Adventure is worthwhile - Aesop

Friday, March 05, 2010

Yesterday was a “Day of Action to Defend Education” in California.  Students and faculty marched in protest of budget cuts to the California University system.  But, as Megan McArdle quipped, they are really protesting reality.  Here’s the WSJ:

If you went searching for the proximate cause of the “Strike and Day of Action to Defend Education,” you wouldn’t find it in any pattern of oppression. You’d find it in a couple of acts of desperation last year. First, Gov. Arnold Schwarzenegger, facing the worst budget crisis in state history, cut about $600 million in overall funding for 10-campus University of California and the 23-campus California State University. Then the U.C. regents and C.S.U. trustees, facing budget crises of their own, reduced programs, furloughed workers, and raised tuition.

...

Despite the budget cuts, California will this year devote $3 billion to the U.C. system. That’s about $13,000 per student—more than the $10,000 per student that Illinois devotes to the University of Illinois and better than double the $6,000 per student that New York devotes to the SUNY system. Yet Mr. Schwarzenegger did not denounce the agitation at Berkeley. He gave in to it.

Robinson takes apart the glib comparisons to the Vietnam protests:

We have here the vocabulary of the peace movement, of the struggle for decent conditions for migrants and other exploited workers, and of the civil-rights movement. Yet what did the protesters demand? Peace? Human rights? No. Money. And for whom? For the downtrodden and oppressed? No. For themselves. At a time when one American in 10 is unemployed and historic deficits burden both the federal government and many of the states, the protesters attempted to game the political system. They engaged in a resource grab.

Even Stephen Bainbridge, who, like many faculty, is taking a pay cut, is having none of this.  He particularly takes issue with the desperate attempts by the protesters to inject race into it (come on, you saw this coming).

The UC system was one of the first in the country to adopt affirmative action programs. Granted, Proposition 209 resulted in a decline in black and hispanic enrollment at the UC schools. Yet, the regents and virtually all administrators have consistently opposed 209. Indeed, many suspect that policies like comprehensive admission review were intended to end-run (some would say cheat) Prop 209.

Look. I’m as frustrated as an UC stakeholder with the state of affairs. It would be nice, however, if our students could put their energy to something more useful than unconstructive whining.

Now, I’ll pause while you re-read the links HL and I posted on the Greek situation, where protests over exploding over cuts in bonuses for government employees.

California education is supposed to be free, but that hasn’t been the case for a while.  The students are screaming about fees going up 32%, but that’s only because they were so low to begin with.  As noted above, they are getting ten grand a piece from the State.  Maybe numbers are different in California.  But where I come from, ten grand can buy one hell of an education (to say nothing of grants, scholarships and the Federal government’s open-ended commitment to cheap subsidized loans).

We’re again seeing the entitlement mentality at its worst.  Maybe it’s not fair that the State is failing to fulfill its supposed commitment to free higher ed.  But that’s the way things are, fair or unfair.  If the students want to really vent their frustration, why don’t they go the state employee’s unions who are sucking the state coffers dry?

Tuesday, February 09, 2010

This, the government would screw them over. What’s the “this” in this case?

The Department of Health Care Services said Monday it has breached the privacy of 49,352 people who receive adult day-care services from the state. The department said that letters it mailed a week ago to 49,352 Medi-Cal beneficiaries wrongly included each patient’s Social Security number on their address labels. The department said the security incident took place Feb. 1, but it was only told about it on Thursday. It started to notify the 49,352 beneficiaries about the problem over the weekend.

I worked in the health insurance industry and such a mistake by a private company could cost them as much as $250K per incident. How are the bureaucrats in Cali reacting to their gross incompetence?

“At this point, there is no evidence that unauthorized parties have acquired or accessed beneficiary personal information,” the department said in a prepared statement. DHCS officials said they regretted the breach, which has so far cost the state $50,000. It blamed itself and a private vendor for the problem mailings.

These people will be lucky if they get a free credit report, and considering Cali’s financial situation, I would not be surprised the state tries to make money of this mistake. Of course, the big lesson here is that these are the people that the left wants you to believe will do a better job running our healthcare too. I am sure they can also pawn the blame off on some unamed “vendor” when they hose us over.

