JOHN FUND'S POLITICAL DIARY
The Power of the Pledge
Merely saying "no" to tax hikes isn't enough.
Thursday, August 21, 2003 12:01 a.m. EDT
Arnold Schwarzenegger has moved to quiet grumbling on the right. He showed he can think quickly on his feet and that he will run as an economic conservative. Yesterday he summed up his position by saying: "The politicians have overspent, overtaxed and overregulated." And on Friday, he will finally break out of his comfortable Los Angeles cocoon and begin door-to-door campaigning.
But lingering questions remain. Mr. Schwarzenegger gave a firm answer on whether he would raise taxes: "Does this mean I am willing to raise taxes. No." But then he brushed aside the notion of taking a pledge to not sign a state budget that included a net tax increase. Mr. Schwarzenegger said he had learned "never to say never" and there's always a chance that a terrorist attack might create unusual budget demands.
That glib answer will not satisfy some conservatives, who have seen too many candidates proclaim opposition to higher taxes only raise taxes once in office as a "last resort," once they realized how hard it is to cut spending.
Steve Moore, president of the free-market Club for Growth, said he is "quite enthusiastic" about Mr. Schwarzenegger's economic agenda, including his call for litigation reform and reducing undue burdens on business. "The one caveat I have is that he is shying away from a pledge not to raise taxes. That would close the circle with economic conservatives." Americans for Tax Reform started the antitax pledge in 1986 and it has since become a requirement for any candidate who claims to favor smaller government. Today, 90% of House Republicans and 80% of Senate Republicans have taken the pledge. So has George W. Bush. The other two serious Republicans in the race, Tom McClintock and Bill Simon, have taken the antitax pledge. Mr. Schwarzenegger will be the odd man out, if he doesn't move to address the pledge issue.
Grover Norquist, the head of ATR, says he has heard every excuse imaginable from candidates who don't want to take the pledge. Conservatives shouldn't listen to any of them, he says. As for Arnold's terrorism excuse, it's bogus too. If there was a terrorist attack, the federal government would almost certainly pick up the tab, as it did after the Sept. 11 attacks.
"The disaster argument doesn't track because if something horrible happens and leaves the state's residents poorer it makes no sense to increase their misery by raising taxes," Mr. Norquist said. "It is the economic equivalent of putting leeches on a patient that is hemorrhaging. It will only hurt."
Mr. Schwarzenegger already has allowed himself some running room. If elected, he's promised to issue an executive order repealing Gray Davis's tripling of car registration fees. That would give Mr. Schwarzenegger some negotiating room on the tax issue with the overwhelmingly Democratic legislature. By cutting car registration fees, he could increase other taxes and still keep the antitax pledge.
California's overspending has been so egregious, former state assembly Republican leader Bob Naylor said, that a new Republican governor would likely have only a few options. He could take a budget plan--that includes spending cuts--directly to the people in a referendum. Or, a new governor could cut a deal with the Democrats who control the legislature. That deal could impose an increase in the sales tax (sunsetted after, say, three years) as well as cut spending. But it would also have to include litigation and worker's compensation reform as well as future tax cuts.
Conservative budget analysts say that deal could be constructed so as not to violate the American for Tax Reform pledge--all that would be required is to, say, include cuts in the state's marginal income tax rates in years four to seven. "The key is that there not be a net increase in the overall burden of taxation," says Mr. Norquist. "If Mr. Schwarzenegger means it when he says Californians are overtaxed, then he must not increase their overall tax burden. Anything else will encourage the legislature to stall and wait for a new governor to buckle on that overarching issue."
Mr. Schwarzenegger already has shown his willingness to play hardball with the legislature. Yesterday, he promised to call a special legislative session to address the state's antibusiness political environment. He has also told friends that if the legislature balked on his budget proposals--without offering anything constructive--he would visit the districts of key legislators. There, the Terminator would turn up the political heat by holding rallies in support of his budget. He could even hold fundraisers for opponents to run against offending legislators."For the first few months the legislature will be scared to death of him," says Mr. Naylor. "So he has to move quickly." Taking the antitax pledge may be particularly smart politics. Some Democrats almost certainly will push for tax increases as a way to undermine the new governor's connection with voters. Signing the pledge now would give Mr. Schwarzenegger the upper hand by giving his antitax stand a mandate from the people. "There is very little pressure on people who take the antitax pledge if liberals believe the signer means it," Mr. Norquist said. "If they don't sign, the pressure is often unbearable."
URL:http://www.opinionjournal.com/diary/?id=110003913 |
