Wednesday, July 7, 2010

ARTICLE: Cash-strapped Long Beach seeks to tax marijuana

From Tony Barbosa at the LA Times:

Long Beach could join several other California cities in seeking to boost city coffers by taxing marijuana.

The City Council on Tuesday will consider a proposal to place a measure on the November ballot that would levy a 5% tax on medical marijuana collectives.

Another tax of up to 10% on other marijuana businesses would go into effect only if California voters also pass Proposition 19, which would legalize, regulate and tax marijuana for recreational use.

Long Beach's proposal, drafted by the city’s Department of Financial Management, also calls for taxing medical marijuana cultivation sites at .0075 cents per square foot.


Long Beach is facing an $18.5-million budget deficit, and for some on the city council, which voted in May to regulate medical marijuana collectives, taxation is the next logical step.

"We tax alcohol. We tax cigarettes. Why wouldn't we look at taxing marijuana?" Long Beach Councilman Patrick O’Donnell said. "We're turning over every rock to find new revenues, and under one of those rocks may be marijuana."


"It's difficult to tell cities that are cash-strapped in tough economic times that you can't tax this substance,” he said. "But there are other methods that local governments could use to raise the money; one of those methods is to tax the production side."


This is good news for buyers. You see, all those Long Beach sellers, obviously high as fuck if they're still sticking to wishing prices despite evidence of a double-dip in housing, might be forced to cut back on the weed if this new tax is passed on to consumers. Fewer bong loads, clearer minds, lower prices!

Pass that tax!

In all seriousness, with an $18.5-million deficit, LB has a serious budget problem. And in addition to cutting services, the solution is new and "innovative" revenue generation schemes like this.

I sure hope you recent buyers factored in increased costs of living in the form of new taxes, hikes in existing taxes, increased city fees and fines (think property assessments, street sweeping tickets, traffic citations), not to mention State and Federal attempts to squeeze blood from a turnip.

This isn't a political statement, it's statement of fact: We have had decades of debt-binging on cheap, easy credit, and the time has come to pay the piper.



  1. According to recent city meetings,Long Beach has a cost of $200,000. a year in salary,overtime, and benefits for EACH fireman.
    In many cities in CA. 25% to 50% of city employees make over $100,000. a year, in salary and overtime, alone.
    Cut all public salaries by 10%, and problem is solved.
    The City of San Carlos, CA. found out they can save $500,000. a year, just by having outside contractors cut the grass in city parks and baseball diamonds.

  2. Anon,

    Those firefighter salaries are simply unsustainable.

    And when Long Beach is forced to cut back on payrolls and city jobs, that's certainly not going to be housing-positive.

    I hope all of you government employees factored in the possibility of salary cuts and freezes and weren't banking on perpetual raises when preparing your housing budget...

  3. Double-dip, whooda thunk it?!?!!

    This is the "change you can believe in". For all you whom voted for Obama, and vote for all these socialist/liberals, ENJOY!!!!

  4. Dave in Alamitos BeachWednesday, July 07, 2010

    I remember when people were urging me to "move up" and stretch my budget to the max, I told them that I didn't think it was wise to expect everything to run perfectly. Because something always goes wrong. And look what happened.

    You HAVE to leave yourself financial room to take a few hard knocks. "Life is what happens when you're making other plans."

    PS Obama has got nothing to do with it. It's decades in the making...

  5. Dave, with all due respect, if you do not think that Obama, and/or the socialist liberals running our state congress have anything to do with all the debt in our State and Federal government, then you truly are clueless.

    Don't get me wrong, there's some Repubs that are just as bad on the spending, but this socialist mindset is what has created the debt, not a capitalist one. The government spending money that it didn't earn, is quite different than individuals/private citizens spending money on credit based on what they WILL earn in the future.

    One is not a good idea, the second is complete corruption.

    And Obama has just created more debt in one year, than ALL of the previous presidents combined.

    If you don't believe THAT is a problem, then.....

  6. Hey PH- you are talking out of where the sun don't shine. Please show me the numbers that clearly demonstrate that the federal budget has gotten worse under Obama than it did under Bush. You can't because Bush was the one who blew the budget with the tax cuts for the upper income crowd. Please enlighten us how that is socialism, pray tell.

    If you want a pure "capitalist mindset", then I suggest you move to libertarian paradise, Somalia, where there are no taxes and no government. Or if not Somalia, please give us a good example of a modern industrialized country where there is a "capitalist mindset" according to your desires.

  7. Yo "Qualified", on a blog as educational as this one, I'd be happy to SCHOOL you in some basic economic realities.

    In my own words, and keeping it simple, Capitalist minded folks realize that INCENTIVE is everything. Allowing people to keep more of WHAT THEY EARNED, not only is more fair and right, but it also stimulates growth. Conversely, taking from those who earn to give to those who do not, is DIS-incentive.

    The whole liberal/elitist/socialist mindset and talking points sound great. But that's just it - it SOUNDS great, and it's just TALK.

