California takes interest-free loan from working people

posted at 10:30 am on October 31, 2009 by Ed Morrissey

As if working people in California didn’t have a tough enough time, they are about to see their paychecks get a little lighter, courtesy of their political class in Sacramento.  In order to help close a budget shortfall, the state will increase withholding from paychecks by 10%, in essence forcing every working person in California to make an interest-free loan to the state:

Starting Sunday, cash-strapped California will dig deeper into the pocketbooks of wage earners — holding back 10% more than it already does in state income taxes just as the biggest shopping season of the year kicks into gear.

Technically, it’s not a tax increase, even though it may feel like one when your next paycheck arrives. As part of a bundle of budget patches adopted in the summer, the state is taking more money now in withholding, even though workers’ annual tax bills won’t change.

Think of it as a forced, interest-free loan: You’ll be repaid any extra withholding in April. Those who would receive a refund anyway will receive a larger one, and those who owe taxes will owe less.

But with rising gas costs, depressed home prices and double-digit unemployment, the state’s added reach into residents’ regular paycheck isn’t sitting well with many.

Think of it as theft.  Most Californians won’t be as sanguine about getting their tax refunds next April, not after watching the IOUs go out this summer from Sacramento.  What happens when April rolls around and the state still doesn’t have the cash?  Do they confiscate the refunds and promise to pay them back in 2011?

This all starts with state leadership unwilling to make the tough decisions on cutbacks in the massive state bureaucracy.  Instead of cutting their own budgets, they’re cutting the personal budgets of all Californians by seizing their assets without compensation.  Golden State residents should ask themselves why they put up with a group of politicians who claim to be unable to reduce state spending but have no problem dipping into the pockets of Californians who actually work for a living.

Next November, Californians should conduct a full-unemployment program in their state legislature, and “withhold” 100% of the salaries of the current political class.


Related Posts:

Breaking on Hot Air

Blowback

Note from Hot Air management: This section is for comments from Hot Air's community of registered readers. Please don't assume that Hot Air management agrees with or otherwise endorses any particular comment just because we let it stand. A reminder: Anyone who fails to comply with our terms of use may lose their posting privilege.

Trackbacks/Pings

Trackback URL

Comments

Comment pages: 1 2

That’s some f$%^d up sh^% right there. Can they even DO that???

Scranton on October 31, 2009 at 2:55 PM

I was almost more disturbed by the fact that this extra 10% withholding was apparently part of the ‘deal’ worked out by Sacramento last summer… and this is the first we’re hearing about it. I mean, we voted down Props 1a et al, that’s great, but if there had been more public outrage about this… *sigh*

I just want to reiterate that, yeah, California is basically run by liberal morons, but the majority of the state is populated by decent people who are being systematically starved out (literally and figuratively) of their rights to life, liberty and the pursuit of happiness.

salmonczar on October 31, 2009 at 3:17 PM

http://www.veteranoutrage.com

I told ya they would start FORCING ALL of you SAPS to
Pay more
Get less
And hope like hell you even GET BACK ANY CHANGE..

Lets cut the bullshit here can we?

I will never see a damned DIME from Social security
I will never see a dime from medicare
I will never see a dime from my old union retirement account

veteranoutrage on October 31, 2009 at 3:18 PM

Two can play this game. I recommend all employed Karlifornians go to the website below, increase your withholding exemptions and submit, print it out and submit it to your employer:

http://www.edd.ca.gov/pdf_pub_ctr/de4.pdf

My employer does this on-line, and if yours does too take advantage of it. We sold a house in August 2008 and CA took a $22K withholding “loan” from the proceeds. We had to wait for our delayed tax refund in May 2009 (nine months) before we got the money back.

Bump up your withholdings for 2010 enough to offset this new hidden tax!

PD Quig on October 31, 2009 at 10:55 AM

Thanks. Good idea!

