Archive for December, 2009

I love California.  I was raised in Oakland, so I may be biased.  I truly believe there is no other place on earth that offers so much of everything.  You can experience the ocean to the mountains and all things in between in a 3 hr drive from whereever you are.  It is the most populous state with nearly 35 million people (12% of total US population), so I’m not alone in this sentiment.

But California is broken.  My beloved is more gold-plated than golden these days.  It has one of the highest unemployment rates, incarceration rates, and a host of other social ills.  It can not pay its bills.  I’m afraid it is true that California will slide into the ocean one day.  In fact it is here: an ocean of debt, sloth, and bloatedness.

How?  Why?  Ideological purity and special interest.  Few realize that California is the home of the current wave of cut all taxes in all economic times, regardless of the long-term effect syndrome.  It is also the home of increased unionization and fraud and greed.

30 years ago, California had the best education system in the world K-Post Grad.  18% of the state budget was spent on schools.  Today, this number is 10%.  Why?  Because of Prop 13 that allowed property taxes to be marked to book value and not actual value.  Tax revenues fell 57% and the rest is history. (For those that don’t know, property taxes is the primary source of school funds.  This is why high property value areas tend to have decent public schools).  This trend to cut taxes continued across the broad.

On the other side, we have the unions. Teachers, state workers, auto, you name it, asking for bigger shares of everything.  Not that it was all bad, but they were not willing to bring anything to the table.  You can’t talk about firing the teacher not teaching, or laying off the telecom worker that is on payroll, but the company doesn’t have work for him.  So spending increases.

When you toss on a heap of ideological purity, you get gridlock. Dems will not cut anything and Repubs will not raise the required taxes to get the situation solved.  We are quickly getting there as a country.

No this is not about healthcare, which is needed for competitive economic reasons, but rather our mix of spending that does not invest in our future. We don’t need bigger armies and departments of defense. We aren’t getting a good return on them anyway.  We need investment in our core: roads, schools, training, communications, and energy.

What we are getting are purity tests.  Jim DeMint, senator from S.C., said he would rather have a small caucus ologically pure Republicans than a mix of conservatives and moderates that actually have the power to move, shape and write legislation.  The only power they would hold is the power to kill debate.  He doesn’t want to work with anyone to get things done, only make sure no one else can get things done.  Why is he there?

What we need are people like Bush Sr. and Clinton.  People to do the right thing when it is unpopular and even against their party.  Bush raised taxes when we needed it keep the lights on in the house.  It wasn’t fun for him, but he did it out of principle.  Clinton cut welfare rolls and trimmed back spending in the military and other places.  Did I mention that in both cases they had to reach across the aisle to gain support for these measures?  And by most accounts, these actions spurred the economy forward leaving surpluses by the end of the 90’s.

I love California, but I don’t want the U.S. to become California.