Why Phil Angelides? The Big What If

Phil Angelides provides Democrats and all political Californians perhaps one last conversation about California's future before we are over the edge. Angelides is being pilloried about taxes by media reporters who should know better. The usually-sensible George Skelton of the Times calls him a "hair-trigger taxer on rich folks", and everyday media coverage frames his position as that of "raising taxes."

The framing, however, should be that Angelides will close tax loopholes and return the tax rates to the days of Pete Wilson and Ronald Reagan.

There is a difference -- duh! -- between raising taxes [and fees] and closing tax loopholes granted by past legislatures and governors to wealthy contributors and special interests.

Here is what virtually no one knows because it is never reported -- under state law [Proposition 13], a tax loophole can be created by a majority vote of the Legislature, but it takes a two-thirds vote to close that same loophole.

Why? Because under a law carefully written nearly three decades ago, a tax break for special interests is defined as "reducing taxes" while closing that same break is considered "raising taxes", therefore requiring the higher two-thirds threshold.

When I was in the Senate in the Nineties, there were over $11 billion in this loophole category. It's doubled or tripled by now.

Once a loophole is obtained by the lobbyists, it is rarely if ever examined again. I tried unsuccessfully to require independent reports, on a seven-year basis, to determine if the loopholes had ever resulted in the creation of jobs or any public purpose. I wanted the Legislature to vote on the "loophole budget" periodically, instead of incorporating it into the annual budget process. I failed.

Why should we care about this? Remember the conservative tax strategist Grover Norquist's stated tax reform objective: "to drown the baby in the bathtub." He was talking about the conservative plan to dismantle government as a positive force by strangling popular budget items through permanent tax reductions.

Instead, Angelides would use the revenue from tax reform for long-overdue purposes, like reducing the barriers to higher education for most families, funding K-12, or extending health insurance to all children. Otherwise, California will become more deeply stratified along class and racial lines.

It is stunning that there is no controversy about the massive shift from paying from taxes for the quality of life to paying instead through bonds, which means increasing taxes for the next generation.

Starting with Jimmy Carter and accelerating in the Clinton era, Democrats have been backtracking from the New Deal image of "big spenders." As a result, they have come to be collaborators, or at least enablers, in drowning the baby. if they were hooked before on taxing and spending, they are hooked now by consultants and contributors who warn that taxes are the third rail of politics.

But Democrats could point out that the alternative to taxes is a chronic budget crisis, cutbacks in popular government programs, and sure increases in both present fees and future taxes. The cutting binge certainly means a widening of the racial divide. It guarantees more youth unemployment, gang violence and the ratcheting up of police and prison budgets at the expense of tattoo removal, drug treatment, remedial education, and jobs for inner city youth. More children will be left behind.

The Clinton-Gore project of "reinventing government" was supposed to mean more than tax reduction and public employee layoffs. It could also mean far greater protections of whistle-blowers and the deployment of inspectors-general to really go after waste and fraud in the use of taxpayer dollars on such beneficiaries as Halliburton. It could have meant a democratization of the public sector instead of privatization.

These are the fundamental issues surfacing in public discourse as a byproduct of the Angelides campaign, and they deserve the attention of everyone interested in the political future. There needs to be a massive campaign demanding that the media always make the distinction between increasing taxes and closing tax breaks.

Sure, there are plenty of reasons for discontent with Angelides and the whole gubernatorial race. It marks a further evolution in politics towards the dominance of money over every other factor, a leap towards the mutant species Homo Contributas which even Charles Darwin could not have anticipated. Phil has adapted to the game.

I first knew Phil as an activist supporter of the Campaign for Economic Democracy [CED] back in the Seventies and Eighties. In fact his core campaign team, Cathy Calfo and Bob Mulholland, are veteran leaders of that organization which fought many proud battles, such as Proposition 65 and the shutting down of the nuclear plant at Rancho Seco. Perhaps they noticed that our grass-roots successes depended on the infusion of Hollywood money, and even then the cost of statewide campaigns was becoming prohibitive.

Perhaps as a result of that experience, they became hardened to the reality that money does most of the talking in politics. Perhaps they tried to salvage their early ideals to the extent possible within the engines of money-creation, which usually means the flow of real estate and development funds into politics. Phil was truly a policy-wonk before he caught on to the real nature of politics.

I personally couldn't make the same evolutionary leap, perhaps because my persona was fixed, thankfully, by my street experiences of the Sixties. I tried, but not even a Hollywood marriage could smooth off the rough and radical edges. So I believe we need to take back the political process through radical campaign reform, a movement on the outside that arouses friends on the inside. But I don't think my old friends have gone over the dark side of the Sith -- the model for that sad transformation is Susan Kennedy, a former CED and lesbian activist turned Democratic Party organizer turned chief-of-staff for Arnold...

The desire for political power is all-consuming, however, and the most liberal victims' advocates eventually become tacit executioners. That could be the fate of the entire "Jerry Brown generation" of Democrats now holding or seeking high office. Worse, already a whole new generation of Democratic activists is internalizing the poisonous idea that "grass roots" means such initiatives as holding a "low-ticket" fundraiser.

The only force that can dilute or prevent this attraction to Machiavellian Power is the rank-and-file of the Democratic Party, the Greens, the independents, all those whose passionate interest can sometimes overwhelm special interests. If the residual liberalism of Phil Angelides, expressed in his stand on tax loopholes, even connects with the passionate power of the people -- a big what if -- political life might become interesting again. After all, the "what ifs" are what great campaigns are all about.