And for all you Californian bashers, not everyone that lives in this state is a f’ing lib.

artchick on October 31, 2009 at 3:29 PM

And for all you Californian bashers, not everyone that lives in this state is a f’ing lib.

artchick on October 31, 2009 at 3:29 PM

Just 82%

angryed on October 31, 2009 at 3:35 PM

You can do that. I do that now. However, make sure you estimate with exactitude because there are penalties for under-withholding. Yes, a penalty for not paying your taxes in advance.

PattyJ on October 31, 2009 at 2:12 PM

I objected to withholding in OK and declare estimated taxes paid once per quarter. (State as well as Federal). I usually owe them both a little in April, but by estimating the same tax as paid the previous year, they can’t penalize me. Does CA not allow estimated taxes? If they do, this is the cheapest way to pay tax on time without penalty. End up underpaying during the year so they are not keeping your excess money without paying you interest.

Christian Conservative on October 31, 2009 at 3:41 PM

When are those voting idiots in California going to wake up?
Have you seen the commercial with the Terminator and wife Shriver saying “Come to California – you’ll like it here” or something like that? I laugh out loud everytime it airs.
Who in their right mind would move to California to live and work?

redslippers on October 31, 2009 at 3:45 PM

And again, this shows that the Democrats need to be fired at EVERY level of government. They have deemed themselves to be entitled to an extra portion of my paycheck above and beyond what I owe them. And there is no guarantee that they will solve the problem that precipitated this action or that there will actually be any money at the end of the year to repay me. Will I get my money back in the form of an IOU?

How can they require me to pay more than I owe them? I simply do not understand who that is legal. And under what article of the constitution of the state do they have the power to confiscate the earnings of citizens, even if only temporarily in order to satisfy their lack of fiscal discipline?

Our state assembly simply has to learn to say NO to new spending and roll back existing spending. I am not saying that all of these programs are bad. I am saying that a judgment needs to be made on the value of the program compared to the cost. Some of these programs need to be ended because we can no longer afford them. Other programs need to be scaled back for the same reason.

California Democrats believe that the people’s earnings are theirs to spend. And if the tax rates aren’t high enough, they feel they can simply take extra.

I don’t see how this could stand up in court.

crosspatch on October 31, 2009 at 3:45 PM

This kind of confiscation is the reason more and more people are quietly falling off the screen, under the radar, off the books and out-of-sight. Not a significant number yet, but slowly and steadily growing in numbers. Going Galt and disappearing into the boonies.

I see them showing up here and property shopping. The normally depressed property prices around here are now really in the dumpster and a lot of 40′s are to be found everywhere, for sale cheap.

There are no jobs, there is much less infrastructure, and it’s a drive to get anything, anywhere, but I guess they figure being poorer here is going to be better, and safer, than being poorer in the cities. A number have high-speed satellite internet and I assume are planning on doing their business that way.

Some will last a winter, or two. Some won’t.

Yoop on October 31, 2009 at 3:53 PM

Just 82%

angryed on October 31, 2009 at 3:35 PM

82% does not sound right.

http://pewresearch.org/pubs/773/fewer-voters-identify-as-republicans

In California and Illinois, the balance of party identification has remained largely unchanged,(39%Dem, 28%Repub) with Democrats holding roughly a 10-point edge. As in other parts of the country, however, the number of voters who say they identify with neither party is on the rise, from 29% to 33% of California voters since 2004, and from 34% to 40% of Illinois voters.

artchick on October 31, 2009 at 4:15 PM

I really don’t see how they can be entitled to not having to pay interest if the amount of withholding is known to be beyond the rate needed to pay the tax bill.

crosspatch on October 31, 2009 at 4:17 PM

As a working Californian I ask, “Why not 20%?” “How about 40%?”

What I’m looking for is that percentage where though of us who don’t particularly care for the idea of slavery pick up our guns and solve this situation ourselves.

mr1216 on October 31, 2009 at 4:31 PM

where though those of us

mr1216 on October 31, 2009 at 4:32 PM

And all the worker has to do is tell the accounting office to take 10% LESS withholding out of your check.

