California Gets It Wrong Again

Is it just me or is the state of California doing everything it can to ensure its total financial collapse will take place? Nope, it isn't me.

It seems every measure the California legislature is taking will have the effect of increasing support of the state employees unions pay, benefits, and pensions while increasing the burden on the taxpayers, or decreasing its already falling tax revenues, or both.

The latest stupid, rent-seeking action? Shutting down Amazon's Associate program in California by trying to force Amazon to collect California sales taxes (even though the move is illegal). The amount of sales taxes collected by this move? Zero The estimated amount of income tax revenues lost with the shutdown of the Amazon program? $151 million.

As Bill Quick, a now former Amazon Associate, writes:

Did I mention that these people are leftists, greedheads, and wreckers? Let me add that they are also corrupt bribe-takers on a massive scale. They pushed this law through, and are more than happy to see the Amazon Associates program permanently shut down, because that is the goal the real backers of this law were after in the first place. It has nothing to do with sales tax collections. It is, in its entirety, designed to use the government as a club to shut down Amazon’s Associate Program in the biggest states in the country.

How so?

Big companies like Wal-Mart, (an out of state corporations itself) who have associate programs that are much less effective at driving sales than the Amazon Associate program is, can’t handle that competition head on by beefing up their own programs. Or at least they don’t want to. So what these sponsors were really after was not to collect additional sales tax for California, but to shut down the competition in the state. They got what they wanted. The politicians behind this bill will get what they want - more money and support (bribes) from companies like Wal-Mart. And the state will get nothing, in fact, will lose money.

But of course the big drive now is to somehow make Amazon the villain in all this. And too many people are buying the propaganda. Sad.

So while the aim of the legislation appeared to be to collect sales taxes, it was really a rent-seeking move by Amazon's competition? This sounds a little paranoid. But unfortunately, it is likely true. There's certainly enough precedent for such a move, and we've seen it at the federal level, particularly since “The One” Term Wonder took up residence at 1600 Pennsylvania Avenue.

Should this type of shenanigans continue in the Golden State, the motivation for businesses and residents to leave California will rise and the stream of businesses and workers already leaving will turn into a flood. That ought to help the state's bottom line. NOT.