Gov. Newsom Pays Unions Back for Recall Rescue
California Governor Gavin Newsom was spared the indignity of being recalled by voters in fall of 2021 by California’s powerful and gilded labor unions, which spent more than $25 million in the recall, according to CalMatters. “That’s more money than Hollywood, California’s tech industry, local Indian tribes, and state real estate players spent in the recall race combined,” the Federalist reported.
The Governor apparently did not forget his end of the ostensible deal, rewarding labor with promises of hundreds of thousands of new members (Fast food workers), as well as signing legislation providing tax credits for the union dues of members.
“The new budget passed by lawmakers in mid-June and signed by Governor Newsom two weeks later will take California’s existing tax deduction for union dues payments and turn it into a tax credit capped at 33% of dues paid,” Patrick Gleason, Vice President of State Affairs at Americans for Tax Reform, said in Forbes. “Changing the deduction to a credit makes the union tax break more generous and benefits those who don’t itemize or have a tax liability.”
Moves like this should show American voters exactly who Gavin Newsom would show his loyalty should he run for President.
Ballotpedia explains the tax credit:
“Once implemented, the tax credit would be the first of its kind in the U.S. Union dues are currently tax-deductible in California and some other states. (A tax deduction lowers a person’s taxable income before calculating taxes, while a tax credit reduces the amount of tax a person is responsible for paying.)
Gov. Gavin Newsom (D) signed SB 154, the Budget Act of 2022, on June 27. On June 30, Newsom signed SB 189, one of several bills “providing for appropriations related to” the budget act. SB 189 says, “Contingent upon future legislation, including future budget appropriations, and subject to a determination in the spring of 2024 that General Fund money over the multiyear forecasts is available to support ongoing augmentations and actions, the following actions will be prioritized: (1) Implement a tax credit under the Personal Income Tax Law to offset a portion of costs associated with union membership.”
The Federalist reported:
Max Nelson, the director of labor policy at the free-market conservative think tank Freedom Foundation, described the legislation as a “bold” mechanism to expand union membership and empower state-sponsored speech. “Taxpayers are being compelled by the force of state law to pay people to pay unions,” Nelson said.
“Big labor groups may also claim the benefits for themselves, where raising dues to cover the difference offered by the tax credit would enrich union leadership who dictate organizations’ political contributions,”
“We’re kind of into some new frontiers here, which will be interesting for both the courts to grapple with and the states,” Nelson told The Federalist, where Democrats have now embraced a measure to directly fund their own allies who, in turn, will “plow money into progressive electoral politics.”
Patrick Gleason continued:
“The first half of 2022 was a mixed bag for California taxpayers who don’t want the state to inflict more costs upon households and the economy. … Many Californians, however, are unlikely to appreciate the fact that Governor Newsom and state legislators created a new tax credit that is unavailable to 84% of Golden State workers. For all the talk about equity & equality coming from the state’s most powerful politicians, California’s new budget takes the state tax code’s already unequal treatment of workers and worsens it.”
But perhaps Lance Christensen, candidate for State Superintendent of Instruction best reminded us in September 2021 right before the Newsom recall election, what really is at stake in the Golden State besides labor union payoffs:
“California still faces substantial, long-term financing troubles. While Gov. Newsom boasts of the biggest state budget in history, the titanic funds undergirding the budget are one-time revenues that will tank once the Federal Reserve stops printing money and Congress avoids propping up spendthrift programs.”
“If a new governor is elected this month, that person will have one year to whip into shape a bloated, sleepy and sloppy state bureaucracy that has festered in mediocrity for years. And if the Legislature or entrenched bureaucracy is going to resist, the governor should plan for a one-hour presser every day to name names and let the people know why things aren’t changing.”
The unions saved Newsom, so a new governor never got the chance to expose the shady, grubby inner workings of California state government. And now Gov. Newsom is discriminatorily rewarding labor unions and ignoring most everything and everyone else.
Yup. Standard Operating Procedure.