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State of the State: Fat Times While Waiting for the Thin Cows

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

Governor Jerry Brown did a bit of crowing over his political successes while laying out an aggressive agenda in his State of the State speech. The governor declared the state fixed – premature at best when you consider the unfunded liabilities and the state’s still high unemployment. While I leave it to others to analyze the speech’s content with political realities, let me focus on three issues the governor raised with which I have clear agreement: saving for a rainy day, limiting the number of laws produced by the legislature, and spurring business and job growth.

In applauding the voters’ support for the Proposition 30 tax increase, the governor noted that the tax runs for seven years – a time equal to both the periods of good times and difficult times in the Biblical story of Joseph’s interpretation of the ancient Egyptian Pharaoh’s dream.  Joseph said the dream, which saw seven fat cows consumed by seven thin cows, signified that Egypt would enjoy seven years of plenty followed by seven years of famine. Joseph warned the Pharaoh to put aside grain for the coming tough times. The governor urged the legislature to “guard jealously” the people’s grant of additional tax revenue.

“Fiscal discipline is not the enemy of our good intentions but the basis of realizing them,” he said. Brown argued that it was cruel to expand programs only to cut them back when revenues disappear.

The governor urged the legislature to follow the lesson of Joseph: “Pay down our debts and store up reserves against the leaner times that will surely follow.”

Let’s hope the legislature pays heed. Setting funds aside for rainy days has been an on-going struggle in California. During the campaign for a ballot measure in 1988 that contained a provision for a rainy day fund, I used the same parable as the governor, employing the story of Joseph in my many speeches urging support for a rainy day fund. That measure failed, as did another in 2009 that I supported, which also contained a rainy day fund. The legislature has put off a rainy day fund measure to the 2014 election that originally was supposed to appear on the 2012 ballot. Can the governor finally convince legislators and voters to put a solid rainy day fund in place?

Comparing the Ten Commandments to the state’s education code, Brown admonished legislators from micromanaging the state with too many laws. Good for him. I’ve often thought the term “lawmaker” is a disservice to the voters who elect representatives. Managing the government doesn’t require so many new laws. We have enough already. One step in the right direction would be to prohibit lawmakers attaching their names to new laws. If there is no (Fill in a Legislator’s Name) Act for whatever, there may be less incentive for lawmakers to leave their mark by creating new laws.

“Constantly expanding the coercive power of government by adding each year so many minute prescriptions to an already turgid and detailed legal system overshadows other aspects of public service,” the governor stated. The governor urged that legislators “inspire and organize people” rather than command them with new laws.

Brown went on to make his argument that education laws must be reduced and education governed closer to the classroom rather than on high from Sacramento.

On the important issue of business and job growth, the governor said California is coming back from its over 1-million job loss in the Great Recession, lauding the efforts of Go Biz to assist businesses in the state or to come to the state.  However, Republican elected officials were particularly concerned that no new plans for job creation were advanced in the speech.

The governor mentioned reforming CEQA to create greater certainty for business and cut needless delays. He also promoted increased trade with China in discussing his planned trip to China to open a new trade office in Shanghai this spring.

Business growth and jobs are the keys to continuing the state’s rise. The governor’s tax increase runs for seven years. Will the state get in shape to deal with what comes after when the tax increase stops and the thin cows might be standing at the gate?

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