depletion allowance

depletion allowance

In tax law, the deductions from gross income allowed investors in exhaustible commodities (such as minerals, oil, or gas) for the depletion of the deposits. The depletion allowance is intended as an incentive to stimulate investment in this high-risk industry, though critics argue that mineral deposits are valuable enough to justify high levels of investment even without tax incentives. Seealso depreciation.

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Edmund Gerald "Jerry" Brown, Jr. (born April 7, 1938) is the current Attorney General and former governor of the State of California. Brown has had a lengthy political career spanning terms on the Los Angeles Community College Board of Trustees (1969-1971), as California Secretary of State (1971-1975), as Governor of California (1975-1983), as chair of the California Democratic Party (1989-1991), the Mayor of Oakland (1998-2006), and the Attorney General of California (2007-present). He unsuccessfully sought the Democratic nominations for president in 1976, 1980 and 1992, and was an unsuccessful Democratic nominee for the United States Senate in 1982. Since Brown's terms in office are not covered by term limits that came into effect in 1990, he is not barred from running for Governor again.

Early life and education

Brown was born in San Francisco, the only son of former San Francisco lawyer, District attorney and later Democratic governor Edmund G. "Pat" Brown Sr. He graduated from St. Ignatius High School and studied at Santa Clara University. In 1958, he entered Sacred Heart Novitiate, a Jesuit seminary, intending to become a Catholic priest.

However, Brown left the seminary and entered the University of California, Berkeley, where he graduated with a Bachelor of Arts in Classics in 1961. Brown went on to Yale Law School and graduated with a Juris Doctor in 1964.

After law school, Brown worked as a law clerk for Mathew Tobriner, who was a justice for the Supreme Court of California, and studied in Mexico and Latin America.

Legal career and entrance into politics

Brown returned to California but initially failed the bar exam. After passing the bar Brown settled in Los Angeles and joined the law firm of Tuttle & Taylor. In the late 1960s, he entered politics by organizing migrant workers and anti-Vietnam War groups. In 1969, he ran for the newly created Los Angeles Community College Board of Trustees, which oversaw community colleges in the city, and placed first in a field of 124.

In 1970, Brown was elected California Secretary of State. Brown used the position, which was historically limited in power, to bring suits against corporations such as Standard Oil of California, International Telephone and Telegraph, Gulf Oil, and Mobil for violation of campaign-finance laws and argued in person before the California Supreme Court.

Brown also enforced laws requiring members of the California State Legislature to disclose sources of campaign funds and investigated allegedly falsely-notarized documents that had allowed Richard Nixon to claim a large tax deduction. Brown also played an important role in the drafting and passage of the California Fair Political Practices Act. These highly-publicized actions resulted in statewide acclaim, and led to his election as governor in the next statewide election.

Governorship

In 1974, Brown was elected governor of California, succeeding the Republican Governor Ronald Reagan, who was retiring from office after serving two terms, and who, himself, had become governor after defeating Brown's father, Edmund G. "Pat" Brown, Sr., in the 1966 election. Jerry Brown took office in 1975.

Strongly opposed to the Vietnam War, Brown had a broad base of support from California's young liberals. Upon election, he refused many of the privileges and trappings of the office, forgoing the grand California Governor's Mansion (which was sold under Brown in 1983) and instead rented a modest apartment at the corner of 14th and N Streets, adjacent to Capitol Park in downtown Sacramento. Instead of riding as a passenger in chauffeured limousines as previous governors had done, Brown was driven to work in a compact sedan, a Plymouth Satellite from the state vehicle pool.

During his two-term, eight-year governorship, Brown had a strong interest in environmental issues, which were being highlighted during the decade. Brown appointed J. Baldwin to work in the newly-created California Office of Appropriate Technology, Sim Van der Ryn as State Architect, and Stewart Brand as Special Advisor. He appointed John Bryson, later the CEO of Southern California Electric Company and a founding member of the Natural Resources Defense Council, chairman of the California State Water Board in 1976. Brown reorganized the California Arts Council, boosting its funding by 1300 percent and appointing artists such as environmentalist and poet Gary Snyder.

