Taxpayers Are Saying "No". Legislatures Aren't Listening...Yet.

Is the vote putting the kibosh on out of control spending by the state of California merely the first shot in a nationwide taxpayer revolt? I'd have to say the average taxpayer has just about had it with both federal and state governments looking at citizens as nothing but an ATM to be tapped at will.

We've seen tax hikes in New York that will do nothing but make New Yorkers poorer while still failing to fill the revenue gap created by state and municipal governments spending more than the citizens can afford. The same thing is happening or will happen in a number of other states as well, including New Jersey, Connecticut, and, unfortunately, my home state of New Hampshire, just to name a few.

In New Hampshire we have a state legislature that just can't say no to new spending, even in light of an existing budget deficit they have failed to deal with, and an even bigger one projected for the upcoming biennial budget (New Hampshire operates under a two year budget). The last budget increased state spending by 17.5% while fudging the projected revenue figures to make it look as if the state would collect enough to pay for such a huge spending increase. The state ended up taking in about $400 million less than projected. That was not a surprise to most of us in the state as we knew the legislature cooked the books. It didn't help that the governor went along with the charade.

Now, like many other states, the legislature has decided it's a great time to boost the state budget by an additional 13% even though they know the revenues won't be there to pay for it. Even the proposed tax hikes (which will put us back in the same situation that existed back in the late 60's/early 70's when New Hampshire business, capital gains, and other taxes made the state seem hostile to business), won't come close to meeting revenue projections, which means they'll need to raise even more taxes, which in turn will wreck what has become to be known as the New Hampshire Advantage. The Democrat majority legislature will reimpose the very taxes that crippled the state economy back in the 50's and 60's, all while telling us it's necessary to fund state operations. It doesn't help that the governor doesn't have the will to tell the legislature 'no'. Instead he will 'reluctantly' sign the budget, sending the state down the tax-and-spend rathole that has crippled so many other states.

One merely needs to look just south of the border into Massachusetts to see the effects of out of control spending and taxation. Back in the 70's and 80's Massachusetts was derisively known as Taxachusetts. That sobriquet has returned with a vengeance in light of the tax and fee hikes passed or proposed during the present legislative session.

Too many other states are doing the same thing. You'd think the first thing they'd do is tighten their figurative belts, trim costs, cut back on spending and, if needed, lay off workers. But that seems to be the last resort for some. California is caught in a Catch-22 where if they lay off state (union) workers the federal government will cut off billions in stimulus funds promised to the state in way of punishment. Other states have been effectively taken over by state and municipal workers unions, making it impossible to perform layoffs. The unions act as if it's a crime to lay off any of their members. I don't know of any union contracts that guarantee employment for life. But the unions certainly seem to think so.

One bright spot for California because of the vote: If the state goes bankrupt, the union contracts with state workers unions will be null and void, meaning the state can then shed itself of workers it can no longer afford. California will be forced to become more efficient and more fiscally conservative. The days of want-to-haves being seen as need-to-haves will be gone.

Now if only the New Hampshire legislature and the US Congress could be made to see the difference.

Like that's going to happen.

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