Friday, January 22, 2010

There’s dumb and then there’s California dumb:

A key legislative committee in California revived a bill Thursday to create a government-run health care system in the nation’s most populous state, two days after Massachusetts elected a senator who opposes the president’s national health care plan.

The Senate Appropriations Committee released the bill for a vote by the full Senate next week. The legislation had been held over from last year because of the state’s ongoing budget crisis.

Creating a single-payer system would cost California an estimated $210 billion in its first year. That’s roughly double the size of the total state budget, but about what the state and federal government and residents cumulatively spend now on California health care, said Sen. Mark Leno.

Leno, D-San Francisco, introduced the bill after Gov. Arnold Schwarzenegger twice vetoed similar legislation. The Republican governor negotiated his own $14.7 billion health care reform bill with Democratic leaders two years ago, only to see the measure fail in a Senate committee amid concerns over paying for the measure.

Leno’s bill would create a commission to decide how to pay for the system, at a cost this year of more than $1 million.

My jaw is on the floor here.  We have a state that has been bankrupted by spending, that has raised taxes to the point of driving their tax base away to more hospital environment, like 6000 feet under the Pacific and that is still $20 billion in deficit.  Now they want to put in place a $210 fucking billion socialized medicine program.  And they don’t know how to pay for it.  They want a commission to figure that out.

California.  You are doomed.  Will the last working person in the State please notify the unemployment office?

Friday, November 13, 2009

By now you surely have heard that ACRON is suing the Federal government. They are doing so because they are mad that the feds took away all of its slush funds after their shady dealings and practices were exposed. What about the fact that Jerry Brown was caught admitting that his office’s investigations of ACORN in CA was nothing but a big sham with a forgone conclusion of ACORN’s innocence? The fact is that ACORN is under investigation even by the Feds, and in plenty of other states. What do you mean you have not heard any of this? Why would the MSM ignore such a huge story? This stuff permeates every branch of the current bunch running the country.

I know you know why. I was just making a point again that we are being manipulated for real by a complicit media. Remember the good old days when we were told the Bush government was misinforming us and how hard the MSM members worked at finding proof of that? These same tools are now doing their best to ignore the real and criminal activities of the democrats and their allies. They are even apologizing and covering for the WH which is neck deep in this cesspool. Heck, Obama got elected by the efforts to rig the electoral process, many of them criminal, by ACORN. And with the current record by either the MSM or the donkey controlled Feds of dismissing things that are harmful to the left’s agenda, one has to wonder if these investigations will be as thorough as those in the MSM - the MSM continues to ignore this story, the connection of ACORN to SEIU, and to the democrats all the way up into the WH which has decided it no longer needs to disclose its dealings with the unions – or are simply another bunch of sham investigations like that led by Jerry Brown in CA. Did I mention that even the damned donkeys are wondering about Brown?

Don’t take your eyes of what’s going on with ACORN people. We should not let the democrats save their criminal partners. Talk about silence when we are seeing some real culture of corruption…

Sunday, November 01, 2009

Is this even legal?

Starting Sunday, cash-strapped California will dig deeper into the pocketbooks of wage earners—holding back 10% more than it already does in state income taxes just as the biggest shopping season of the year kicks into gear.

Technically, it’s not a tax increase, even though it may feel like one when your next paycheck arrives. As part of a bundle of budget patches adopted in the summer, the state is taking more money now in withholding, even though workers’ annual tax bills won’t change.

Think of it as a forced, interest-free loan: You’ll be repaid any extra withholding in April. Those who would receive a refund anyway will receive a larger one, and those who owe taxes will owe less.

....

The extra withholding may seem like a small amount siphoned from each paycheck, but it adds up to a $1.7-billion fix for California’s deficit-riddled books.

From a single taxpayer earning $51,000 a year with no dependents, the state will be grabbing an extra $17.59 each month, according to state tax officials. A married person earning $90,000 with two dependents would receive $24.87 less in monthly pay.