    It's really easy to be generous WITH OTHER PEOPLE'S MONEY.

    This can be easily realized by noting how all these liberals in office, cheat on taxes themselves.

    The mindset of liberalism today is the result of the phony and insecure individual who wants to feel that they are better and smarter. In comes all the political correctness, and utopian notions of "doing good", which aren't based upon reality.

    Hey personally I'd love to be able to take care of every third world refugee crossing our border, and every homeless person in LA (for example). REALITY is that I simply do not have the wealth to do such. The only means to make things better is to have more people contributing. This is the entire basis (and goodness) of Capitalism. Incentivising people to earn creates more wealth and opportunity.

    In contrast, Socialism seeks to demonize those who earn and achieve, create class warfare amongst the community, STEAL from those who earned and give the loot to those whom haven't. Officiating all this are "elites" who think that they are better, smarter people, then the rest of us.

  8. As for your attempt at vilifying tax cuts (and Bush, AND those who earn - hence we see you exuding the class warfare mentality to a tee), I HIGHLY suggest you educate yourself:

    Here is an excerpt:

    Do Tax Cuts Favor the Wealthy?

    The most common arguments against the Bush tax cuts are that they favor the wealthy and that we cannot afford them as they are depriving the government of needed revenues.

    The tax cuts do favor those with higher incomes. But this is because, under our progressive income tax system, the only people who pay the high marginal rates (the term marginal here refers to the tax bracket in which the last dollars of income are taxed - the progressive nature of the tax system is such that, as one's income rises, the additional increments of income are taxed at progressively higher rates) are high income people. Since the incomes of lower income people are below the threshold at which the higher rates kick in, they are not being penalized by the tax cuts.

    If the high tax rates in the upper income brackets actually generated significant tax revenues for the government and the cutting of these rates resulted in a reduction in total tax revenues which had to be made up with an increase in the rates in the lower brackets then we could argue that the tax cuts were shifting some of the tax burden from higher income taxpayers to lower income tax payers. However, this is not the case as history has shown that reducing high marginal rates encourages higher income people to work and invest more thereby creating a larger income pool on which to levy the tax. For example, if the total income available to tax in the 90% bracket is one billion dollars ($(1,000,000,000 - the actual number is much higher but I will try to keep this example simple) then the government will collect nine hundred million dollars ($900,000,000) in taxes on incomes in this bracket. If we cut the top rate from 90% to 50% and, due to higher income people deciding to work and invest more (such as former President Reagan deciding to make six or seven films per year rather the five), income available for taxation in the now 50% bracket increases to two billion dollars ($2,000,000,000) the government's take in taxes rises to one billion dollars ($1,000,000,000) or one hundred million ($100,000,000) more than at the previous 90% rate. Since the tax cut resulted in the government collecting more revenue from the high income brackets than previously, there is no need to raise more money from lower income people by increasing the taxes in the lower brackets. Further, the tax cut only applies to rates in the top brackets which only affect the last dollars of income earned by high income people, leaving high income people to continue to pay the same rates as everyone else on income taxed in the lower brackets.

    This situation is no different than if the government had enacted at one time a special fifty cent per cup tax on tea sold by the cup over the counter but had no tax on coffee sold by the cup. If the government then reduced the tea tax to twenty-five cents it would clearly be a tax cut favoring tea drinkers but one would be hard put to argue that coffee drinkers had been slighted or harmed by this in any way.

  9. Oh yeah, and as for where there is a country with "capitalist mindset" according to my desires? How about right here in the good ole US of A.

    You know, the place where the Tea Party is rising? Oh I'm sure you've HEARD of the Tea Party (though it's probably called something else by your friends), but in case you did not know where it comes from, it comes from the very FOUNDATION of this great nation (and yes this nation is great, in fact the GREATEST of all time), from revolting against a dictatorship of both unfair taxes, and taxation without representation.


    Sound familiar???

    Class (for now) is dismissed.


    PS Give me liberty or give me death.

  10. Oh wait, you asked for "numbers" didn't you....

    Don't take MY word for it, here:

    Calculated down to the exact penny, the debt totaled $13,050,826,460,886.97 as of Tuesday, leaping nearly $60 billion since Friday, the previous day for which figures were released.

    At $13 trillion, that figure has risen by $2.4 trillion in about 500 days since President Obama took office, or an average of $4.9 billion a day. That's almost three times the daily average of $1.7 billion under the previous administration, and led Republicans on Wednesday to place blame squarely at the feet of Mr. Obama and his fellow Democrats.

    and -

    Mr. Obama's $3.6 trillion budget blueprint, by his own admission, redefines the role of government in our economy and society. The budget more than doubles the national debt held by the public, adding more to the debt than all previous presidents -- from George Washington to George W. Bush -- combined. It reduces defense spending to a level not sustained since the dangerous days before World War II, while increasing nondefense spending (relative to GDP) to the highest level in U.S. history. And it would raise taxes to historically high levels (again, relative to GDP). And all of this before addressing the impending explosion in Social Security and Medicare costs.