Whitman would save millions from her tax cut

Continuing a meme that Democratic gubernatorial nominee Jerry Brown started during the debate last week, his supporters released a memo today estimating that Republican nominee Meg Whitman would see personal savings of between $8.2 million and $41.2 million over a four-year gubernatorial term if she keeps her promise to eliminate the state’s capital gains tax.

Brown had asked Whitman – the billionaire former eBay CEO – during their Oct. 12 debate at Dominican University of California in San Rafael how much her tax plan would benefit her own finances; she didn’t answer, and hasn’t released an estimate since. Today’s memo was prepared and released by California Tax Reform Association Executive Director Lenny Goldberg.

Whitman says eliminating the tax will stimulate investment, leading to job creation. Democrats say it would blow an even bigger hole in the already-shredded state budget while mostly benefiting the very rich, with no guarantee of an economic benefit.

“Meg Whitman has millions to gain, but we have everything else to lose,” California Labor Federation Executive Secretary-Treasurer Art Pulaski told reporters on a conference call.

He said eliminating the capital gains tax would reduce state revenues by $4.5 billion per year, with each dollar lost bringing “a decrease in the quality of life for Californians:” failing schools, reduced college admissions, shortages of police and firefighters, crumbling infrastructure, struggling seniors and disabled, and reduced or no child care, all without creating jobs.

Pulaski and Goldberg repeated their calls for Whitman to release her tax records so estimates such as theirs wouldn’t be necessary.

State Sen. Leland Yee, D-San Francisco, agreed the memo underscores Democrats’ contention that Whitman offers “a one-sided solution to our budget problem – it is to enrich the rich and cut from children and the poor.”

California saw faster economic growth than the rest of the nation from 2000 through 2007 even with the capital gains tax in place, said University of California, Berkeley Economics Professor Michael Reich, while other states such as Texas have outperformed California in recovering from this recession because they weren’t as hard hit by foreclosures.

Whitman’s campaign issued a statement saying leading economists are on her side.

“Having closely studied the issue, Meg Whitman’s proposal to eliminate the capital gains tax in California will spur investment and create jobs. As a whole, Meg’s economic policies of streamlining regulation and implementing targeted tax cuts are crucial in getting our economy moving again and getting Californians back to work,” Hoover Institute Senior Fellow John Taylor – an economic advisor to governors Arnold Schwarzenegger and Pete Wilson, as well as to presidents Gerald Ford and George H.W. Bush – said in the campaign’s statement.

But Reich said California investors have diversified national and international portfolios, and so their reinvestment wouldn’t benefit the Golden State’s economy all that much. He also said millionaires haven’t been leaving California in any measurable way due to taxes, and so it’s unlikely any would return if the tax was eliminated.

Josh Richman

Josh Richman covers state and national politics for the Bay Area News Group. A New York City native, he earned a bachelor’s degree in journalism from the University of Missouri and reported for the Express-Times of Easton, Pa. for five years before coming to the Oakland Tribune and ANG Newspapers in 1997. He is a frequent guest on KQED Channel 9’s “This Week in Northern California;” a proud father; an Eagle Scout; a somewhat skilled player of low-stakes poker; a rather good cook; a firm believer in the use of semicolons; and an unabashed political junkie who will never, EVER seek elected office.

  • RR, Uninvited Columnist

    I’ll be danged! That Meg-a-bucks is bein’ helped by them comp-ly-kated tax laws! Downtown Jerry Brown, Man o’Renown, wants ta take frum da Rich and give $$$ to da Poor. I’m all over dat! If’n I cants be richie rich, it ain’t fair fer nobody to be rich!

  • Elwood

    Who would spend $140 million for the prospect of saving $8-41 million?

    “it is to enrich the rich and cut from children and the poor” –Leland Yee

    Proving once again that Yee is an idiot. As if any more proof were needed.

  • Montana

    Nutmeg will lose as will Carly the tremendous failure of HP, don’t come crying to me if the GOP, keeps finding weak candidates, its like Mccain with the half-term Governor Palin all over again, what a joke that was, I mean comedian, talk show guest, commentator, now her new BS on the (of all places) The learning Channel, jack of all trades, master of none.

    June 14, 2010, The New York Times, Ebay paid out $200,000 because Nutmeg assaulted an employee, so it’s not the first time she has mistreated an employee.

    “The Whitman campaign issued a statement signed by Ms. Whitman that described Ms. Young Mi Kim as a “respected colleague and valuable asset to the company. In any high-pressure working environment, tensions can surface,” the statement said. ” Not quite a denial, what a fool she is.


    I must say one thing about Nutmeg is that she is a good parrot:

  • Sara and Meg WHO ??!!

    With Meg having demonstrated such profound disrespect for the political system she now wants to be a part of; and, for the individuals she has employed; the questions about how she stands to personally gain a few bucks here or there from capital gains are mute.

    Likely, a monkey could have managed eBay (and myriad other co’s) during the runup of the internet bubble and been a success. The final legacy of business leaders like Meg, lay in current-day headlines (remember Goldman ?) .

    I’ve interviewed dozens of managers and prospective executives who lay claim to their “successes” during the go-go Internet boom and who, now that REAL managerial talents and fortitude are requisite, are hopeful that their “credential” will land them an opportunity a tad bit less challenging then that which will be required cleaning up the myriad messes their “success” so tangibly contributed to.

  • Elwood

    Re: #3&4

    And this bullpucky relates to the thread how?

  • For Liberty
  • RR, Uninvited Columnist

    Yes, friends, Evil Big Money, Corporate America Full of Greed is responsible for the Great (Bush) Recession, wars, poverty, corruption, oil spills, diseases, etc. And now, Evil Capitalists are trying to take over California! The “Golden State” (undoubtedly named by the pioneer Greedy Capitalists of the past) has been repeatedly ravished by Big Money. With such a rotten history, it amazes me that so many people want to live here. Perhaps Greedy Corporate America has clever liars in its employ, fooling goodhearted, non-greedy Americans and immigrants. Is there a single state in this Union free of such ugly Big Money interests? Please let me know.

  • I’ll be danged! That Meg-a-bucks is bein’ helped by them comp-ly-kated tax laws! Downtown Jerry Brown, Man o’Renown, wants ta take frum da Rich and give $$$ to da Poor. I’m all over dat! If’n I cants be richie rich, it ain’t fair fer nobody to be rich!