I grew up in California during one of its biggest booms in economic growth. The good times were rolling, and the Sacramento Pols were doing their best to spend every dollar before it even hit their coffers.
During one election before I could vote, I remember my mom debating how she should vote on some of the proposals. There was a huge list of spending bills, all of them for good things, but all of them costing significant amounts of money going well into the future. “I guess it’s good that people feel confident enough they think we can spend money on these things,” I remember her telling me, “but that’s also a whole lotta debt.” (I definitely paraphrased there. It was more profound when it came from the source)
All of the spending bills passed.
A year or two later, the economy took a nose dive in Dot Com bust. Then, it took an even bigger nose dive with the housing bust, which it’s still trying to come back from. To say the state’s budget is in a precarious situation is probably giving it too much credit. If they’re not careful, they’re bound to face an even greater reckoning than they already have.
On that budget front, Gov. Jerry Brown is in a bit of hot water. He just vetoed a bill that would remove sale tax from tampons (and diapers), and some people are quite disappointed. The current law, they say, is unfair since it’s a tax on a product only used by women.
At a quick glance, there’s certainly something to that argument. Tampons are used mostly by women–though I’m sure a quick Google search will reveal other creative uses for them that men could do–so a sales tax on Tampons will certainly hurt women more.
Let me rephrase that. It will hurt women who do not co-mingle their funds with men more than it’ll hurt men who do not co-mingle their funds with women. Anyone who is married in a traditional male-female unit with a joint checking account will find that the sales tax on tampons hurt both the man and woman in that relationship equally. I can say with some confidence that the amount of money my wife spends on feminine hygiene products hurts me just as much as it hurts her, since it all comes out of our combined little pot.
But I digress. My point isn’t to debate the merits of their argument, it’s that throwing morality into taxes makes things messy.
Let’s look at a few other examples. Cigarette taxes and other sin taxes are designed to curb the use of certain items, yet simultaneously governments have come to rely on revenue from those “sins”. The multitude of proposed Carbon Taxes are designed specifically to lower the use of greenhouse gases, yet would certainly become another much used source or government revenue AND most likely hurt the poor the most. Food taxes tax everyone for the sin of eating, clothing taxes unfairly penalize those who have the audacity to wear clothes, progressive income taxes penalize you for trying to get ahead, etc. etc. etc., ad nauseum.
We could probably point to every tax law and come up with a reason why it isn’t “fair.” That’s because taxes will always have a negative effect on someone–it’s the nature of the beast. There’s no way to do taxes without hurting some people more than others. On the flip side, the more we narrow who we’re taxing to try to put the burden on those who can afford it (e.g. if we could find a way to tax only rich white men), it makes our stream of tax revenue more volatile, which puts our governments at the whims of minute economic booms and busts.
Our goal should be to try to raise what revenue we need with the least damaging economic consequences, because we’re never, ever going to be able to create a truly fair, stable tax system.
Is the tampon tax the best way to do it? I don’t know. The creators of the bill don’t appear to know either. They can’t agree on what kind of taxes they like, they just know they don’t like the current one. Which would be fine, if they (and their predecessors) hadn’t passed through a whole bunch of spending bills they now can’t afford without the money from sales taxes on tampons.
I don’t blame Jerry Brown for vetoing this bill. If I were in his position, I probably would have done the same thing. Except, unlike him, I would have sent back a message saying, “That’s fine that you don’t like our current tax regime. I’ll happily repeal this one once you send me a better one that will pay for all those programs you insisted on implementing without putting our economic future at risk.”
Or, you know, something along those lines.