The principle of the thing bothers me more than the amounts. As much as I would oppose a tax increase, at least that would be legitimate—and permanent (modulo high earners leaving the state).  But the way this is being pitched is that this will now be a permanent thing.  That, like Prometheus, the taxpayers will regularly have a part of their paycheck ripped out only to have it grow back every April.

This is just a shell game.  It’s moving small piles of money around to create the illusion of fiscal solvency.  It’s the sort of thing that, if a Wall Street firm did it, would land its CEO’s in jail.  Only in California would it be called “leadership”.

Tuesday, September 01, 2009

Unfortunately, the physical landscape of California is not the only thing going up in flames right now.  First, one of Canada’s trading exchanges sent out this delightful notice: (via Zerohedge)

Please be advised that there has been an unforeseen delay in renewing CDCC’s annual application with the State of California.

Due to this delay, CDCC options may not at this time and until further notice be sold or offered for sale in the state of California and to California residents until the annual application process is completed.

I’m no financial expert, but I’m pretty sure that’s trader-ese for “You’re broke, chumps--don’t call us, we’ll call you!”

And just to add injury to insult, the state needs a loan to pay their IOUs:

California State Treasurer Bill Lockyer announced that the banking giant is lending the state $1.5 billion to help it pay off IOUs.

The terms are very favorable to California, as the loan carries a 3 percent annual interest rate, lower than the 3.75 percent rate the state is paying on the IOUs. Also, Chase is not charging any fees.

How magnanimous of them!  But that’s not the best part:

The JP Morgan Chase loan matures on October 5, but Treasurer spokesman Tom Dresslar tells me the state hopes to pay it back before then. The Treasurer will begin selling short term revenue notes into the market, possibly by mid-September, and will use some of that money to repay the bank.

Get that?  One of Canada’s largest traders has “delayed” doing business with California or its residents (no doubt one of many to come), and now the state needs a loan from one of Bernanke’s bank brothel madams to cover the financial obligations that it couldn’t cover this summer.  A loan that it hopes to pay back.

This is what it’s like to watch a state slowly circle the drain financially. 

Monday, August 03, 2009

California is facing an unprecedented budget crisis.  The taxpayers have been squeezed so much, they’ve got permanent fingermarks on their throats.  The Governator is doing almost everything he can to keep the state from going under, including three-day furloughs of state employees.

So what to do?  That’s right, call a strike:

California’s largest state employees’ union voted on Saturday to approve a strike authorization measure to protest furloughs of state workers and pressure state officials to ratify its labor contract.

A spokesman for Service Employees International Union Local 1000 said a strike was not imminent but that the vote authorized union officers to initiate certain job actions, including a strike if necessary.

...

Earlier this week, the Republican governor signed a bill that closed a more than $24 billion budget gap. Under the legislation, furloughs will continue for state workers for three days a month, cutting their pay by 15 percent.

“We feel that he (Schwarzenegger) really undermined any kind of a contract deal by pushing these furloughs on folks,” Zamora said.

The SEIU said the strike authorization was approved by 74 percent of its membership.

Sometimes, I get asked why I hate unions so much.  I don’t hate them per se, except in and of the way that I hate the groupthink and mindless loyalty they encourage.  What I hate is the intersection of labor and politics—or, more precisely, the utter subservience of the Democratic Party to Big Labor.

SEIU wouldn’t try to pull this crap if they didn’t know that the media, the pundits and the Democrats had their back.  You can guarantee that there will be news stories about poor government workers struggling with their pay cut (as there were during the 1995 shutdown of the Federal government).  There will be none about California workers’ wages rising at twice the rate of the private sector.  You can guarantee impassioned speeches on behalf of workers on the legislative floor; none for the poor taxpayers or the unemployed whose businesses have been destroyed or driven off by taxation.

And so it goes.

Wednesday, July 22, 2009

Well can’t say I didn’t expect the angry politicians, deprived of the means to rob the people of California, well, the productive ones at least, of more of their hard earned dollars, to strike back at the ones demanding cuts. Forced to not use the only tactic they care to – increase taxes – these politicians, beholden to the people that survive by sucking the productive dry like vampires do their victims, the politicians have decided to sour the milk. If they need to cut spending to balance the budget, then what they will do is cut the spending that will cause the most harm and displease the most people, not cut the waste. Hence the threat to release 27,000 felons; to cut costs of course!

