California's coming financial meltdown: will anyone notice?

John G. Matsusaka:

California's statewide sales tax of 7.25% is already the highest in the nation. Income taxes are also high, with the 10.3% rate on the top income bracket the highest in the nation. The highly progressive nature of the state's income tax schedule -- the top 10% of earners supply more than 70% of income tax revenue, according to one estimate -- already results in excessive revenue volatility. It also raises questions about how much redistribution of wealth is fair: Should the top 10% foot the bill for basic services enjoyed by all Californians...?

Voters are criticized for wanting more services yet being unwilling to pay higher taxes. That is unfair; Californians have repeatedly demonstrated their willingness to fund valuable programs. But if spending can go up 40% and most of us can't discern any difference, can we blame voters for being hesitant to put even more tax money in the hands of the state?

c/o Virginia Postrel, who has more.