Friday, September 23, 2011

Schwarzenegger a Political Blackmailer Says Rincon's Bo Mazzetti

Rincon Tribal Chairman Bo Mazzetti has an article up in Indian Country Today:

States and governors just can’t seem to control themselves; they cannot keep their hands out of tribal pockets. The concept that tribal governments have rights and financial needs has eluded them for so long they have become accustomed to ignoring them.

But occasionally a governor gets a hand slap for reaching too far into tribal pockets and breaching our sovereignty. An example is the Rincon Band of Luiseño Indians’ legal victory over former California Governor Arnold Schwarzenegger for illegal taxation and bad faith in renegotiating Rincon’s gaming compact.

The case affirms that occasionally tribes have the power to tip the imbalance of power states enjoy.

Schwarzenegger was a political blackmailer from the outset of his career as a California politician. He used tribes and gaming income as a wedge issue in his run for governor. It may not have been “playing the race card,” but it was a none-too-subtle “us versus them” strategy.

In an expensive television campaign, he asserted that the former governor’s deal with the gaming tribes had been too favorable to California Indians. He vowed that he make tribes pay their “fair share.” The backdrop for the campaign was the state’s continuing budget deficits and the voters’ “no new taxes” mentality.

Schwarzenegger found a painless solution for California voters: Tax the rich gaming Indians. It didn’t matter that most California tribes are far from rich—they’re actually closer to destitute—and only a few tribes earn big bucks through gaming.  OP:  That's because they try to keep tribes from getting casino's and becoming competitive.

Schwarzenegger carried out his promise to make tribes pay more. He accomplished that by renegotiating compacts or approving new compacts with tribes only when they agreed to be taxed at 15 percent and up to 25 percent of net win. Since there was no consideration of overhead and deductions for operations, a net win for the Rincon Band, asking to renegotiate to add 900 new slot machines, would have actually been a 30 to 40 percent tax.

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