It’s not that these politicians don’t get it. They get it just fine. And they are pissed that the peasants have revolted and denied them their power. Instead of cutting the bloated bureaucracy and the waste, especially in the massive and ridiculous entitlement programs that cost Californians a fortune, they will cut critical services! That way the angry populace, fearing the effect of 27K felons released from prison – admit that the first thing that springs into the mind of normal people is that they are going to cause mayhem – will break down and allow them to do the only thing they really want: raise taxes. In that entire article I didn’t see a single effort to roll back the bloated social spending. The 3 day monthly furlough of unionized state workers isn’t even close to a solution: it’s a band aid over a stab wound to the carotid artery.

Californians better be aware that the people supposedly serving them see them as nothing but ATMs. The current tantrum is akin to that thrown by those that get mad that the bank dared to impose a fee on them taking out their money. Before you say that this analogy is off, remember that these politicians already believe that your money is theirs. That’s why they always feel the solution to any kind of budget gap is to tax you more. This is where the rest of the country is heading to. Only we do not have the protection of a Prop 13. Of course the people driving us over the cliff are saying they saved the day. They have to. Public opinion has turned as more and more people realize we are heading from the frying pan right into the bonfire. And since the America hating politicians in charge are not done pouring gasoline on the fire yet, to get it real hot and ready, so it can burn up the America they so hate and allow their collectivist banana republic to be born from its ashes, they need to snow the masses, for just a little bit more, to give them time to drive in that final nail or two into the coffin.

Cross posted at Wasting time with Alex

Thursday, July 09, 2009

If you’re a Democratic congressman, what do you do when you see the biggest state in the union fall billions short on their budget, even though they charge an additional tax on people’s taxes?  Why, copy thier methods, of course!: (via Bloomberg)

July 7 (Bloomberg)—House Ways and Means Committee members are likely to propose a surtax on high-income Americans to help pay for an overhaul of the health-care system, according to people familiar with the plan.....

Two people familiar with closed-door talks by committee Democrats said a House bill probably will include a surtax on incomes exceeding $250,000, as Congress seeks ways to pay for changes to a health-care system that accounts for almost 18 percent of the U.S. economy. By targeting wealthier Americans, a surtax may hold more appeal for House Democrats than a Senate proposal to tax some employer-provided health benefits.

If this is implemented, watch for what the baseline will be, then watch revenues plummet dramatically after the first year or two, as people find ways to earn less so they won’t have to pay this stupid surcharge.

The problem with the mantra “From each according to his ability, to each according to his need,” is that you need enough suckers with ability to provide for those in need.  The US is going to find this out sooner rather than later, particularly with a communist-sympathizing President in charge.

Wednesday, July 08, 2009

I have a little detail I want to add to HeartlessLibertarian’s excellent post on how the democrats are already talking about how a second stimulus package is needed, because the first one was an epic fail. Now most of us sane people that understand how collectivist economics work, or more importantly why this stuff never works, and understand how the real world works, predicted, and did so correctly, that we were about to throw a trillion dollars – add all the associated costs of printing up all this cash and the number is closer to $1.3 trillion – down a hole, and get no stimulus at all out of it. Forget the fact that this was simply a patronage bill, loaded with massive pork and a ton of cash for lobbyists, operatives, and past and future donors, and focus on what government has been doing. The amount of money that was actually going to do anything to stimulate the economy – by creating new jobs – was such a pittance that it might as well also have been given away to the friends of the democrats.

Monday, July 06, 2009

There has been a ton of meaningless drivel going around by the usual lefty propaganda outlets about how conservatives, and in particular Rush Limbaugh whom mentioned it back when, want Obama to fail. The meme is that conservatives are going to do things to make that so. Nothing could be further from the truth. In fact, unlike democrats/leftists, who do actually undermine things they do not like - see Iraq war 2003 to present for undisputable proof – as a matter of recourse, conservatives, notice I did not say republicans BTW, in general do not need to do anything to make the current Obamanomics policy fail. For proof, just look at California where Obamanomics has been the de facto policy for the last 2 decades.