You can have 0% state and federal withholding if you want to. Withholding is determined by the worker, not the state. At least that’s how it works in VA.

uknowmorethanme on October 31, 2009 at 4:33 PM

And for all you Californian bashers, not everyone that lives in this state is a f’ing lib.

artchick on October 31, 2009 at 3:29 PM

Thank you. Took the words out of my mouth. : )

Who in their right mind would move to California to live and work?

redslippers on October 31, 2009 at 3:45 PM

Someone who had the unfortunate luck to be born and lived here their whole life. Not counting the time I was deployed to foreign seas. There are people who woke up a long time ago. Part of the problem here are the Assembly Districts. Seriously, go look up the boundaries of the districts in a few major cities. LA and San Diego are good examples. The majority are gerrymandered all to hell. By both parties.

Yes, the Dems here are a pain in the @ss. A lot of the Republicans here are too. The majority on both sides have no incentive to pay more than lip service to their constituents. This is because they are nearly assured to win in part because of the district boundaries. Most of them owe their election to our second problem – the unions.

The only time an assemblyman leaves on either side is through retirement, resignation, recall, or through a scandal even the party can’t ignore. Great example here – Mike Duval. He’s a Republican who campaigned on family values. Idiot bragged about cheating on his wife with a lobbyist, on an open mike. Even then, you can almost guarantee the party that held the seat before will keep it. That’s the central problem. With a few exceptions neither side expects to ever be forced out. At the national level, the NRCC considers this state a lost cause. For those and many other reasons – I vote almost straight Libertarian for state candidates. Call it what you want. Far as I’m concerned, the only difference between most of the CA pols in either party are the letter next to their name. Which effectively means nothing in their actions.

Next “fun” thing heading our way is AB32. Ahnold signed this to get his global warming cred. It will start to bite in 2011. At that point the state is required to go from 12% renewable energy (current use) to 20% by 2013. Up to 30% by 2020. Part of that bill severely penalizes trucking companies based in this state. Combine that with the water shortage induced by a certain judge here. This means that at the same time energy costs and taxes are hiked on all businesses in the state, the cost of living (especially food) will skyrocket. I figure by 2013 my employer will consider pulling out – despite the government contracts they’re getting.

A lot of the working class get it. Hell, we got it a long time ago. Those who can leave are leaving. Those who can’t are digging in. A lot of people useful idiots here think the feds will save this state from bankruptcy and collapse. I have no illusions – I see government people in action on a fairly regular basis around here. Those at the top will not get it until the whole house burns down on top of them.

Suihei Deloi on October 31, 2009 at 4:48 PM

These antics by the state may break the compact between taxpayers and government as a cooperative compact. Taxpayers may change their W-4 and take more exemptions and then default on paying taxes or chose to do estimated tax payments. If taxpayers refuse to pay taxes then what is the state to do? Lock them all up? That will do wonders to the tax rolls to lock up workers

RAH on October 31, 2009 at 4:52 PM

Sigh. Look, it’s raising up ONE percent TO 10%.

Mazztek on October 31, 2009 at 4:54 PM

Ed, you’re a clown. It’s not at all like theft as tax agencies can change their withholding rules at will. You do know what “at will” means? Sneaky and underhanded, yes…but not a crime.

Besides, most companies have 3rd party providers preparing their PR and will, if not already as in the case of ADP, notify employers about the change. Employees need simply alter their w/h allowances to compensate for the additional amount.

No crime, no “gotcha” moment and no WMD.

Try again Ed.

Good4Onan on October 31, 2009 at 5:07 PM

As a working Californian I ask, “Why not 20%?” “How about 40%?”

What I’m looking for is that percentage where though of us who don’t particularly care for the idea of slavery pick up our guns and solve this situation ourselves.

mr1216 on October 31, 2009 at 4:31 PM

Amen brother.

huckelberry on October 31, 2009 at 5:08 PM

I do not understand why Californians continue to band together for mass consumption of left-flavored Koolaid while they pay no attention to the Government’s hands digging around in their pockets.

redwhiteblue on October 31, 2009 at 5:26 PM

Just 5 more years baby. Five more years and this deviant infested $hit-hole of a state run by reprobates and thieves will be in my rear view mirror forever. Me, my immediate family that further includes tax paying workers as well as future wage earners, my entire retirement pension, savings, 401k’s, stocks, EVERYTHING, leaves California forever.