In 1975, Brown obtained the repeal of the "depletion allowance," a tax break for the state's oil industry, despite the efforts of the lobbyist Joe Shell, a former intraparty rival to Richard M. Nixon. Brown aimed his fire at "big oil" in an era of popular environmental activism on the West Coast. The decisive vote against the allowance was cast in the California State Senate by the usually pro-business Republican Senator Robert S. Stevens. Shell claimed that Stevens had promised him that he would support keeping the allowance: "He had shaken my hand and told me he was with me." recalled Shell. Brown later rewarded Stevens with a judicial appointment, but Stevens was driven from the bench for making salacious telephone calls. In 1977 Brown proposed and later passed a landmark tax incentive for home-owners installing solar panels.

Brown appointed the first black (Wiley Manuel), female (Rose Bird), and Latino (Cruz Reynoso) judges to the California Supreme Court.

Like his father, Brown strongly opposed the death penalty and, as Governor, vetoed death penalty, but legislature overrode the veto in 1977. He also appointed judges who opposed capital punishment. As presidential candidate he also states his opposition. In 1960 he lobbied his father, then Governor, to spare the life of Caryl Chessman and reportedly won a 60-day stay for him.

Currently, as Attorney General, he is obligated to represent the state in fighting death penalty appeals and stated that he will follow the law, regardless of his personal beliefs.

1976 presidential campaign

While serving as governor, Brown twice ran for the Democratic nomination for president. The first time, in 1976, Brown entered the race very late in the primary season as the focus of a movement to stop the nomination of former Governor of Georgia Jimmy Carter, who many in the party felt was unelectable because of a perceived limited record as a one-term governor.

Citing his record of having curbed his state's spending and balanced its budget while expanding services in the area of welfare, employment, and consumer and environmental protection, Brown proclaimed his belief that there would soon be a voter backlash against expansive and costly government policies. "This is an era of limits, and we had all better get used to it," he declared. Brown's name began appearing on primary ballots in May and he won a big victory in Maryland, followed by Nevada, and his home state of California. Brown missed the deadline in Oregon, but he ran as a write in candidate and finished a strong third behind Carter and Senator Frank Church of Idaho, another late candidate. Brown is often credited with winning the New Jersey and Rhode Island primaries, but in reality, uncommitted slates of delegates that Brown advocated in those states finished first. Despite this success, he was unable to stall Carter's momentum, and his rival was nominated on the first ballot at the 1976 Democratic National Convention.

1980 presidential campaign

In 1980, Brown challenged Carter for renomination. His candidacy had been anticipated by the press ever since he won reelection in 1978 over the Republican Evelle Younger, the biggest margin in California history, 1.3 million votes, but he had trouble gaining traction in both fundraising and polling. This was widely believed to be the result of the more prominent candidacy of liberal icon, Senator Ted Kennedy of Massachusetts.

As his campaign that year was much longer, Brown's 1980 platform, which he declared to be the natural result of combining Buckminster Fuller's visions of the future and E.F. Schumacher's theory of "Buddhist economics", was much expanded from 1976. Gone was his "era of limits" slogan, replaced by a promise to, in his words, "Protect the Earth, serve the people, and explore the universe." Three main planks of his platform were a call for a constitutional convention to ratify the Balanced Budget Amendment, a promise to increase funds for the space program, and, in the wake of the 1979 Three Mile Island accident, opposition to nuclear power.

On the subject of the 1979 energy crisis, Brown decried the "Faustian bargain" that he claimed Carter had entered into with the oil industry, and declared that he would greatly increase federal funding of research into solar power. He endorsed the idea of mandatory non-military national service for the nation's youth, and suggested that the Defense Department cut back on support troops while beefing-up the number of combat troops. He described the health care industry as a "high priesthood" engaged in a "medical arms race" and called for a market-oriented system of universal health care.

