CA: State policies work against good fiscal management

LA Times ^ | 5/23/09 | Evan Halper

[NormsRevenge]

Reporting from Sacramento -- In this economy, every state is hurting. Unemployment is in double digits, tax receipts are taking a dive and deficits are piling up. But, once again, California seems to be in a class of its own when it comes to financial dysfunction. The problems here eclipse those elsewhere.

California has the distinction of being the only state that is constantly running out of cash. California is the only one pleading with the federal government to backstop an emergency borrowing plan. California is the only state that never completely closed its deficit from the last economic downturn ..

The state has become a laboratory for what not to do when it comes to managing finances. The online news journal Stateline.org, which state government wonks look to for news on the latest policy trends, recently published a guide of sorts for bureaucrats and analysts who want to keep their state from becoming another California. Rest assured, the piece advised, most states are not likely to find themselves as troubled as the Golden State any time soon.

Size is a factor. "You are talking about the eighth-largest economy in the world, so the numbers involved are just so monumental," said Sujit CanagaRetna, a senior fiscal analyst with the Council of State Governments in Atlanta. "The largeness of the problem makes it more intense."

But there is also so much more.

The oft-cited waste and abuse is a problem, but the deficit is bigger than the entire state bureaucracy.

California could fire every state employee -- including those well-paid prison guards and university professors -- close every government office, stop all travel and even cease the purchase of paper clips without closing the budget gap. The government would be gone but the deficit wouldn't.

[NormsRevenge]

Looks like if someone were gonna build a fiscal Doomsday machine, they need only look to California.

[paul51]

There is no simple way to seriously limit these healthcare costs short of eliminating the benefits for hundreds of thousands of Californians.

Well, I think you have the solution right there

The alternative to spending the money is releasing tens of thousands of inmates and parolees.

Load them up on buses and drive them to the border

[Hugin]

‘Bread and Circuses’ is the cancer of democracy, the fatal disease for which there is no cure. Democracy often works beautifully at first. But once a state extends the franchise to every warm body, be he producer or parasite, that day marks the beginning of the end of the state. For when the Plebs discover that they can vote themselves bread and circuses without limit and that the productive members of the body politic cannot stop them, they will do so, until the state bleeds to death, or in its weakened condition the state succumbs to an invader - the barbarians enter Rome.... Mine was a lovely world till the parasites took over.

——Robert Heinlein

[calcowgirl]

Among the likely recommendations:
Updating the tax structure ...
Ending the two-thirds rule ...
Reigning in citizen initiatives ...
Building a serious rainy day fund ...
Getting some real oversight ...

Hmmm... I don't see spending cuts on the list. Surely, just an oversight. /s

[abigkahuna]

The time is ripe to divide California into several smaller states. The problems of the welfare county of LA would be their own to deal with...

[I am Richard Brandon]

Every government “benefit” should be reflected immediately in direct taxation increases to cover its cost. That direct taxation should be paid by every member of society. The “Poll Tax” that accomplishes this is the very same tax that destroyed Maggie Thatcher. Why? Because the voting, but formerly untaxed proles, suddenly felt the cost of their feeding at the public trough. So what did they do? They simply voted Maggie out and Socialism (The British Labour Party) back in. The lesson to be learned is NOT that the Poll Tax is bad. The lessons are that the Poll Tax is very effective and direct democracy has flaws.

[marsh2]

California provides a welfare benefit for children after parents have maxed out their benefits or have failed to preform welfare to work requirements. Oregon has no such benefit. We are in a border county with Oregon. Our family resource centers see a steady stream of potential welfare folks coming down the I-5 corridor attracted by California’s benefits.

The public has got to accept that we will always have the poor. The progressive utopian dream of everyone with a house, a full belly, health care, a car and a big screen tv has been an unrealistic one throughout history. As a child of the 50s and 60s, we were always taught that civilization happens when the majority of the population supports a class with time to create, learn, research, etc. If we divide the wealth equally, we are all poor. Life isn’t fair. Get over it.

In the past, much of the support for the poor, elderly, disabled has been a strong family, community institutions, churches and charities. We need to foster and encourage the re-growth of these non-governmental institutions rather than the growth of government.

Through the free enterprise system, we have been able to create those advances that have improved everyone’s standard of living - medical improvements, higher crop yields, better communication, etc. We should chronicle that before we go chucking it out in exchange for the empty promises of Marxism.

[SaraJohnson]

or the Federal government... Yikes!

[goldstategop]

They look for ways to maintain and increase spending, which is the root of the crisis. Never once do the brightest minds in California consider the obvious: the state is spending way too much money and no amount of increased revenue can possibly pay for all that spending. Its just not possible. Until California's elites come to terms with the fact the state cannot do everything well, it will continue to suffer from living beyond its means.

"Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached." - Manuel II Palelologus

[itsahoot]

In the past, much of the support for the poor, elderly, disabled has been a strong family, community institutions, churches and charities.

All of that has been destroyed by the state, unfortunately when the state takes these responsibilities away from the individual they cheapen the church and its members.