Prop S Proponents' Three Big
Lies
By Walter Moore,
Candidate for Mayor of Los Angeles
Mayor Villaraigosa, the City Council, and the public
relations consultants they hired to fool you into voting for Prop S rely on
three big lies. Here are the big three -- straight from proponents'
website -- and the true facts.
Lie No. 1: "Does Prop S raise taxes? No. Proposition S
reduces the utility tax from 10% to 9%."
If Prop S were really a tax cut, Villaraigosa and the City
Council could have and should have adopted it on their own without blowing $5.1
million of your tax dollars to conduct the special election. You see, City
Hall does not need voters' approval to REDUCE a tax. The Mayor and City
Council are free at any time to reduce or repeal city taxes on their own.
Rather, California's Constitution (Prop 218) requires voters'
approval only if City Hall wants to "impose, extend or increase any general
tax." Villaraigosa and the City Council are seeking your approval because
Prop S is a tax HIKE. They've gotten caught repeatedly violating Prop 218
(e.g., the cell phone tax hike in 2003 and the extension of land-line phone tax
in January 2007), so this time they decided to try fooling you into voting for a
tax hike by calling it a tax cut.
Lie No. 2: "Prop S is fairer than the current tax because it
will apply equally to all telephone communications technologies, not just the
residents and small businesses that currently pay"
Prop S is not "fair," does not "apply equally." Plus,
it actually charges residents and small business more than certain big
businesses. Prop S would impose a 9% tax on you, but only 5% on
telemarketing agencies. And Prop S would exempt the L.A. Times, Hoy, La
Opinion and local news radio stations from any tax on cell phones, wireless and
internet services. Does it sound "fair" and "equal" to charge you 9%, but
telemarketers 5% and big companies like the L.A. Times nothing?
Lie No. 3: "Proposition S is vital for emergency
response. It ensures that we have the firefighters and paramedics to handle 911
calls quickly and professionally."
Wait a minute! Didn't these same people just finish
telling us that Prop S would reduce taxes? How, then, can a reduction of
taxes be "vital for emergency response?" The answer, of course, is that
they're lying about Prop S being a tax cut. I guess the idea is that some
voters, a la Jerry Maguire, will say "you had me at 'tax cut,'" and vote "yes"
without reading the rest of the materials
In any event, the Prop S proponents are lying about Prop S
being vital for, or ensuring the provision of, emergency services. Prop S
contains absolutely no language requiring that any revenues be used for 911,
firefighters, police, or anything else. If Prop S contained such language,
it would be a "special tax" rather than a "general tax," and City Hall would
have to fool two-thirds of the voters into approving it, rather than a bare
majority.
In fact, Prop S would let City Hall blow the tax money on
whatever they want, including, for example, more subsidies for the downtown
developers who contribute to their campaigns.
The City already takes in more revenues than ever in its
history -- $6.7 billion per year, up 27% from the 2004-05 budget. The City
could discontinue all phone and cell phone taxes, and hire an additional
1000 police officers, and the remaining revenues would still be 21% higher
than in 2004-05. Are your annual revenues up 21% since
2004-05?
City Hall routinely squanders your tax money, and can't be
trusted with more. Don't take my word for it. Here's what the City
Controller recently said: "we shouldn't think of asking taxpayers
for more money until we get our house in order."
On October 16, 2007, moreover, the City Administrative
Officer sent Villaraigosa and the City Council a memo proposing a schedule of
budget cuts to make up for loss of the $270 million of phone tax revenues.
Guess what? If you omit any cuts for the police and fire departments, her
proposed cuts still exceed $300 million.
Ending the phone tax may require us to stop subsidizing the
annual Polish Film Festival, but we could still hire as many police as we want.
So Prop S Would Increase Taxes. So What?
Without taxes, we would have no governmental services at
all. No police. No fire department. No bronze plaques
commemorating the Mayor's announcement that he wants 1 million trees
planted. Okay, bad, but true, example.
Since we must pay for the services we want, what's wrong with
increasing the taxes we pay on land-line phones, cell phones, DSL lines, VoIP,
T-1 lines and every other form of electronic communication?
What's wrong is that our taxes here in the City of L.A. are
already much higher than in other cities, our money is being squandered, and our
high taxes are scaring away jobs. I've already written quite a bit about
the waste at City Hall. By now you know the City Controller has said City
Hall should not even think about asking for a tax hike until they get their
"house in order." So today let's focus instead on how taxes and income in
our city compare to other cities:
Did you know that Beverly Hills, Thousand Oaks and San Diego
have no phone tax? The same goes for Atlanta, Boston, and
Philadelphia. As for cities that do impose phone taxes, New York's tax is
just 2.4%; Long Beach and Las Vegas charge 5%; and Burbank, Portland and Culver
City charge 7%. So why must we pay 9%?
Unlike our neighboring cities in the county of L.A.,
moreover, our city imposes a business income tax that puts a $477 million burden
on the city's employers -- a burden in addition to federal and state income tax,
sales tax, property tax and all the other taxes. Result? People who have a
choice open business and hire employees in cities other than ours, so we lose
out on good jobs. When is the last time you heard of anyone opening a new
factory here, or moving their corporate headquarters here?
The median income of people who live in the city of L.A. is
lower than the median income of people who live in the county: $44,445 vs.
$51,315 in 2006. And the gap has been growing bigger during the past few
years: a 15.5% gap in 2006, up from 13% in 2004. You can't build a
successful economy based on people selling oranges from traffic medians.
And get this: according to the Mayor's own budget, the
median "effective buying income" of our city's residents, i.e., their after- tax
income, has actually dropped from $37,321 in 2001, to $34,480 in
2005.
The median after-tax income figure state-wide, by the way, was $43,915 -- 27%
higher than in our city.
Prop S would make our city an even less desirable place for
businesses to hire people. We can't afford that. We need to attract
good jobs, not scare them away. We need to make L.A. a great place to do
business, because unless and until we do, all the good jobs will move elsewhere.
Bottom line: We don't need a new tax. We need a
new mayor. And, until then, we need more ads to educate our fellow voters
about Prop S. So chip in, would you? They don't give those ads away,
and the Prop S proponents have $1.8 million in special interest money to throw
at voters. Contribute to my campaign today at
www.WalterMooreForMayor.com.
