Yet Another Giveaway

Wonderful bit of information enclosed in the two paragraph article, Panel Endorses Plan to Simplify Business Taxes. The City of Los Angeles is planning to cut business taxes by 4% next year. They also plan to adjust the business tax system, which will likely lead to more tax cuts for businesses in the affected categories.

And what is the reason for this change? Because revenue projections have been met.

There are a couple issues here. First of all, this is the primary basis of the supposed budget issues of the last half decade. In the face of higher income, cities and counties cut business taxes in the 90s and then took a hit when business income dropped because of the dot-bomb. I don't remember hearing that those taxes were increased as a result of the changing economic situation. Instead, the cumulative effect over time is to shift more and more of the tax burden onto tax sources that derive more disproportionately from working people. It also becomes an excuse to cut more and more public services from the very people who are bearing more of the taxes.

The other thing is that there is no shortage of needs. Instead of cutting taxes (which no legitimate economist has shown actually increases jobs – usually the opposite) it would make sense to either save it somehow or spend it on important projects. The Mayor has played up public transit a lot, that needs money. Public health has taken a hit, that needs money. Public schools, that always needs money. The City Councils actions speak louder than words.