Tax-hike austerity failing in California, just like Europe

I am having problems comprehending this Bloomberg headline: “Brown Tax Increase Gains Urgency as Deficit Rises to $16 Billion.” The story is even more puzzling:

California Governor Jerry Brown bet that a nascent financial recovery would lift the world’s ninth-largest economy enough to whittle down a $9.2 billion deficit. Instead, the gap has widened to $16 billion.

Today the 74-year-old Democrat will unveil his revised budget and explain what additional spending must be cut. Tax collections have run $3.5 billion below what he calculated four months ago. Spending has grown $2 billion above projections... The new deficit estimate increases the urgency of the governor’s plans to increase income taxes on some earners to the highest in the nation, and boost sales levies that are now more than any other state.

The plan would temporarily raise the statewide sales tax, already the highest in the U.S., to 7.5 percent from 7.25 percent. It would also boost rates on income starting at $250,000. Those making $1 million or more, now taxed at 10.3 percent, would pay 13.3 percent, the most of any state.

Wait, taxes are rising and revenues are falling. So obviously the solution is even more taxes? Who’s running the show over there, the IMF? So the state with highest sales tax in America would also have the highest income tax in America?



As it is, California ranks 48th in the Tax Foundation’s State Business Tax Climate Index. The California Dream has become the Golden State Nightmare.