As his campaign began to attract more and more members of what some more conservative commentators described as "the fringe", including activists like Jane Fonda, Tom Hayden, and Jesse Jackson, Brown's polling numbers began to suffer. He received only 10% of the vote in the New Hampshire primary and he was soon forced to announce that his decision to remain in the race would hinge on a good showing in the Wisconsin primary. Although he had polled well there throughout the primary season, a disastrous and bizarre attempt at filming a live, special effects-filled, thirty-minute commercial (produced and directed by Francis Ford Coppola) led to the melt-down of his candidacy. He received just 12% of the vote in the primary. He withdrew from the race the next day, having spent $2 million, won no primaries, and received exactly one delegate to the convention.

Defeat and return

In 1982, Brown chose not to seek a third term as Governor, which was allowed at that time. Instead he ran for the U.S. Senate for the seat held by Republican S.I. Hayakawa. That year, his alleged mishandling of a medfly infestation of the state's fruit farms sent his approval ratings into a nosedive, and he was defeated by Republican Pete Wilson by a margin of 51 to 45 percent. Republican George Deukmejian won the governorship in 1982, succeeding Brown, and was reelected in 1986. After his Senate defeat in 1982, many considered Brown's political career to be over. During the 1980s, Brown traveled to Japan to study Buddhism, studying with Christian/Zen practitioner Hugo Enomiya-Lassalle under Yamada Koun-roshi. He also visited Mother Teresa in Calcutta, India, where he ministered to the sick in one of her hospices.

Upon his return from abroad in 1988, he announced that he would stand as a candidate to become chairman of the California Democratic Party. Brown won the position in 1989 against the less experienced Steve Westly. Westly criticized Brown as the candidate of moneyed interests. Westly later went on to be enormously successful with eBay, served as California's State Controller from 2002-2006, and in 2006 ran in the Democratic primary for Governor, but lost to Phil Angelides.

Brown experienced an abbreviated tenure that could best be described as controversial. He greatly expanded the party's donor base and enlarged its coffers, with a focus on grassroots organizing and get out the vote drives, but was criticized for not spending enough money on TV ads, which was felt to have contributed to Democratic losses in several close races in 1990. In early 1991, Brown abruptly resigned his post and announced that he would run for the Senate seat held by the retiring Alan Cranston. Although Brown consistently led in the polls for both the nomination and the general election, he quickly abandoned the campaign, deciding instead to run for the presidency for a third time.

1992 presidential campaign

When he announced his intention to run for president against President George H.W. Bush, many in the media and his own party dismissed his campaign as an ego-trip with little chance of gaining significant support. Ignoring them, Brown embarked on an ultra-grassroots campaign to, in his words, "take back America from the confederacy of corruption, careerism, and campaign consulting in Washington". To the surprise of many, Brown was able to tap a populist streak in the Democratic Party.

In his stump speech, first used while officially announcing his candidacy on the steps of Independence Hall in Philadelphia, Pennsylvania, Brown told listeners that he would only be accepting campaign contributions from individuals and that he would accept no contribution over 100 dollars. Continuing with his populist reform theme, he assailed what he dubbed "the bipartisan Incumbent Party in Washington" and called for term limits for members of Congress. Citing various recent scandals on Capitol Hill, particularly the recent House banking scandal and the large congressional pay-raises from 1990, he promised to put an end to Congress being a "Stop-and-Shop for the monied special interests".

As he campaigned in various primary states, Brown would eventually expand his platform beyond a policy of strict campaign finance reform. Although he would focus on a variety of issues throughout the campaign, most especially his endorsement of living wage laws and his opposition to free trade agreements such as North American Free Trade Agreement (NAFTA), he mostly concentrated on his tax policy, which had been created specifically for him by Arthur Laffer, the famous supporter of supply-side economics who created the Laffer curve. This plan, which called for the replacement of the progressive income tax with a flat tax and a value added tax, both at a fixed 13% rate, was decried by his opponents as regressive. Nevertheless, it was endorsed by The New York Times, The New Republic, and Forbes, and its raising of taxes on corporations and elimination of various loopholes, which tended to favor the very wealthy, proved to be popular with voters. This was, perhaps, not surprising, as various opinion polls taken at the time found that as many as three-quarters of all Americans believed the current tax code to be unfairly biased toward the wealthy.