We are all very excited about leaving. Which also makes these last 5 years sometimes feel like an eternity.

I swear by all that is holy that it will be so and I shall never ever return to this cesspit that is California ever again.

Hallelujah!

SilverStar830 on October 31, 2009 at 5:37 PM

Suihei Deloi on October 31, 2009 at 4:48 PM

Don’t forget this gem Ahnold signed into law.

BallisticBob on October 31, 2009 at 5:51 PM

Caleefornea should do what every bankrupt entity with no prospects does…liquidate and cease operation.

Skipper50 on October 31, 2009 at 6:07 PM

Somebody explain to me how any incumbant in California ever gets reelected? Honestly now. I don’t understand and hope you can explain it to me.

Snake307 on October 31, 2009 at 6:23 PM

Referendum them, fire 50% of all departments. period. YOU can create law in California.

docjohn52 on October 31, 2009 at 7:43 PM

I’m not from CA, but if I were my State W-4 would all of a sudden reflect 2 more children/dependents. F their 10%.

NickelAndDime on October 31, 2009 at 7:44 PM

Ugh. I do payroll for 43 people. When they bring me their checks and ask what happened, I look forward to telling them about it. I already had to explain why the check stubs started showing benefit dollar values: so the gov’t can tax them to pay for obamacare.

Bad Penny on October 31, 2009 at 9:11 PM

I like this. The next election in california will be a pass/fail iq test.

gh on October 31, 2009 at 9:13 PM

Sigh. Look, it’s raising up ONE percent TO 10%.

Mazztek on October 31, 2009 at 4:54 PM

rotflmao … it’s still 10% either way you look at it.

gh on October 31, 2009 at 9:15 PM

If you support Marxists, you get what you deserve. If I were the non-marxists in Cali, I’d leave that state at light speed.

If you stay, you get what you have coming.

The Ronin Edge on October 31, 2009 at 9:00 PM

WTF! Are your serious? Some of us don’t call home a cardboard box.

artchick on October 31, 2009 at 10:28 PM

1099 yourself, pay estimated quarterly taxes. Adjusting your W-4 might be difficult, since lots of states link them to your federal W-4. I don’t know what California is like, since I have fortunately never had to work there.

Andy in Colorado on October 31, 2009 at 10:39 PM

Snake307 on October 31, 2009 at 6:23 PM

As I mentioned before – the districts here are gerrymandered. That’s how the same idiots get voted in every time. Or another way to say it – never underestimate the power of stupid people in large groups.

The Ronin Edge on October 31, 2009 at 9:05 PM

You really want to know? I have a wife in experimental chemotherapy. The city I live in happens to be the only place ON THE PLANET where she can get treatment. If it weren’t for that, I would have left a long time ago. So with all due respect – stick it.

Suihei Deloi on October 31, 2009 at 10:56 PM

They aren’t going to get their money back, are they? OMG. Shameful rape of taxpayers. Disgusting.

fullogas on October 31, 2009 at 11:04 PM

Andy in Colorado on October 31, 2009 at 10:39 PM

Yes Andy, you can have your state deductions on the W-4 differ from your federal ones in CA. I do this already. They’ve actually made it easier to do so the last few years.

fullogas on October 31, 2009 at 11:04 PM

Supposedly we’re supposed to get it back in April. Of course, they could tank the budget again next year and just issue IOU’s instead of tax refunds. I’m not holding my breath.

Suihei Deloi on October 31, 2009 at 11:14 PM

At this rate, I’m gonna have to ask for a 20% raise from my employer this year just to get ahead.

But they’re hope n’ change-a-holics so they should be more than happy about spreading some wealth my way.

