May 2004 Universal City North Hollywood Chamber of Commerce Government Affairs Committee Column in its monthly Dispatch Newsletter


The Dispatch Newsletter


Misleading Polls



Before the election last March, some polls indicated that a majority of the public would not mind taxes being increased in order to balance the State of California ís budget. Those tax increases would be on alcoholic beverages, tobacco products, and high income earners. A true indication of the publicís sentiment on taxes was the result of Proposition 56, which would have changed from 66 2/3 % to 55% the legislative votes needed to pass tax increases. Knowing what would happen if it passed, the public severely trounced Proposition 56.


But some people never learn. A poll that was published in the April 14, 2004 Daily News Business section indicated that by nearly a 2-1 margin, Americans prefer balancing the nationís budget over tax cuts. But that becomes more understandable when you realize that the bottom 50% pay less than 4% of federal personal income tax, and the bottom 75% pay only 16.5% of the federal personal income tax. Considering only that tax, itís no wonder people donít care much about having their income tax cut. Particularly after the recent federal tax cuts, thereís not much of it left to be cut. They fail to see how tax rate cuts benefit the economy. Without President Bushís tax cuts, the combination of the recession, which started in 2000, and the September 11, 2001 terrorist attacks would still be depressing the nationís economy.


Opponents of the recent tax cuts prove the more proportionate benefit lower income workers are receiving from those tax cuts. Since they cannot prove otherwise, they now try to combine federal, state, and local taxes into one amount, complaining that lower income people pay a higher percentage of their income on that combination than higher income taxpayers. It would be very interesting to see how that was calculated. Food, from grocery stores, and drugs are exempt from sales tax. Property tax might be a lower percent of affluent taxpayersí income than for lower income homeowners. But residential tenants do not pay property tax. Like other operating costs, property tax does nothing to determine the amount of rent. Only supply and demand (and government meddling) do that. Itís up to the public to complain about excess taxes and regulations.


Attempts of some politicians to increase taxes on the wealthy by increasing taxes on their consumption backfire disastrously. When excise taxes on yachts were increased, sales plummeted and over 25,000 boat building employees lost their jobs. Over regulation of health care and workers compensation in California is chasing an increasing number of employers, and the jobs they generate, out of the state. Over regulation of rental housing has caused a housing shortage. Unfortunately, when their regulations and taxes fail, politicians make the costly mistake of adding more, rather than terminating (and admitting to) their old mistakes.


Itís tragic that many people do not care enough to learn about the issues and vote. By getting actively involved in our UCNH Government Affairs Committee we show the elected officials that certain issues are important to us, and we will persistently remind them. If you do not like the Los Angeles Gross Receipts Tax, please call and write your City Council member about it, and join our committee. Apathy costs too much.


Our success in resolving issues is dependent on the effort and time we invest. Help your business and community by joining the Government Affairs Committee. Representatives of our elected officials regularly attend the Government Affairs meetings to hear what we have to say. We meet at the Chamber of Commerce office ( 11335 Magnolia Blvd. - Ste 2 - D) at 4:00 pm on the second Wednesday of each month.  May 12 will be our next meeting, but the June meeting will be changed to Thursday, June 10, 2004 .


Vic Viereck, Chairman

Government Affairs Committee