Wealth and Poverty in California and Tennessee

Bill Watkins
Executive Director of the Center for Economic Research and Forecasting at California Lutheran University

Over the past 18 months, I’ve spent a lot of time in East Tennessee, Appalachia if you will. You can’t avoid poverty in East Tennessee. It’s pretty much everywhere. A large, and obviously expensive, home may have a trailer next door, a trailer so dilapidated that you are sure no one lives there. But, someone does live there. You may see a light at the porch, or a car, or a satellite antenna. Sometimes, you run into a pocket of such homes. They call them Hollows.

If you go to an event with a large crowd, you hear language that sounds almost foreign –, things like “Where was you?” or “Them cows ain’t mine.”

A Californian can easily conclude that poverty in East Tennessee is a far worse problem than it is in California. But that’s not true.

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Stay and Run for U.S. Senate, Joe!

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

MEMO

To: Joe Biden
From: Joe Mathews
Re: California, Here You Come

You cut a happy, glad-handling swath through California last week and got great reviews.

In this era dominated by cold, strategic and distant California politicians, genuine human warmth and hugs were refreshing. And you seemed to enjoy yourself too.

So why don’t we make this more than a visit, Mr. Vice President?

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The Coming Revenue Debate Must Look Beyond Politics

Justin Ewers
Deputy Director of Policy and Communications for the California Economic Summit

With more than a dozen major tax measures moving through the Legislature or toward the November 2016 ballot, California’s perennial debate about taxes is set to begin anew—with millions of dollars in political campaigns preparing to shape how the state will raise billions of dollars in revenue, and provide public services, for years to come.

In a report released yesterday, From Revenue to Results: Considering today’s tax proposalsCA Fwd aims to broaden this pivotal conversation, encouraging Californians to look beyond how much money each measure would raise and who would pay—and to consider the proposals’ combined fiscal, governance, and policy impacts, as well. After providing a detailed look at this year’s major tax ideas, the report defines a set of criteria for assessing their strengths and weaknesses—and outlines what a tax system that meets the criteria might look like.

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Can LA Afford Another Olympics?

Jack Humphreville
LA Watchdog writer for CityWatch, President of the DWP Advocacy Committee, Ratepayer Advocate for the Greater Wilshire Neighborhood Council, and Publisher of the Recycler

Boston bailed on hosting the 2024 Olympics when Mayor Martin Walsh refused to sign a host city contract with the United States Olympic Committee (“USOC”) that would have put Beantown (and possibly the Commonwealth of Massachusetts) on the hook for any cost overruns associated with this 17 day extravaganza.  But Walsh’s refusal to mortgage Boston’s future was understandable given the unfavorable economics associated with this over hyped event.

According to an article in Harvard Magazine, A Fiscal Faustian Bargain” by Professor Andrew Zimbalist, perhaps the foremost analyst of public investments in sports facilities and global athletic competitions, the cost is expected to exceed $15 billion.  This includes operating costs during the games, the construction of new venues, infrastructure improvements, and security. 

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Who Holds Superior Rights, And Where Is All That Water Going?

Aubrey Bettencourt
Executive Director, California Water Alliance

In the regulatory realm, responsible due process follows a simple path: Legislation creates a statute granting authority; that authority sets regulation and conforming orders; violations of orders result in a notice; notice leads to demonstration of wrongdoing; and wrongdoing leads to punishment.

Within this framework, courts interpret how the players conduct themselves. Our constitution gives the judicial system the authority to put any player in the penalty box if they misbehave.

But somehow this reality is lost on the State Water Resources Control Board (SWRCB).

SWRCB recently told holders of 9,018 junior and senior water rights to stop diverting water from California’s rivers and streams. The SWRCB deputy counsel and lawyers said in court filings and to the media that it’s because ‘there isn’t enough water to go around for everyone with water rights.’

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The Cigarette Tax Dilemma

Joel Fox
Editor of Fox & Hounds and President of the Small Business Action Committee

Is a tax on cigarettes a revenue raiser or a “sin tax”—used to discourage individuals from using products considered harmful? The effort to raise taxes on cigarettes – there is a measure in the legislature as well a ballot initiative moving through the process—often directs new revenues toward specific purposes. Yet, the increased taxes often lower the use of a product thus reducing the revenue for organizations and agencies.

