An Inaugural Day that Jumbles Fiscal Stewardship and Costly Promises

Joel Fox
Editor and Co-Publisher of Fox and Hounds Daily

In his inaugural address, Governor Gavin Newsom promised his administration would be “prudent stewards of taxpayer dollars.” But he raised challenges to that approach immediately not only in the speech, but also with his first post-inaugural pronouncements on expanding health care programs.

In his address, Newsom promised to “launch a Marshall Plan for affordable housing and lift up the fight against homelessness from a local matter to a state-wide mission.” That sounds like another new costly state program.

Soon after his inaugural address, Newsom’s team revealed that he would seek a health care mandate based on the Obamacare model and expand Medi-Cal for undocumented youth aged 19 to 26.

Did Newsom announce his first tax increase with this announcement? After all, the mandate as part of Obamacare was ruled a tax when U.S. Chief Justice John Roberts and the Supreme Court majority ruled that Obamacare’s mandate provision came under Congress’s taxing powers. The mandate provision in Newsomcare also could be classified a tax.

Newsom previously promised money for pre-K education.

New state programs; taxing mandates—how sensible will this administration be with taxpayers’ dollars?

Perhaps, Newsom’s solution for funding new ventures is to build an even stronger economy. He suggested that possibility in recognizing California as a “giant engine of commerce” saying it provides the resources “to ensure a decent standard of living for all.”

He also spoke of his history with small business and praised the entrepreneurial spirit.

If business success is what he is counting on to help fund some of the state’s new ventures, besides offering new programs at the start of his administration he should also set out relief for small business from difficult regulations and predatory lawsuits. Giving businesses time to correct slight flaws in dealing with cumbersome labor laws and restricting Private Attorney General Act lawsuits would be a good place to start.

Despite all the promised bold actions, the governor also acknowledged the problems he faces are hard to solve and that, “The results of our work may not be evident for a long time.”

That statement recognizes political reality but how will it sit with his progressive constituencies that demand progress now?

Governor Newsom mapped a demanding course for being both a prudent steward of tax dollars with so many promises that cost money.

 

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