Quickly realizing that his campaign's limited budget meant that he could not afford to engage in conventional advertising, Brown began to use a mixture of alternative media and unusual fundraising techniques which was derided at the time as "silly", but would later be dubbed "revolutionary". Unable to pay for actual commercials, Brown used frequent cable television and talk radio interviews as a form of free media to get his message to the voters. In order to raise funds, he purchased a toll-free telephone number, which adorned all of his campaign paraphernalia. During the campaign, Brown's constant repetition of this number (at rallies, during interviews, and in the middle of debates), combined with the ultra-moralistic language he used, led some to describe him as a "political televangelist".

Despite poor showings in the Iowa caucus (1.6%) and the New Hampshire primary (8.0%), Brown soon managed to win narrow victories in Maine, Colorado, Nevada, Alaska, and Vermont, but he continued to be considered an also-ran for much of the campaign. It was not until shortly after Super Tuesday, when the field had been narrowed to Brown, former Senator Paul Tsongas of Massachusetts, and frontrunning Governor Bill Clinton of Arkansas, that Brown began to emerge as a major contender in the eyes of the press.

On March 17, Brown forced Tsongas from the race when he received a strong third-place showing in the Illinois primary and then defeated the senator for second place in the Michigan primary by a wide margin. Exactly one week later, he cemented his position as a major threat to Clinton when he eked out a narrow win in the bitterly-fought Connecticut primary.

As the press now focused on the primaries in New York and Wisconsin, which were both to be held on the same day, Brown, who had taken the lead in polls in both states, made a serious gaffe: he announced to an audience of various leaders of New York City's Jewish community that, if nominated, he would consider the Reverend Jesse Jackson as a vice-presidential candidate. Jackson, who had made a pair of anti-Semitic comments about Jews in general and New York City's Jews in particular while running for president in 1984, was still a widely hated figure in that community and Brown's polling numbers suffered. On April 7, he lost narrowly to Bill Clinton in Wisconsin (37-34), and dramatically in New York (41-26).

Although Brown continued to campaign in a number of states, he won no further primaries. Despite this, he still had a sizable number of delegates, and a big win in his home state of California would deprive Clinton of sufficient support to win the nomination, which Brown apparently thought would revert to him by default. After nearly a month of intense campaigning and multiple debates between the two candidates, Clinton managed to defeat Brown in this final primary by a margin of 48% to 41%. Although he did not win the nomination, Brown was able to boast of one accomplishment: At the following month's Democratic National Convention, he received the votes of 596 delegates on the first ballot, more than any other candidate but Clinton.

Radio show host

Beginning in 1995, Brown hosted a daily call-in talk show on the local Pacifica Radio station, KPFA-FM, in Berkeley. Both the radio program and Brown's political action organization, based in Oakland, were called We the People. His programs, usually featuring invited guests, generally explored alternative views on a wide range of social and political issues, from education and health care to spirituality and the death penalty. He strongly critiqued both the Democratic and Republican parties, often referring to himself as a "recovering politician" (a phrase intended as an analogy to the term "recovering alcoholic").

Mayor of Oakland

In early 1998, Brown announced that he was leaving the Democratic Party and changed his party registration to "Decline To State". He terminated his radio show that same year in order to run for the nonpartisan office of Mayor of Oakland. (All municipal and county offices in California are by law nonpartisan, but candidates can be registered with any party they wish.)

