The BEE had an article on May 6, 2010 about a press conference held by Roger Dickinson for Assembly. This is a response to the article.
The point of view of this article is strange. Wall street caused the current economic crisis. For evidence see 13 Bankers: The Wall Street Takeover and the Next Financial Meltdown, by Johnson and Kwak. Or, you can watch the current Economic Crisis Investigation on CSPAN co- Chaired by Phil Angelides. This crisis almost brought the world economy to its knees. Locally, the crisis produced unemployment, a severe reduction in tax receipts, cuts in Sheriff patrols, closing health clinics, clinics for the mentally disabled, Child Protective Services, and others.
Dickinson criticized the Wall Street role in the crisis. You bring out spokespersons for the rating agencies – that is spokespersons for Wall Street, to claim that Dickenson’s threat to sue might hurt Sacramento’s credit rating. Excuse me!
Sacramento is borrowing $134 million and paying interest on it because of the economic crisis. Now the debt officer claims that criticizing Casino Capitalism on Wall Street is the problem! No, the problem is the economic crisis. And, the pain will last for several years.
No one disputes that Sacramento county's revenues are drastically down. There has been a nearly 30 percent drop in sales tax for Sacramento County over the past five years. Property tax funds an even larger share of county budgets, and plummeting real estate values have meant even less income for counties to pay their bills.
During the current fiscal year, Sacramento's assessed property values dropped by 6.4 percent, and the outlook is for a continued decline into next year. And, the ongoing budget-crisis impacts from the state also caused by the financial recession, which cut funding for counties, yet still requires them to provide costly programs. The reality is that almost all of California's counties are facing significant budget shortfalls resulting in cuts in programs, services and staffing.
We need to look for ways to Make Wall Street Pay . One possibility is to charge a 2% tax on all sales of derivatives and CDO’s. I pay almost 8% sales tax when I buy anything in the county. That pays for police, fire, utilities, and services. But, when the Wall Street Casino sells billions in mortgage backed derivatives, they pay less than 1% tax. If they would have to pay a tax on their sales, it would slow down the casino. And, it would provide funds for the police protection, health clinics, Child Protective Services, and the many services which we are losing.