Washington Prowler

Super Tuesday’s Tax Measures

Big Labor backs stealth moves -- and anti-tax groups seem unaware. Also: McCain's elusive endorsements. Flagrant foul on Coach Majerus. Huckabee angry (again).

By 1.23.08

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WHATEVER IT TAKES
State leaders of Big Labor -- including the AFL-CIO and the American Federation of State, County and Municipal Employees -- have told supporters of several local tax-increase measures in California that they are willing to commit "whatever it takes" to ensure the ballot measures pass on February 5, 2008, according to a state AFSCME member.

Right now, several large localities in California, including the cities of Los Angeles, Pasadena, Richmond, and San Bernardino, are pushing utility "modernization" ballot measures that would essentially raise consumer taxes on Internet and cell phones users.

The unions are getting behind the measures because the bulk of the tax dollars raised from the change in local tax laws would go toward civil service costs related to public safety and municipal operations -- in other words, their membership.

"It's kind of surprising that anti-tax groups haven't been pushing harder against these initiatives," says a Southern California political consultant. "We're talking about millions in new tax revenue off these little changes, and it's all being done through the backdoor."

Essentially, what the localities are trying to do is extend a 40-year-old utility tax on phone service to services that most consumers use over the Internet or on their cell phones or Blackberrys.

"The old utility taxes are between 10 and 7 percent per month, and show up on the bottom of phone or cell phone bills," says the consultant. "Some municipalities are actually lowering the rate with their ballot initiatives, but changing the definition of what a 'phone service' is to include things like data services, so while the rate may appear lower, most taxpayers who use those services will actually see the amount they pay in taxes go up. Some may even see their cell phone tax bills double."

Data services include things like text messaging, music and video downloading, and down the road, many policy experts in the field believe even e-mail could be taxed under a "data service" definition.

The city of Pasadena, for example, is calling its initiative, Measure D, a utility tax "modernization" plan. While the rate of the utility tax would remain at about 8 percent, the city would impose the tax on consumers who use text messaging or who download music or movies online.

"These pols are being clever. They tell the voters 'We aren't raising taxes and we aren't taxing the Internet,' and they are being accurate, but in fact, they are taxing what you use the Internet for," says state assembly staffer. "They are being accurate, but they aren't being honest with the voters."

Adding insult to injury, the campaigns in support of the tax-increase initiatives are being financed by the municipalities and the labor unions, in other words, by taxpayer dollars.

AFSCME, according to the state union official, is prepared to commit more than a million dollars to get the local initiatives passed. "It could mean three to four times that in money back in union-member pockets," says the official. "This is worth the investment."

ROMNEY CHECKS McCAIN
If Sen. John McCain was anticipating endorsements from Sen. Mel Martinez and Gov. Charlie Crist in the Florida primary, he's in for a disappointing surprise, according to Romney campaign aides.

"If those guys want a political future in this state, they will sit on the sidelines," says one Romney adviser. "We have some of the biggest Florida fundraisers with us right now, and if Mel or Charlie went with McCain, we'd make them both pay when it came time for them to get donor dollars for another race."

Martinez was telling friends he was prepared to endorse McCain last week, and the McCain campaign was privately crowing about both Martinez and Crist endorsements. But Romney supporters in Florida have been putting pressure on both pols to sit on the sidelines in this primary state, threatening to make life difficult for them financially if they go with another candidate.

"This is so typical of the Romney people thinking they can buy their way to a victory," says a McCain aide in Tallahassee. "We think in the end we'll get both endorsements. It just might take a little extra effort."

CATHOLIC COACHING
St. Louis University head basketball coach Rick Majerus sought and received permission from the Jesuit president of the school before he attended and spoke at a rally for Sen. Hillary Rodham Clinton, according to school sources. Majerus has touched off a firestorm for saying at the event that he supported abortion rights for women.

St. Louis University is a Jesuit University. Under guidelines put forward by the Vatican, the school is expected to hire a faculty that teaches and promulgates Roman Catholic dogma. Majerus, in his capacity as head coach, is considered a member of the faculty.

"He's not a theology or philosophy teacher," says a Jesuit instructor at the school. "Coach Rick doesn't have to adhere to Vatican policies in that regard. This was free speech. We couldn't stop him, nor would we."

It's the "nor would we" part of that sentence that is getting the school's president, Rev. Lawrence Biondi, in hot water with St. Louis, Mo., Archbishop Raymond Burke.

Burke, a favorite of Pope Benedict, is not new to this kind of controversy; in fact, he seems to enjoy it. Back in 2004, he was the bishop who stood up to Sen. John Kerry and said he would not give the politician Holy Communion due to the presidential candidate's support of abortion and stem cell research.

MIKE ANGRY AGAIN
Former Gov. Mike Huckabee was said to be livid about leaks that he was losing senior advisers due to pay cuts or no paychecks at all, and blamed his campaign manager, Ed Rollins, for the problems.

Rollins was the adviser who pressed Huckabee into spending millions in the Michigan primary, when Huckabee wanted to spend the money in Florida and on Super Tuesday media buys. Now, Huckabee doesn't have the money to do both.

Rollins, along with other senior advisers, was also the one to push the highly negative push polling calls in South Carolina -- even on the day of the primary vote.

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