July 6 (Bloomberg)—Last week, we discovered that the state of California will gladly pay you Tuesday for a hamburger today. With California mired in a budget crisis, largely the result of a political impasse that makes spending cuts and tax increases impossible, Controller John Chiang said the state planned to issue $3.3 billion in IOU’s in July alone. Instead of cash, those who do business with California will get slips of paper. The California morass has Democrats in Washington trembling. The reason is simple. If Obama’s health-care plan passes, then we may well end up paying for it with federal slips of paper worth less than California’s. Obama has bet everything on passing health care this year. The publicity surrounding the California debt fiasco almost assures his resounding defeat.

It takes years and years to make a mess as terrible as the California debacle, but the recipe is simple. All that you need is two political parties that are always willing to offer easy government solutions for every need of the voters, but never willing to make the tough decisions necessary to finance the government largess that results. Voters will occasionally change their allegiance from one party to the other, but the bacchanal will continue regardless of the names on the office doors. California has engaged in an orgy of spending, but, compared with our federal government, its legislators should feel chaste. The California deficit this year is now north of $26 billion. The U.S. federal deficit will be, according to the latest numbers, almost 70 times larger.

Bleak Picture

Bleak is an understatement. Remember that Obama and democrats ran and won big on picking at how horribly fiscally irresponsible the republicans had been during the Bush years. Well, Obamanomics is about to outdo those years and deficit spend in one year what it took Bush and the republicans 8 years to do. Have a look at how much money the Obamanomics plan is going to put us in the red by.

By the time Obama is done we will have tripled if not outright quadrupled our current deficit! And it is a guaranteed thing we will see nothing of the growth promised, unless you think a bigger government is equal to an economic boost, for all this spending.

The Obama administration has no shame, and is willing to abandon reason altogether to achieve its short-term political goals. Ronald Reagan ran up big deficits in part because he believed that his tax cuts would produce economic growth, and ultimately pay for themselves. He may well have been excessively optimistic about the merits of tax cuts, but at least he had a story.

Obama has no story. Nobody believes that his unprecedented expansion of the welfare state will lead to enough economic growth. Nobody believes that it will pay for itself. Everyone understands that higher spending today begets higher spending tomorrow. That means that his economic strategy simply doesn’t add up.

Character Deficit

And I should remind everyone that the above projections does not yet contain the massive, and drastically underestimated, costs of the Obama “Cap and Tax” and “Healthcare” plans. The first one is a massive new tax burden that serves but to enrich some politicians and their elected entourage of sell-out companies at the people’s expense. The second is a plan that I should add will do nothing but eventually make government the sole provider of healthcare, drastically reduce its quality and availability – to cut costs – and guarantee a level of intrusion and suppression of our personal freedoms that would be on par with the very tyrannical forms of government so many Americans died fighting off.

Can’t wait for the IOUs to be given to all these old Baby Boomer idiots that voted for this guy. Be it as their primary form of income as the economy continues to tank, as they find themselves looking for energy to meet their needs, or their critical healthcare needs as Obamacare becomes the law of the land. Hope and Change, indeed!

Cross posted at Wasting time with Alex

Update: Reader Miguelito asks:

Like others have already said here in the past: If the real goal is to destroy the capitalist system and fundamentally change the US.. then their strategy adds up perfectly.

In the words of Barack Obama himself:

“Generally, the narrow focus of the [Nuclear] Freeze movement as well as academic discussions of first versus second strike capabilities, suit the military-industrial interests, as they continue adding to their billion dollar erector sets.  When Peter Tosh sings that “everybody’s asking for peace, but nobody’s asking for justice,” one is forced to wonder whether disarmament or arms control issues, severed from economic and political issues, might be another instance of focusing on the symptoms of a problem instead of the disease itself.”

I Wonder how this would have played out if the MSM had disclosed this information before the election. In fact, it explains a lot about the current economic strategy pursued by the WH: destroy the economy and destroy the military capability. Then we can all smoke rope and sing Tosh songs about peace while we clamor for social justice.

