Sacramento’s Ongoing War Against Regular Californians
If you can afford a 19 percent increase in your electric bill, and are reading this column in a newspaper, you can move on to the sports section. The following will not be of interest to you.
However, if you are a low income, fixed income or even a middle class Californian, you are under assault from Sacramento. Sen. Joe Simitian, D-Palo Alto, has persuaded his colleagues to approve his bill to make energy even more expensive. The current mandate that energy companies get 20 percent of their power from “renewable” sources, will be raised to a third over the next eight years. This will result in an average utility rate increase of 19 percent, according the California Air Resources Board. This is on top of the existing mandate so that the total increased cost to Pacific Gas and Electric customers will be 44 percent, to Southern California Edison customers 34 percent and to those served by the Los Angeles Department of Water a Power it will be 74 percent.
Lunch with Jerry
Suppose an acquaintance invites you to lunch. You meet him in front of the restaurant where he announces that he is a little strapped for cash. Turns out he can’t host lunch, but he will split the bill with you. You feel uncomfortable because you are on a brown bag budget, but nevertheless agree.
During lunch, he does most of the talking. It is clear he is trying to impress you. When the bill arrives it amounts to twenty-six dollars. Your companion takes out his wallet and stares intently at its contents for a few moments, before mumbling he has only eight dollars. This is unsettling because you barely have enough money for half the bill. At this point he excuses himself to use the restroom. As you observe him, he crosses the room passes the restroom door and darts out an exit. That’s when the realization hits you that you will be spending the afternoon washing dishes.
You’ve just had lunch with Jerry Brown.
Time for Taxpayers to Take a Seat at the Table
A recent editorial cartoon sums up the tension between average taxpayers and government employee unions. It shows two guys sitting at a bar. One, head in hand and looking glum, is labeled “public sector” and he says to his companion, “They’re trying to cut our pensions…” The other fellow, labeled “private sector,” replies, “What’s a pension?”
If this bar is in California – where the official unemployment rate is 12.5 percent not including those who have completely given up looking for work – Mr. Private Sector might also ask, “What’s a job?”
Over time, how much of the public views those who work for government has changed from “respected civil servants” to “militant special interest” dedicated to preserving and expanding their “entitlements” at any cost to taxpayers. In this case, perception is reality.
Jerry on a Leash
Governor Brown has submitted a budget that he claims includes drastic spending cuts. And he has dropped the other sandal by announcing he will also seek massive tax hikes, a package of increases that are essentially the same as those overwhelmingly rejected by voters in May of 2009.
While the expert analysis of the budget plan continues, it has already become obvious that a number of items described as “cuts,” do not represent a decrease in spending, just tricky bookkeeping. For example, Brown shows a billion dollar pay down on the deficit by raiding the voter approved Proposition 10 tobacco tax that goes to support children’s services.
However, one does not need a green eyeshade to see that two areas of state spending that are being held sacrosanct are K-12 funding and prisons. In fact, if Brown’s plan is approved, the prison budget will be expanded from $8.9 billion to 9.1 billion, even though California already spends over twice as much per prisoner than does Texas, and much more than the national average.
Hardly a Transparent Budget
Jerry Brown is being applauded for bringing honesty to the California budget process. True, compared to his predecessor, his blunt talk is refreshing. (He abstains from using the word “fantastic” in every sentence). Also, he hasn’t minced words in describing the scope of the problem. But let’s deconstruct whether he has been entirely honest in his handling of the budget as well as the plan itself.
First, to the extent he was saying, “we had no idea it was this bad,” the reality is, yes he did. Everyone did. For years fiscal conservatives have warned about the impending disaster both in terms of overspending and the extraordinary level of debt being racked up by state, much of it consisting accounting maneuvers for the purpose of kicking the budget can down the road.