In June 1998, he was elected mayor of the city of Oakland, and took office in January 1999. Prior to taking office, Brown also campaigned to get the approval of the electorate to convert Oakland's weak mayor political structure (the mayor as chairman of the city council and official greeter) to a strong mayor structure (the mayor as chief executive over the nonpolitical city manager and thus the various city departments and not a council member). This strong mayor structure in many ways is similar to that of the nearby city of San Francisco. Within a few weeks of his inauguration, one of his first acts as Mayor of Oakland was to invite the United States Marine Corps to stage war games titled Urban Warrior in the defunct Oakland Army Base and on the closed grounds of the Oak Knoll Naval Hospital after the National Park Service rejected the Marines' request to use Crissy Field in San Francisco. Hundreds of Oakland citizens and anti-military activists rallied against the exercise. Other efforts included acquiring millions of dollars in state and federal funding to open two charter schools. Brown also formulated the 10k Plan to attract 10,000 new residents to the City's downtown and this was a Major campaign bullet for his re election, an effort still to be fulfilled. Brown was reelected with over 60 percent of the vote in 2002.

Much to the dismay and anger of his liberal supporters, Brown's politics as Mayor of Oakland were more centrist. He explained this ideological shift as dealing with the realities of being a big-city mayor with real problems. After having left the Democratic Party because he felt that it no longer stood up for progressive ideals, Brown re-registered as a Democrat shortly thereafter. In 2000, Brown endorsed Al Gore for President shortly before the California primary.

In 2003, Brown and fellow Democratic Mayor Jim Hahn of Los Angeles praised Republican Governor Arnold Schwarzenegger for his decisive actions regarding the suppression of the reinstitution of portions of the vehicle registration fee (labeled by opponents as the "car tax") and some restoration of state funding for city governments, implying that Gray Davis (who had been Governor Brown's Chief of Staff in the 1970s) had acted poorly in this regard.

Attorney General

Election

In early 2004, Brown expressed his interest to be a candidate for the Democratic nomination for Attorney General of California in the 2006 election. On May 18, 2004, he formally filed the necessary papers to begin his campaign for the nomination, including a sworn declaration with the statement "I meet the statutory and constitutional qualifications for this office (including, but not limited to, citizenship, residency, and party affiliation, if required)".

Brown had an active Democratic primary opponent, Los Angeles City Attorney Rocky Delgadillo. Delgadillo put most of his money into TV ads attacking Brown and spent $4.1 million on the primary campaign. Brown defeated Delgadillo, 63% to 37%. In the general election, Brown defeated Republican State Senator Charles Poochigian 56.3% to 38.2%, which was the largest margin of victory in any statewide California race except the US Senate in which Dianne Feinstein's opponent did not mount a strong challenge.

In the final weeks leading up to Election Day, Brown's eligibility to run for Attorney General was challenged in what Brown called a "political stunt by a Republican office seeker" (Contra Costa County Republican Central Committee chairman and state GOP vice-chair candidate Tom Del Beccaro). Republican plaintiffs claimed Brown did not meet California's eligibility requirements for the office of Attorney General: according to California Government Code §12503, "No person shall be eligible to the office of Attorney General unless he shall have been admitted to practice before the Supreme Court of the state for a period of at least five years immediately preceding his election or appointment to such office." Legal analysts called the lawsuit "frivolous" because Brown was admitted to practice law in the State of California on June 14, 1965, and had been so admitted to practice ever since. Although ineligible to practice law because of his voluntary "inactive status" in the State Bar of California from January 1, 1997 to May 1, 2003, he was nevertheless still "admitted to practice". Because of this difference the case was eventually thrown out.

Norman Hsu affair

Attorney General Brown's office played a role in events surrounding prominent Democratic Party fundraiser Norman Hsu in 2007. Hsu had voluntarily returned to California in response to a 1992 warrant for failing to appear for sentencing in a fraud conviction. Brown's office negotiated a 50% reduction in bail with Hsu's attorneys, but the court did not accept the agreement and imposed the full $2 million bail specified in the arrest warrant. Additionally, Brown's office did not challenge releasing Hsu on bail without turning in his passport. After being released on bail, Hsu fled the state with his passport. Hsu was quickly apprehended by federal authorities in Colorado.

