plan in private" and end running commission procedures with "an 11th hour presentation."
"Why shouldn't every commissioner gather their respective philosophical mates and assemble and submit competing plans in the weeks and even the months ahead," Pringle said.
But Keeley, now the Treasurer of Santa Cruz County, insisted he has honored commission procedures, and has been raising similar issues in meetings since March.
The conservative Red Wing, led by Parsky and Michael Boskin of Stanford, previously had hoped that their plan was on track for recommendations to flatten and simplify the income tax, eliminate the business tax and create a net receipts tax, like a European value added tax, to replace the sales tax.
But after the elements of that idea – which became known as the Red Plan — were well-publicized and thoroughly examined by the commission's staff, the liberal wing on the commission, led by Keeley and Christopher Edley, dean of the Boalt Hall School of Law, came forth with an alternate Blue Plan.
Still in draft form, their plan would:
— Require that all state revenues that are 5% or higher than Department of Finance estimates be placed in a rainy day reserve fund.
— Make no change to personal income taxes, but reallocate capital gains tax revenue, with one-third going to the General Fund; one-third to debt and retirement fund payments; and one-third to the reserve fund
— Reduce the sales tax by 2% and expand it to cover, not just goods, but also a wide variety of services.
— Reduce the rate of the corporations tax, but broaden its base by restricting deductions on business losses and rolling back tax breaks for companies that operate outside California
— Subject the controversial business net receipts, or value-added, tax to further study.
— Adopt a pollution surtax on carbon-based fuels
— Amend Prop. 13 elements of the California Constitution to allow local governments (cities and counties) to increase existing local sales tax by up to 1.50% (or any .25% fraction thereof) by a majority vote of its electorate, instead of the currently required two-thirds,.
— Amend Prop. 13 to change the non-residential property tax rate from 1% to 1.50%, effective upon change of ownership, essentially establishing a "split roll" assessment system.
The Blues also would require display of all tax expenditures – special tax breaks, credits, deductions and exemptions – in the governor's budget, and require them to sunset in no more than five years.
At this Thursday's meeting at UCSF, the Blue Wing will ask that their proposals be given the same thorough analytical treatment that the Red Wing proposals have received and then be considered at the July 22nd meeting at UCLA.
The Blue Wing rebellion was first reported by Dan Walters of the Sac B-, who suggested the commission is headed for deadlock. That's certainly possible, given the stark differences in world view commissioners have, but Keeley, for one, isn't so sure.
He believes the commission can come up with a compromise, Purple Plan that combines elements of the two approaches.
It wouldn't include a flat tax on income, but it might mitigate some of the brackets and could easily address capital gains. And while it might not replace the sales tax with a net receipts tax (which Michigan has had trouble predicting), it might lower the sales tax rate and broaden its application to services, as many other states have done.
"It depends how deeply people want to hold onto their ideology versus producing a game-changing product," Keeley said.
Tags: Blue Plan, business net receipts tax, California Commission on the 21st Century Economy, Christopher Edley, corporations tax, Fred Keeley, General Fund, Michael Boskin, Purple Plan, Red Plan, reserve fund, retirement fund, sales tax, two-thirds vote, value added tax
Posted in California Democratic Party, California Economy, California Politics, California Republican Party, California State Budget, Dan Walters, Department of Finance, Gerald Parsky, Proposition 13 | 4 Comments »