The Ugly American on October 31, 2009 at 11:19 PM

As usual, California is a harbringer of what follows for the rest of us.

This is an ominous precedent

Archimedes on October 31, 2009 at 11:32 AM

Last Wednesday’s Glenn Beck program (and for any GB haters, sorry to bring him up) he talked about Weimar Germany, where the country printed up lots and lots of money, then followed by hyperinflation. They printed all this money, to pay off the country’s debts, then trashed that currency and came up with a new one. He said they didn’t have anything left of value in their country, except for natural resources such as mining, etc. He said USA is going the same way and mentioned that the Fed gov has already seized some CA state parks as their land. Who do we owe money to? Russia? China? Does anyone think maybe they want people to move out of CA? And why? Correct me if I’m wrong anyone who saw the show. Sometimes GB goes so fast I have to rewind the dvr, you know?

This news makes my gut sink. What’s to stop it happening all over the USA? Maybe I’m overreacting, but can you imagine this happening in several states, with a ton of people swarming into the economically “healthy” states?

Or, won’t the crime rate rise? How can they possibly think people have enough money to enact this? So many people right now are having a tough time making ends meet.

fullogas on October 31, 2009 at 11:32 PM

fullogas on October 31, 2009 at 11:32 PM

Specifically referring to your state park thing. A while back, the CA Governor and Assembly talked about closing 6 major state parks to help balance the budget. This was one of those consequences that was threatened if the voters did not vote in favor of Props 1A-F. 1A-F were effectively a massive tax grab.

When the Governor and Assembly went to go ahead and follow through after the election (the props were voted down); the Federal Government informed the state that the parks in question were on lands that were originally owned by the Feds. Additionally, those lands had only been loaned by the Feds so the state could run them as state parks. The Feds stated that if the Governor and Assembly closed them, they would reassert control of the land and reopen them as national parks. In the end, Governor and Assembly backed down. Hate to say it, but I believe GB may be wrong on this one.

Suihei Deloi on October 31, 2009 at 11:48 PM

Suihei Deloi on October 31, 2009 at 11:48 PM

Almost forgot fullogas. The state parks are one of the few government-run ventures in CA that actually at least break even – and even show a profit. The CA legislature usually raids their excess funds to paper over shortfalls in the general budget each year. Among the six parks was one near Malibu. It’s one of the most visited state parks in CA.

Suihei Deloi on October 31, 2009 at 11:52 PM

Think of it as theft dictatorial taxation without representation…and theft.

Next November, Californians should conduct a full-unemployment program in their state legislature, and “withhold” 100% of the salaries of the current political class.

Why wait? Why not start recall petitions? Is it better to wait til they decide 10% is not enough and they jack it up to 15 or 20%?

91Veteran on November 1, 2009 at 1:06 AM

91Veteran on November 1, 2009 at 1:06 AM

Actually one has been started in Glendora. Granted it’s only one Assemblyman. But everything has to start somewhere. Site is http://www.recalladams.org. As for what this clown did to earn it, he was one of six RINOs who were deciding votes for the largest tax increase in California history. To add fuel to the fire, Adams had previously pledged on local talk radio that he would not vote to raise taxes. Obviously he broke that promise. Signatures are already in and waiting to be confirmed; the committee is gearing up for the recall election.

Suihei Deloi on November 1, 2009 at 4:36 AM

A lot of those California frogs getting warm in that pot of water. Better jump out before you get boiled.

Vote with your feet. Come to Texas and make money you get to keep!

gordo on November 1, 2009 at 10:12 AM

PS: Anyone staying and saying they can’t leave is making excuses.

I call B.S. cop-out.

Nothing is stopping you, get off your ass and move. There is work out there if you’re willing to do it.

“Oh nos I won’t make as much money!!”

Then stop crying about living in a s*&^hole gulag of a liberal nanny-state.