Brown received a $3,000 political contribution from an associate of Norman Hsu in 2005, and a lawsuit filed against Hsu by an Orange County investment company alleged that Brown praised Hsu at a 2006 Democratic Party event. Brown's spokesman stated that Brown may have stopped briefly at the event but did not praise Hsu "or in any way vouch for him."

Future political plans

Amid speculation that he may run for a third term as Governor in 2010, following the expiration of Schwarzenegger's current term, Brown has indicated he is open to the prospect.

Electoral history

Personal life

A bachelor as governor and mayor, Brown achieved some prominence in gossip columns for dating high-profile women, the most notable of whom was the singer Linda Ronstadt.

Brown also had a long friendship with Lorenzo Jacques Barzaghi, his aide-de-camp, whom he met in the early 1970s and put on his payroll. According to author Roger Rapaport, writing in California Dreaming 1982, "this combination clerk, chauffeur, fashion consultant, decorator and trusted friend had no discernible powers. Yet late at night, after everyone had gone home to their families and TV consoles, it was Jacques who lingered in the Secretary (of state's) office."

Barzaghi lived with Brown in the warehouse in Jack London Square, and was brought into Oakland city government upon Brown's election as mayor in 1998, where Barzaghi first acted as the mayor's armed bodyguard. Brown later awarded Barzaghi with high paying city jobs, including "Arts Director." Brown dismissed Barzaghi in July 2004.

In March 2005, Brown announced his engagement to his partner since 1990, Anne Gust, former chief counsel for Gap. They were married on June 18 in a ceremony officiated by Senator Dianne Feinstein in the Rotunda Building in downtown Oakland. They had a second, religious ceremony later in the day in the Roman Catholic church in San Francisco where Brown's parents had been married. Brown and Gust live near downtown Oakland, at the former Sears Roebuck Building, with their black Labrador, Dharma.

Political criticism of Brown

As Governor, Brown proposed the establishment of a state space academy and the purchasing of a satellite that would be launched into orbit to provide emergency communications for the state—a proposal similar to one that would indeed eventually be adopted by the state. In 1978, Mike Royko, at the time a Chicago Sun-Times columnist, nicknamed Brown "Governor Moonbeam" because of the latter idea. The nickname quickly became associated with his quirky politics, which were considered eccentric by some in California and the rest of the nation. In 1992, almost 15 years later, Royko would disavow the nickname, proclaiming Brown to be "just as serious" as any other politician.

The song "California Uber Alles" by the Dead Kennedys is sung from the perspective of Jerry Brown during his tenure as Governor. The song has Brown painting a picture of a hippie-fascist state, satirizing what they considered his mandating of liberal ideas in a fascist manner.

In 2006, the murder rate in Oakland in the first two months was triple the same period in 2005, leading some critics to suggest that Brown had failed to make the city safer. Violent crime decreased by a third during his tenure, however, and he attempted to enact several anti-crime programs, including a night curfew for convicted felons which was not implemented. His campaigns to fix the schools, fill downtown with residents, create an "arts" city and curb crime have had mixed success.

References

Bibliography

  • Bollins, John C. and Robert G. Williams. Jerry Brown: In a Plain Brown Wrapper (Pacific Palisades, California: Palisades Publishers, 1978). ISBN 0-913530-12-3
  • Rapaport, Roger. California Dreaming: The Political Odyssey of Pat & Jerry Brown (Nolo Press Berkeley CA 1982) ISBN 0-917316-48-7
  • Brown, Jerry. Dialogues (Berkeley, California: Berkeley Hills Books, 1998). ISBN 0-9653774-9-0
  • Lorenz, J. D. Jerry Brown: The Man on the White Horse (Boston: Houghton Mifflin Co, 1978). ISBN 0-395-25767-0
  • McDonald, Heather. "Jerry Brown’s No-Nonsense New Age for Oakland", City Journal, Vol. 9, No. 4, Autumn 1999.
  • Pack, Robert. Jerry Brown, The Philosopher-Prince (New York: Stein and Day, 1978). ISBN 0-8128-2437-7
  • Schell, Orville. Brown (New York: Random House, 1978). ISBN 0-394-41043-2

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