Second, during the campaign, he pointedly said that “everything is on the table.” But that’s not quite true either. His budget plan lacks any real reforms. Where is the pension reform? What will be done to blunt the power of the unions? What about more efficient ways to deliver public services? For example, why does California continue to spend twice the national average to incarcerate one prisoner for a year? The real answer to this is that he has refrained from putting anything “on the table” likely to anger the unions – the very interests that financed his campaign. (Sure, the unions will cry crocodile tears over the cuts, but there is nothing here that threatens their power).
Selling Assets the Wrong Way
Suppose a grinning real estate agent knocks on your door with a proposal. He will buy your home (which you own free and clear) for a fair price if, in return, you promise to spend all the proceeds within one year and agree to rent back your property over the next 20 years for an amount that exceeds what you were paid. At the end of 20 years you will have to arrange a new rental agreement or become homeless.
At this point most property owners would recognize a scam and some might even summon the family pit bull to make sure that the slick salesman beats a hasty retreat.
However, what is an obvious scam to average taxpayers is called sound public policy by Sacramento politicians.
What Will Brown Do?
California is circling the drain and the news keeps getting worse.
With unemployment at 12.4 percent – 2,269,948 people without jobs – it should come as no surprise that the state is upside down in its unemployment insurance fund. The deficit is expected to reach $10.3 billion by the end of the year as the state borrows $40 million dollars a day from the federal government to provide assistance to jobless workers. California must make an interest payment $362 million to the federal government next September. It’s one more obligation that leaves less money for programs like education, laws enforcement and transportation.
Then there is the latest projection from the Legislative Analyst’s Office showing the state with a budget deficit of $25.4 billion.
Just last month, when, with self congratulatory rhetoric, lawmakers concluded the budget for this year, it was obvious to all that it was a sham. I wrote at the time that only those “who had just put their life savings into Florida swampland,” would believe the rosy projections on which the budget was balanced.
Who is Rosy Projections?
Rosy Projections is a powerful player in state government, but when I asked around the Capitol for directions to her office, no one could help me. And I couldn’t find a listing for Ms. Projections in any of the political directories in Sacramento, either.
Still we know Rosy exists, because her fingerprints are all over the state budget.
Let’s see, the budget agreement includes the expectation that the federal government — out of the goodness of its heart — will chip in $5.3 billion dollars to shore up Californians’ profligate spending. Certainly that is proof of Rosy’s influence. And then there are the estimates of future revenue that would only be believed by someone who had just put their life savings into Florida swampland. Surely Rosy had a hand in this, too.
Prop. 25: New Front in Long War Against Prop. 13
Proposition 25 is the latest weapon against Proposition 13, but backers don’t want voters to know it.
Statewide polls taken in recent years consistently show Proposition 13
to be as popular as it was 32 years ago when it passed with nearly
two-thirds of the vote. While the general public supports the landmark
measure with its limitation on property tax increases and requirement
of a two-thirds vote of the Legislature to increase state taxes,
politicians and government employee union leaders continue to see
Proposition 13 as a barrier to their draining every dime from taxpayers.
Writing about the campaign to pass Proposition 13, the measure’s
author, Howard Jarvis, wrote, "Virtually all of the howlers against
Proposition 13 had their noses buried deeply in the public trough. They
were on a gravy train provided by the taxpayers, and they wanted to
ride that train at the taxpayers’ expense until they reached the
promised land of exorbitant pensions for the rest of their lives."
Howard Jarvis Was Crazy
The passage of Proposition 13 in 1978 changed the political landscape
both within California and nationally. Thirty-two years after its
passage, candidates for governor still vie to convince voters that they
are the strongest supporters of this landmark law. Undoubtedly, this
would make Prop 13 author Howard Jarvis very happy.
Ironically, 1978 was also the last time Jerry Brown ran for governor.
The "boy governor" was running for a second term against then Attorney
General Evelle Younger. The overwhelming 65% vote for Proposition 13
in the primary election spurred both candidates to scramble to be
identified with this big winner.
Brown, who had originally opposed the measure, and Younger, who had
given only lukewarm support, both approached Howard Jarvis asking him
to cut television spots on their behalf.