Rent-seeking opponents of repealing the gas tax are getting desperate
There’s an old saying in business: Build a better a mousetrap, and the world will beat a path to your door.
But not everyone builds their success on creating better products or providing better services. There are some that specialize in manipulating the laws and the government as a strategy for increasing profits.
This has sometimes been called “rent seeking,” in the sense that it might apply to a storybook troll under a bridge, collecting “rent” as if he owned the right of way.
There are trolls under the bridges in California this year, and next to the highways. They are the rent seekers who oppose Proposition 6, the grassroots effort to repeal the massive gas and car tax increases signed into law last year. They are engaging in some of the most questionable campaign tactics ever seen in California. These Prop. 6 opponents are making millions of dollars from the massive infusion of taxpayer cash paid by hardworking Californians who need their cars in their daily lives.
First, let’s cover the basics: Proposition 6 does not repeal the entire gas tax — only that portion that pushed us up to just about the highest in the United States. If Proposition 6 passes, California will still have the 5th highest gas tax in the nation. Opponents of Prop. 6 would have voters believe that this level of taxation can’t even keep our existing roads paved, let alone build new highways.
Second, waste, fraud and abuse in California transportation spending is legendary. The nonpartisan Legislative Analyst’s Office says needless overstaffing at Caltrans is costing taxpayers billions. For what California is spending on the nation’s biggest boondoggle, high-speed rail, we could easily pave Interstate 5 from San Ysidro to the Oregon border.
Third, if transportation is so important, why can’t we spend some of the state’s $9 billion-dollar surplus for one-time expenditures? Gov. Brown’s father did that when he was governor.
Bottom line is that this is not about transportation or the need to fix our roads. No one disputes that our roads are in terrible shape. But credible plans to address this critical need without raising taxes can’t even get a hearing in the legislature. Why?
The reason is simple. This is about transferring money — and lots of it — from hardworking California taxpayers to special interests. Big business and big labor, with a major push from Gov. Brown, are the ultimate rent seekers as labor (both private-sector unions and public-sector unions) and big construction companies and others associated with taxpayer-financed projects see a great opportunity to cash in. Brown and his band of rent seekers will probably spend $40 million to defeat Proposition 6, and why not? If the payoff to your bottom line is in the tens of billions of dollars, that’s a great ROI (Return on Investment).
But the rent seekers have a problem. When given balanced information, voters are inclined to support Prop. 6 by healthy margins. The unpopularity of last year’s tax hikes was reflected in the recall of Sen. Josh Newman, D-Fullerton, an unrepentant tax-and-spend politician whose support for the tax hikes led to his downfall.
The rent seekers know they are in trouble, which is why they have stooped to questionable campaign tactics. In addition to colluding with Caltrans to place big signs on the highways reading “Your SB1 dollars at work” in locations where no work is being done, a recent incident reveals a heightened level of desperation.
Last Tuesday, a Caltrans work crew was caught stopping cars (and creating a traffic jam) along a major highway in San Diego County where Caltrans-funded work was being performed by a private company, Manhole Adjusting Inc. (aka “rent seeker”), under the watch of a Caltrans supervisor in a Caltrans-branded truck. Photos captured the Caltrans work crew member actually handing out fliers and captured the content of the fliers, which contained “express advocacy” statements such as “Vote NO on Prop 6.” The work crew members were recorded on video admitting that they were told to pass out the fliers by a Caltrans supervisor.
The use of taxpayer dollars for political advocacy is strictly prohibited by law. But when your potential ROI is in the billions of dollars, breaking the law is apparently worth it. Nonetheless, California voters probably have a different take.
Jon Coupal is president of the Howard Jarvis Taxpayers Association.