The Ronin Edge on October 31, 2009 at 9:05 PM

Hey captain clueless, some of us have family here, others have houses they can’t sell. Picking up and starting over somewhere from nothing may sound simple to you, but it’s different when you’re not single and sleeping in mom and dad’s basement.

evergreen on November 1, 2009 at 12:16 PM

The state parks are one of the few government-run ventures in CA that actually at least break even – and even show a profit. The CA legislature usually raids their excess funds to paper over shortfalls in the general budget each year. Among the six parks was one near Malibu. It’s one of the most visited state parks in CA.

Suihei Deloi on October 31, 2009 at 11:52 PM

And then the idiots in Sacramento use them as levers to try to extort more tax money out of us. “But what will happen to our national parks!” Liars.

evergreen on November 1, 2009 at 12:18 PM

Karen Bass and her cabal are a very dangerous group. California will never recover as long as the ladies from south Los Angeles run the state.

FireBlogger on November 1, 2009 at 12:29 PM

Left California in 87 and turned down opportunities to return in 94 and 2000 – never a regret. Those of you who are real workers in California should get out while you can salvage something. California will not recover in our lifetimes. Michigan was once as vibrant as California, and over decades it keeps finding new ways to continue its deterioration. Every time you think, surely the government/companies/unions/Democrats in Michigan will wise up and stop the slide, they manage to avoid taking any serious action to fix the state. California shows all the same signs and if you live there, you will see the same decline for the rest of your lives.

Over50 on November 1, 2009 at 12:31 PM

FireBlogger on November 1, 2009 at 12:29 PM

Her nickname here is “Widemouth” Bass – from the observation that whenever a camera’s on her, she won’t shut up.

gordo on November 1, 2009 at 10:12 AM

I started doing a little bit of business development for my employer recently, kind of a second hat. One of the focuses is developing business in other states – in case a tactical withdrawal becomes necessary. Not being from Texas – I’ve been researching Arizona, Nevada and South Carolina – any ideas on an area friendly to people in the engineering/network design business? People from other states feel free to chime in.

Suihei Deloi on November 1, 2009 at 1:35 PM

Suihei Deloi@1:35PM
Texas and South Carolina are both hot and humid in the summer, and cold in the winter. It’s like Bakersfield with bugs and snakes on steroids and so much moisture in the air you can’t breathe. You must have travelled some in AZ and NV? They are what they are too. I love Texas but it is a whole different country and not for everybody – that’s why we have Austin. As far as employment though, all states are having a tough time unless you’re entrenched in your job. The areas with a well educated work force and ready to hit the ground running are ID, MT, WY, ND&SD. Summers are stunning, winters will teach you a whole library full of new swear words.

24K lady on November 1, 2009 at 3:38 PM

24K lady on November 1, 2009 at 3:38 PM

I’ve traveled in both, and my employer has a location in AZ. Once upon a time, they had offices in SC and NV. I’d like to start something there again. Texas I’ve only passed through, but I hear nice things about it. I can definitely agree on Montana – beautiful scenery. But damn it’s cold.

In general, the idea has been to get some business going outside CA. So if one day corporate decides it’s time to throw in the towel, we have places with customers to go to. Always have a plan B.

Suihei Deloi on November 1, 2009 at 4:53 PM

Ed, you’re a clown. It’s not at all like theft as tax agencies can change their withholding rules at will. You do know what “at will” means? Sneaky and underhanded, yes…but not a crime.

Besides, most companies have 3rd party providers preparing their PR and will, if not already as in the case of ADP, notify employers about the change. Employees need simply alter their w/h allowances to compensate for the additional amount.

No crime, no “gotcha” moment and no WMD.

Try again Ed.

Good4Onan on October 31, 2009 at 5:07 PM

So it’s merely a sneaky and underhanded method of arbitrary government pillage of our income, which we can all fix with a false filing to a wholly different jurisdiction…for now…before somebody in Washington decides to make that punishable by a fine. Riiighhhtttt

Chris_Balsz on November 1, 2009 at 11:36 PM

You’ll be repaid any extra withholding in April.

More likely you’ll get an interest free IOU.

MarkTheGreat on November 2, 2009 at 8:23 AM

Comment pages: 1 2