I no longer doubt that when Biden says the WH underestimated the economic slump and the impact of their actions that they are lying. They created this crisis: they plan to take advantage of it too. And that’s your “Hope & Change” on a big steaming pile of doo.

Update 2: Manwhore brought up the issue of unions:

My personal opinion on how the state intends to do the inevitable is by doing things like issuing IOUs for services and making the work environments hostile in an effort to get some of these people to leave. Afterward they will lay off some people, and then cut services which will mean yet more layoffs.

I just happened to blog about that today:

Liberals love to tell us about the evils of capitalism, the greed of Wall Street, how the top people in big companies fleece us all, but nobody does it better than the liberal’s champion: government! Have a gander over to the WSJ and read about the underfunded Public Pensions and liabilities, and how big government is dealing with these problems:

Public employee pension plans are plagued by overgenerous benefits, chronic underfunding, and now trillion dollar stock-market losses. Based on their preferred accounting methods—which discount future liabilities based on high but uncertain returns projected for investments—these plans are underfunded nationally by around $310 billion.

Public pension administrators argue that government plans fundamentally differ from private sector pensions, since the government cannot go out of business. Even so, the only true advantage public pensions have over private plans is the ability to raise taxes. But as the Congressional Budget Office has pointed out in 2004, “The government does not have a capacity to bear risk on its own”—rather, government merely redistributes risk between taxpayers and beneficiaries, present and future.

Market valuation makes the costs of these potential tax increases explicit, while the public pension administrators’ approach, which obscures the possibility that the investment returns won’t achieve their goals, leaves taxpayers in the dark.

Get that? What’s good for the goose is not even close to being acceptable for the gander. No, really. And it gets worse: they don’t want us to know about it!

Some public pension administrators have a strategy, though: Keep taxpayers unsuspecting. The Montana Public Employees’ Retirement Board and the Montana Teachers’ Retirement System declare in a recent solicitation for actuarial services that “If the Primary Actuary or the Actuarial Firm supports [market valuation] for public pension plans, their proposal may be disqualified from further consideration.”

Scott Miller, legal counsel of the Montana Public Employees Board, was more straightforward: “The point is we aren’t interested in bringing in an actuary to pressure the board to adopt market value of liabilities theory.”

Enron was a greedy and evil corporation because of exactly this kind of stuff. However, government is not. That’s because these blood suckers figure they can always shaft the tax payer to cover their “exceedingly generous” debt obligations. And they need us to stay in the dark about it. This is the hope and change we are getting. Guess it pays to be part of the big government machine. Sucks bigtime otherwise. And we should not kid ourselves that Obama and his people would right now be nationalizing any private company doing what these public ones are doing, while demonizing capitalism, because they were abusing the public.

Tuesday, June 30, 2009

You know America is heading in the wrong direction when the Germans figure out they need tax cuts to create economic growth, the one and only indisputable proven way to do it BTW, while in America, the nanny state where the WH regulates lighting, the new spending and taxes keep on piling on and are already seen as game changers for the 2010 elections. Seriously. Our economy is imploding, government is doing its best to make it keep heading south, people are losing work left and right, and Obama’s priority, well other than having government grab control of healthcare for everyone but democrats and politicians, is lighting efficiency standards?

WASHINGTON—Aiming to keep the focus on climate change legislation, President Barack Obama put a plug in for administration efforts to make lamps and lighting equipment use less energy. “I know light bulbs may not seem sexy, but this simple action holds enormous promise because 7 percent of all the energy consumed in America is used to light our homes and businesses,” the president said, standing alongside Energy Secretary Steven Chu at the White House.

Obama said the new efficiency standards he was announcing for lamps would result in substantial savings between 2012 and 2042, saving consumers up to $4 billion annually, conserving enough energy to power every U.S. home for 10 months, reducing emissions equal to the amount produced by 166 million cars a year, and eliminating the need for as many as 14 coal-fired power plants.

