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To: rockinqsranch

The fiscal benefits of spending caps so far outweigh the negatives of the tax increases that any prudent and fiscally responsible person would jump at this. Assuming of course you can make it stick and therein lies the problem. I’d say it’s the Dems who might fall into the trap.


14 posted on 01/22/2009 9:48:45 AM PST by Bogeygolfer
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To: Bogeygolfer
Bogeygolfer said: "The fiscal benefits of spending caps ..."

Kalifornia teeters on the edge of bankruptcy right now. I think I saw a headline suggesting that their borrowing costs will be going up due to a downgrade of the quality of their debt. I have seen headlines suggesting that tax refunds would be in the form of IOUs instead of money.

What this means is that Kalifornia is ALREADY experiencing a spending cap. There is no need for Republicans to give up anything. The necessity for reigning in spending is about to become crystal clear.

Consider the effect of issuing IOUs for tax refunds. There will very soon be a rush to increase deductions such that the typical taxpayer will owe money at tax time instead of expecting a refund. This will cause the "unintended consequence" of an immediate decrease in Kalifornia's cash flow.

People respond one way when they read in their local newspapers of the difficulties the state faces. They will react in a totally different way when THEIR MONEY is not forthcoming. That applies whether the money is a tax refund or a government paycheck or a payment for services rendered to the state.

29 posted on 01/22/2009 10:44:15 AM PST by William Tell (RKBA for California (rkba.members.sonic.net) - Volunteer by contacting Dave at rkba@sonic.net)
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