The Truth: California is in a Great Depression

Steve Frank
Publisher of California Political News and Views

Jack Nicholson had his most memorable statement in a movie, "A Few Good Men":

Kaffee: I want the truth!
Col. Jessep: [shouts] You can’t handle the truth!

Kaffee is really the people of California and the Colonel, played by Nicholson, are our Sacramento politicians.

Those in charge do not believe the people can handle the truth.

Here is the truth:

California unemployment (those unemployed, underemployed and have given up looking for employment) is NOT 12.3%, but north of 20%.

Our deficit, as of last month, was $20 billion–plus $7.4 billion for the unfunded unemployment insurance fund, $5 billion in lost lawsuits the State can not pay and the over $5 billion is lawsuits we are about to lose. Then you have at least $3 billion is asset sales that will not occur. For instance the Governor thought he could sell a portion of the State Compensation Fund for $1 billion–he gave up on that last week. The Insurance Commissioner, Steve Poizner, noted that if sold, it would skyrocket Workers Comp premiums in California and cost lots of jobs. USC would like to buy the LA Coliseum, but the State refuses to sell, when will Sacramento get serious?

This does not include the over $171 billion in debt, the over $200 billion in unfunded CalPers liabilities, $110 billion in unfunded health care liabilities, $24 billion in CalStrs unfunded liabilities and more. Dan Walters, the famed Sacramento Bee columnist recently noted that the total debt of California is approaching $600 billion.

That is the truth.

In February, the Governor and legislature raised the sales tax–since then the sales tax revenues have gone down by 14% statewide. Other taxes were raised and those revenues also decreased.

That is the truth.

The Governor just "loaned" $11 million to out of work truck driver to buy new filters for their trucks. Close to 1200 truck drivers, many Hispanic, were put out of work due to the rules promoted by AB 32 on this one issue, it is a job and revenue killer. These people would not be out of work, and the $11 million could be used for education, debt or deficit reduction, or a good, productive purpose, were it not for AB 32.

Some time in late January or early February we will probably have another Special Session of the legislature. The Governor is looking at more cuts in spending (his highest budget was $104 billion in the General Fund account, it is currently $86 billion), and taking more money from cities and counties, from the Redevelopment Funds. Thanks to the SEIU winning a lawsuit against the furloughs, thousands of SEIU members will lose their jobs–but the general public will not notice reduced services–have you been harmed by the DMV closing a couple of days a month?

This does not count the over $400 million taken from the recycling program for bottles and cans to cover the deficit. Those nickels and dimes can add up. But, without the money, dozens of recycling centers are closing in the Bay Area and the Association representing the recycling is suing–and will get the money back, with interest.

California is in trouble, we are in a Great Depression.

Want the truth?

California is in a Great Depression and will stay in this Depression until adults are put in charge of our Capitol and policies change.

How do we fix this mess?

1. End the union monopoly over government. The SEIU just won a case against the Governor for illegally furloughing tens of thousands of SEIU members, in violation of a contract. Now, he has no choice but to fire thousands of SEIU members. Does anybody actually feel the closing of the DMV has hurt them? What if government was cut by 20 or 30%, we could still carry on. End the union monopoly on contracts and save 10-15% on each agreement–the difference between union premium pay and the street value of the work to be done.

2. Cut taxes by 10%. Reaganomics work. Cut taxes, people have more money, they buy more and tax revenues go up.

3. The highest Schwarzenegger budget was $104 billion, from the General Fund. It is now $86 billion. We need to cut another 10% of State funding. This would mean we would not have to steal money from local government agencies, the recycling fund and dozens of other dedicated Trust Funds (we are being forced to pay back that illegally taken money anyway)

4. Enforce our immigration laws. The City of Lancaster in Los Angeles County is now mandating that private firms verify new hires are here legally or they lose their business license. This means honest people would get off the unemployment roles, the dishonest would not be able to work. California also has laws to impound the cars of those who are driving without a license. Strictly enforce this law as well.

5. Vote NO on all bonds. We have glutted the market, many approved bonds have not been sold. And, the cost of bonds is skyrocketing. Lets digest the mistakes we have already made before making new ones.

Take away the jobs and cars of illegal aliens and maybe they will decide on their own California is not for them. Arizona has lost illegal aliens in their population by enforcing laws, we could do the same.

The choice is simple. Reform government by cutting it, forcing it to be more efficient and responsible. Or, next year we can be writing stories about Year Two of the Great California Depression.

In ten months we will have an election. Will we finally elect adults? If not, we have only ourselves to blame for the California Great Depression. Can you handle the truth?

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