Yeah, this sure makes me believe this is about stopping AGW. My bet is GE, or some other big democrat donor, has a new light bulb that nobody really wants and the WH is going to help them sell a lot of them. In return for a nice large donation, indirectly and well hidden, to the donkey’s campaign coffers, of course. This is not the first payback for services rendered, anyway. We Americans are now subsidizing “big and greedy” corporations, the ones democrats love to demonize but then cozy up with, and making them rich. All courtesy of that massive 1500 page bill, most of it still unwritten and definitely unread, that will stick US taxpayers with a $161 billion dollar annual tax hike, the largest single tax ever levied in our history, that was passed by the house, in the dark of night and by the hairs on Pelosi’s ugly mug, while the MSM had everyone focused on Michael Jackson’s freak death. Let’s hope the bill crashes and burns in the Senate. Today it’s California, a not too distant tomorrow considering where the collectivists are taking us, it will be the U.S. of A.

Cross posted at Wasting time with Alex

Tuesday, June 16, 2009

Democrats in the state of California seem hell bent on making sure the state fails. There is no other way to interpret their demand that all of the proposed $16 billion in cuts be done away with and for the $24 billion shortfall to entirely be made up with new taxes. You heard that right. The collectivists, in a down economy and at a time people are already fleeing California because of its draconian tax obligations, want to forego any kind of sacrifice on the part of their constituents, and are demanding more be taken from the already overburdened and fast dwindling productive in the private sector.

Have no doubt that this comes right back to democrats protecting their constituents: the large union blocks, first and foremost. Oh sure, in typical fashion, they are invoking suffering children and all that jazz, but the truth is that this is all smoke & mirrors. The democrats could give a rat’s ass about children. They do not get to vote, and vote for democrats. But admitting what you really are after is to protect the many public employee jobs at risk, at a time when people in the private sector are getting hammered, because of your dependency on them, will not fly well. So their solution is to raise taxes.

And these are more taxes. They have already raised taxes on Californians to the tune of $14 billion recently:

The latest tax proposal comes after six Republicans broke ranks with their party in February and approved $14 billion in tax increases to end a four-month impasse over how to close what was then a record $42 billion deficit. To fill that gap, lawmakers also agreed to cut $15 billion in spending.

So after they get the taxes they wanted in return for a promise to cut some of the brutal deficit with some spending reductions, the democrats now want to go back on their word and make it all up with new taxes. Talk about a royal shafting. I guess Californians, at least the ones not sucking at the government’s teat, are getting what they deserve from those they elected. Don’t worry America! This same stuff is coming our way courtesy of the federal government soon too…

Saturday, June 13, 2009

Can someone explain to me why we should bail out California?  Because all the reasons given sound like garbage to me.  I don’t mean to pick on this article in particular, but it’s a nice distillation of all the bullshit talking points I’ve been hearing.

The Golden State is beset by two significant problems. The first is macroeconomic; like every state in the Union, recession has meant increased demand for public services combined with a dramatic decline in tax revenues (though California’s problems have been magnified by the severity of its housing bust and recession).

Wrong.  The structural problem is that it massively increased spending during boom times and is now going off the very cliff its irrational fiscal policy built.  Every state is in a recession.  I will grant that California is worse owing to high taxes and a brutal regulatory environment.  But is it worse than, say, Michigan?  Is it worse than Florida, which also had a gigantic housing bubble?

The second problem is structural and institutional. California’s system of ballot measures has helped pile a growing load of spending commitments on the state, while the infamous Proposition 13 has made it all but impossible to raise taxes. The 1978 voter initiative limited property tax rates and set a statutory requirement of a two-thirds majority in both legislative houses for passage of any tax increase. Combined with a more-or-less permanent minority of rabidly anti-tax Republican legislators, California has found itself absolutely unable to fix its budget problems.

Wrong again.  California is one of the most intense tax environments in the nation and has raised taxes repeatedly since 1978.  Liberals, you need to learn to do the math on this.  Prop 13 is not your problem.  I will grant, however, that massive unfunded spending initiatives and the defeat of the Governator’s ballot proposals have a bad situation far worse.  But then again, supporting the spending and opposing the initiatives was the position of liberals, not conservatives.

