Pension Bomb Explodes at Jerry Brown’s Feet
Yesterday, a study issued by Stanford University’s Institute for Economic Policy Research declared that California faces a state pension liability of a half-a-trillion dollars. The study’s title, “Going for Broke,” tells you all you need to know about the dire situation the state faces with unfunded pension obligations.
David Crane, the governor’s special advisor on jobs and the economy spelled out the pressure the pension problem will put on general fund spending in today’s Los Angeles Times. Crane argues the lack of reform on pensions rests with a legislature that is controlled by public employee unions. As Crane puts it, paraphrasing Abraham Lincoln, “Instead of a government of the people, by the people and for the people, we have become a government of its employees, by its employees and for its employees.”
Crane traces the political takeover by the unions to the Dill Act signed by Governor Jerry Brown in 1978 giving the public unions collective bargaining. As the unions power over the legislature has grown the concern is reform on the pension front will be more and more difficult to accomplish.
Beginning to Solve California’s Budget Crisis
We all know California is over its head in budget troubles. The budget deficit is at least a $20 billion, state debt levels are unsustainable, we have racked up overwhelming pension obligations, and no agreement on how to tackle these problems. There is no silver bullet solution-a great many things are going to have to change in California to solve these problems.
Let me suggest two things to start.
First, “Reinventing Government” author and Clinton administration management expert David Osborne provides part of the solution in a new Reason study on how California can build a better budget. The Next California Budget urges the governor and legislature to start from scratch. Rank education versus transportation versus state prisons and evaluate specific programs within these areas. Not everything can be funded, so what are the state’s specific goals and top priorities? What are citizens demanding and what are they willing to live without? Do taxpayers want to reduce spending or raise taxes to achieve the goals they set?
Why I Am Supporting Carly Fiorina
Our nation is struggling with the worst economy of our lifetime. Across the state, some 2.3 million Californians are out of work, and Fresno County’s unemployment rate was a staggering 18.2 percent in January.
Given these difficult times, it’s critically important that our representatives in Washington fight for our state by championing fiscally responsible legislation that promotes economic growth, creates jobs and pays down our debt.
Carly Fiorina is a true fiscal conservative who understands that Californians are very concerned about the state of our economy. She has the real-world experience and grit to stand up and fight for us. I know Carly will be a staunch advocate for the people of California in Washington, and that’s why I am so pleased to endorse her candidacy for U.S. Senate.
California’s Families Can’t Afford Nava’s Oil Tax Scheme
In a recent article that appeared in the Santa Barbara Independent, Nick Welch, the paper’s executive editor, let the cat out of the bag as it relates to Pedro Nava’s true motive for pushing AB1604, which if passed would impose a 10% severance tax on California domestic oil production. In the article, Nick points out that Nava’s reason for pushing this new tax legislation is to gain favor with environmentalists who he hopes will help him in his race for Attorney General.
In other words, the Nava oil tax scheme isn’t about good fiscal policy, sound economic policy, or even smart environmental policy…it is about politics and Pedro’s personal ambition. And that is of course bad enough. But it’s even worse when you consider the impacts on our state’s families if Nava’s oil tax scheme were to become law.
Indeed, if passed, Nava’s oil tax scheme would be imposed on all of California’s oil and gas operators’ gross oil production. Nava and his bill’s proponents claim this is justified in light of the fact that Texas and Alaska impose a similar tax. They suggest, therefore, that California is giving oil companies that do business in this state a "free ride".