Last, week the Los Angeles Times reported that the First 5 committee, which received funding from a previous cigarette tax increase, was concerned that fewer smokers meant less revenue. The First 5 group, which focuses on improving early years of children’s lives, is attempting to rally the legislature to add revenue from any new cigarette tax to include First 5 in those groups that receive new revenue.

But the cycle will certainly continue for First 5 and any agency that receives cigarette money. A tax increase will likely once again reduce the number of smokers and cigarette purchases and at some point reduce the revenue agencies expect to receive.

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The Cities Leading A U.S. Manufacturing Revival

Joel Kotkin, Editor of NewGeography.com and Presidential fellow in urban futures at Chapman University, and Michael Shires, Associate Professor of Public Policy, Pepperdine University

Manufacturing may no longer drive the U.S. economy, but industrial growth remains a powerful force in many regions of the country. Industrial employment has surged over the past five years, with the sector adding some 855,000 new jobs, a 7.5% expansion.

Several factors are driving this trend, including rising wages in China, the energy boom and a growing need to respond more quickly to local customer demand and the changing marketplace.

To generate our rankings of the best places for manufacturing jobs, we evaluated the 373 metropolitan statistical areas for which the U.S. Bureau of Labor Statistics has complete data over the past decade. Our rankings factor in manufacturing employment growth over the long term (2003-14), medium term (2009-14) and the last two years, as well as momentum.

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Unlawful Immigrants Rush For CA Drivers Licenses

James Poulos
Staff Columnist, Orange County Register

Emerging statistics have revealed that California’s extension of drivers licenses to unlawful immigrants aroused unexpected demand — with no end in sight.

“While state officials expected 1.4 million undocumented immigrants to apply for licenses in the first three years, in the first six months since the law has been enacted more than 1.1 million undocumented immigrants have so far taken the written test, and another 436,000 have taken the driving test,” reported Fox News Latino.

“During the first six months that the Safe Driver and Responsibility Act — or AB 60 — went into effect, the Department of Motor Vehicles saw more than 600,000 applications from undocumented immigrants,” the Los Angeles Daily News observed. DMV officials announced that, in the first half of the year, some 397,000 licenses have been issued to unlawfully present immigrants — half the total of roughly 759,000 licenses issued, according to the Associated Press.

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Trump Impact—Overblown?

Sherry Bebitch Jeffe & Doug Jeffe
Sherry Bebitch Jeffe, Professor of the Practice of Public Policy Communication, Sol Price School of Public Policy and Doug Jeffe, Communications and Public Affairs Strategist

As if politics weren’t crazy enough this year, Donald Trump has brought his unreality show to the 2016 Presidential race.   Trump’s buffoonery has captured the attention of the media and the hearts of more than a few grumpy voters, at least for a while.   But those who worry (Republicans) or hope (Democrats) that Trump’s antics will finally, totally, destroy GOP chances of winning a viable share of Latino voters in 2016 should take a deep breath.

Comparisons of Donald Trump in 2015 to then-Governor Pete Wilson in 1994, currently bouncing around social media and cable chat shows, aren’t valid. Pete Wilson was fighting for his re-election as California’s governor–and for his political life, when he embraced Proposition 187, which would have denied health and education services to undocumented immigrants.

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Regulating Marijuana

Patrick Murphy and Lunna Lopes
Patrick Murphy is Director of Research and Senior Fellow at PPIC. Lunna Lopes is Research Associate at PPIC.

MurphyLopes_MarijuanaIn all likelihood, California voters will be asked to decide the legal status of marijuana on the 2016 ballot. Advocates of legalization are hoping to build on the momentum in four states (Alaska, Colorado, Oregon, and Washington) and the District of Columbia that made the recreational use of marijuana legal. Two national advocacy organizations—the Drug Policy Alliance and the Marijuana Policy Project—have made California a major focus for the 2016 election year.

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