We have to let California collapse so that they can get untangled from the hideous maze of union payrolls that has them tied down.  We have to let them fail because it will set a precedent to bail other states out.  We have to let them fail because, if we bail them out, they’ll just be back next year for more money.  This is not some sudden visitation of fate; this is a problem that has been building for a decade or more.

The response to this, on the other hand, is that California is simply too big to fail. And truthfully, it is. California is the world’s eighth largest economy, and it contributes roughly an eighth of total American output (and drives much of the output in surrounding states). It’s very difficult to imagine the European Union standing by and allowing a budget crisis to ravage the German economy, or the IMF doing nothing at all to assist a Russia or a Brazil as they melted down.

Nonsense.  California is not going to slide into the ocean because their government goes belly up and is forced to drastically cut services.  I like to think of budget cuts in terms of time.  If we set the budget of California back ten years, it would be balanced.  And clearly, California wasn’t dying ten years ago or even close to it.

Were California forced to make significant cuts to its spending, the ramifications could be quite serious. School systems and universities would be endangered (which would threaten the state’s long-term economic prospects). Increases in crime, homelessness, and serious poverty would encourage residents to leave. Service cuts could threaten key industries. In short, the recession could grow far more serious in the state than it already is. That would threaten recovery across the nation.

Standard liberal tripe.  California spends about half its budget on education, mostly on a bloated public school system that the fucking LA times recently documented has become nothing but a sinecure for loyal union members.  But that leaves half the budget that’s not education.  Why, when spending cuts are threatened, do liberals always want to cut education first?  Because they want to use children as human shields against the budget cutters.

Ideally, America could adopt a comprehensive policy that would apply to California and any other state which might find itself in trouble, but that might not be possible given constitutional constraints. At the very least, the principle should be established that aid comes with strings attached. The federal government should put together a bail-out package for California that can only be accessed if the state agrees to hold a constitutional convention, limits the scope of the convention to budget rules and ballot initiatives, and changes those rules in ways that sharply reduce the probability that this kind of structural issue will emerge again. To ensure California’s compliance, the federal government could declare that if the state refuses to call a convention, it will receive aid but will have its federal dollars—for things like transportation, military spending, housing, and so on—garnished significantly until reform is achieved

And when they fail to do anything?  California doesn’t need a Constitutional Convention.  They have the power to fix things now.  I don’t see any reason why the legislators would show more courage and less union genuflecting at a convention than they do right now.  Unless the convention is held in a secret location that the union can not surround and protest at, nothing will change.

Granted, a convention might free them from some constitutional restraints on the budget. But as the earlier (and incorrect) note on Prop 13 indicates, they will almost certainly use this freedom to raise taxes, not to get their bloated budget under control.

It may seem that I’m blaming California’s unions for California’s woes.  If I’ve given that impression, it’s because it’s what I believe.  If the union is going to boast that they run the state—and they do—they can take some responsibility for the pending fiscal apocalypse.

Wednesday, May 20, 2009

Good for California:

California Governor Arnold Schwarzenegger was dealt a crushing defeat as voters rejected a series of ballot initiatives designed to help plug the state’s spiraling budget deficit.

Schwarzenegger, a Republican, had argued forcefully in favor of six measures that would have allowed for increases in sales, income and vehicle taxes, as well as other moves such as pay freezes for elected officials.

Schwarzenegger had warned that failure of the proposals would leave California grappling with a budget shortfall of around 21.3 billion dollars.

But weary voters were unwilling to heed Schwarzenegger’s deficit warnings and came out broadly against the ballot proposals, by margins of around 60-70 percent to 40-30 percent, local media reported.

The libs are, of course, heartbroken.  And they do have a point.  Californians can’t have their cake (high spending) and it it too (low taxes).  But that’s a syndrome the entire nation is afflicted with.  The problem California is having, unlike the Feds, is that they can’t tax those who don’t vote—i.e, the unborn children who are really going to foot the bill for this—with big deficits or inflation.

In the end, this is going to come down to a fight between the taxpayers and the state employees’ unions.  My bet is that this ends in bankruptcy for California and either a direct bailout from the Feds or an indirect bailout through higher bond prices for the rest of the nation.