Biggest Threat on November Ballot
An
initiative sponsored by government
worker unions has qualified for the November ballot – and it may well
be the most threatening issue facing businesses and taxpayers in 2010.
So
what does it do? According
to sponsors, Proposition 25, the "On Time Budget Act," merely
reduces the legislative vote requirement to pass the state budget from
two-thirds to a simple majority, and stops paying legislators if the budget is
late.
But
when you think about it, why would the California Federation of Teachers,
California Faculty Association, California School Employees Association,
California Professional Firefighters, Professional Engineers in California
Government, American Federation of State, County and Municipal Employees, and
California Nurses Association invest millions of dollars in a measure simply to
reduce the vote on the state budget? What else does it do that its sponsors are
not talking about?
Glass Houses
Recently the Wall Street Journal reported that CalPERS, the country’s largest public pension fund, is recruiting executives for seats on poorly performing corporate boards.
Apparently, CalPERS places blame for much of the financial crisis on lax cultures inside corporate boards and a failure to hold directors accountable. As a CalPERS spokesperson put it: "If boards live in a world of no consequences and can let a company go to wrack and ruin, what are we to do?"
CalPERS is right to pursue better governance. Boards sometimes do allow practices that can lead to failure of enterprises and disaster for our economy. As starkly illustrated in the financial crisis, one glaring example took the form of misleading financial reporting.
John Laird’s Spin Cycle
Former Assemblyman John Laird has been spinning away from his track record on taxes and spending just as he tried to spin his second place finish to Assemblyman Sam Blakeslee in the 15th Senate District primary as a win.
You’ll recall that Blakeslee just missed avoiding a run-off on June 22nd by a half-percentage point. But, Laird wrote that Blakeslee’s near miss was actually a big boost for the Laird campaign when you considered all kinds of factors and assumptions. In a word — spin.
Laird is at it again when reviewing his tax and spend record.
Antiquated Computers Managing State Payroll? There’s an App for That
Reading the headlines on Rough & Tumble this week has sparked a bit of déjà vu on my part. Just as in 2008, the governor has ordered that pay for most state workers be reduced to the federal minimum wage during the budget impasse. And just as in 2008, the controller is refusing to comply – once again claiming that the computer system used by his office isn’t capable of processing the request.
Apparently he ignored my advice about buying himself a Mac back in ‘08.
I still stand by my recommendation, but I can understand why the controller decided not to head in that direction. The state is in a fiscal crisis, after all, and Mac’s aren’t exactly cheap.
The Storyline of This Recession in California
The storyline of this recession in California has yet to find its place in California literature. It will over the next decade; and it will be a storyline very different than those of the previous economic downturns over the past 70 years.
Our thinking about California recessions and depressions has been greatly influenced by novels and movies. When we think of the Depression we think of the Joads, uprooted from their land by economic forces beyond their control, driven from Oklahoma to California to be part of a reserve army of other uprooted farmers.
The Grapes of Wrath, first as a novel published in 1939 and later as a 1940 movie directed by John Ford fixed the Depression as due to the uncontrolled workings of the market economy, and helped cement the Keynesian consensus that has governed California and the nation for most time since.