Skip to comments.The State Worker: Be careful what you wish for
Posted on 11/04/2010 8:21:03 AM PDT by SmithL
Some things to ponder now that Jerry Brown is governor-elect:
On Monday, Local 1000 of Service Employees International Union will start counting ratification ballots for a new contract for 95,000 state workers.
The deal, already ratified by the Legislature, is laced with concessions in pay, benefits and pensions that are sweetened with a few protections and deferred raises. Depending on who's talking, it's the best bad deal the union could cut or complete capitulation to Gov. Arnold Schwarzenegger.
Some union members held their ballots to see whether Democrat Brown or self-funded GOP candidate and self-professed state jobs chopper Meg Whitman would win on Tuesday.
Since Brown won, the holdouts are voting "no" on the deal negotiated with Schwarzenegger and hoping for a bargaining do-over with a more friendly Brown administration. Had Whitman won, they would have voted for the deal.
..."Gov. Brown is stuck with the same problems that Gov. Schwarzenegger had, especially balancing the budget,"
...So will he try to lift furloughs for the 63,000 state worker still on furloughs
..."He'd have to find other savings to do it,"
(Excerpt) Read more at sacbee.com ...
I smell recall.
States are broke, local governments are even more broke. Many have enormous unfunded pension liabilities and out of control contracts with workers (SEIU and teachers being good examples). There is simply insufficient money to make it work.
By forcing asset prices higher (stocks), The Fed hopes to prevent the wholesale meltdown of the pension system. better to pay off in devalued dollars than not at all.
It is all a ponzi, kick the can down the road. At some point it will all come crashing down. However it ends we will all be poorer ...
Yeah I have every confidence Moonbeam can pull that off.
Wait.. I know!!!
Kick out some more businesses, give free college to illegals and raise taxes!! That’ll fix it!
CA and Nevada for that matter aren’t going to make it to 2012 in any recognizable form.
Wish I could care, but I can’t.
Any conservatives in CA, move while you still can. TX, FL, or even OH and PA are going to be OK after Tuesday.
To the libs in CA and NV: You’ve made your beds. It’s time to lay in the filth you’ve created. Scumbags.
There. Fixed it.
“By forcing asset prices higher (stocks), The Fed hopes to prevent the wholesale meltdown of the pension system. better to pay off in devalued dollars than not at all.”
I agree. The extremely low interest rates on treasuries has propelled an asset bubble. The bubble is not just in stocks. Bond prices have soared although they have retracted a little in the last month or so.
Individuals living on retirement savings are in a difficult place. Rates on traditional safe investments are insulting. The asset bubble is frightening.
So the union thugs in California and Nevada believe that "tax and spend" Democrats will continue to bring in the bacon. I guess that the union folks and Democrats both have little understanding of basic Economics 101, supply and demand.
I suppose that the Dems can get money by raising taxes, from other states, the Federal government, and other countries to bail them out over and over again. Good luck to them and all those with disordered minds!
When Prop 13 is jettisoned, liberal property owners can KMA.
I don’t want to hear your whining!
It certainly has me concerned. With all the sharpies pushing gold, I can see no real safety there. In fact, I do not trust any of the “money” guys at the moment. I am sorely tempted to invest in real estate if the prices are about 1.5 times their 1995 level, i.e., a 3% p.a. increase since the last real estate asset bubble.
“To accomplish that balancing act, Brown will have to convince state workers that he can tell them “no” and still be their champ.”
LOL! Jerry is OWNED by the state employee unions he created.
Exactly. So we are in effect transferring wealth from the retirees by paying them a pittance on their savings and further devaluing their assets thru inflation to the speculators who borrow at extremely low Fed fund rates and invest in stocks and bonds.
And who is structured to leverage up and buy stocks on margin? The money center financial institutions of course.
Bernanke is a mad man, he continues to lead us on a path to ruin. They are soooo fearful of deflation that they act irrationally. My favorite quote from Von Mises:
There is no means of avoiding a final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion or later as a final and total catastrophe of the currency system involved.
An independent banker with no accountability to anyone really (especially so since Bam is no where to be found) is making decisions for us all. It is total insanity.
As someone who has never lived in CA (and only visited occasionally years ago), I am not familiar with Prop 13. Can you explain it, please?
I knew that I’d missed a few...
The most significant portion of the act is the first paragraph, which capped the tax rate for real estate:
Section 1. (a) The maximum amount of any ad valorem tax on real property shall not exceed one percent (1%) of the full cash value of such property. The one percent (1%) tax to be collected by the counties and apportioned according to law to the districts within the counties.
Thanks! Why would he repeal it this time and not repeal it the last time he was in office?
There was an excellent discussion about this issue a month or so ago by Freepers.
Proposition 13 is a major factor driving the escalating price of California real estate.
This is an unintended consequence.
It works like this:
If you hold your property you keep the benefits of low property taxes. If you sell it and move somewhere else your new property is reassessed and you are clobbered.
As a result there is a huge economic incentive for Californians who want to move within the state to stay where they are and keep their home off the market.
Therefore as long as there is any significant net in-migration of potential homebuyers (or renters who move to buying—i.e. younger Californians) then the demand for housing will greatly exceed the supply. The result is wildly escalating housing prices.
There are other factors as well (environmentalist regulations preventing and related zoning restrictions preventing new units) but this is a major impact.
So, if proposition 13 is repealed the impact on California property values will be devastating. Combine that with the current unemployment situation and we could be talking major real estate meltdown here.
This is high stakes politics. I wonder if all the players understand the consequences.
21 posted on Saturday, February 01, 2003 4:27:21 PM by cgbg
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He fought hard until it passed. IIRC, he tried to take credit for it then.
Thanks for the info. It makes things a little more clear for those of us outside looking in.
Here’s a FR discussion regarding Prop 13.
I don’t own property, but I know some elderly folk who own gobs of it who are already taxed to their teeth and dread the possibilities of a Prop 13 repeal.
Another significant part is that your property can never go through revaluation as long as you own it (once it changes hands, they can reval for the new owner).
So if you have owned your property since 1978, you are paying 1975 valuations (Prop 13 rolled vals back to that year), with a cap of the 1% per year.
My state has mandated revals every 5 years.
Ah, I see you covered that in this post.
Yet another person begging Californians to leave?
Given the fact your own Federal Government put you 14 *trillion* in debt, for the next 25 generations, all this complaining and hand wringing over California seems slightly suspect.
It's like worrying about the neighbors burned toast, when their entire home is on fire.
What’s weird about wanting more conservatives to move to the Republic of Texas, both for their good and ours?
Calling that weird is, well, weird.
BTW, by “ours,” I meant me and my fellow Texans’. Or the people of any conservative state for that matter.
I am not familiar with Prop 13.
I see some already forwarded details of prop 13. Prop 13 saved thousands of Californians their homes. People were being taxed out of their homes before prop 13. I knew several elderly folks who really had a hard time deciding on paying property taxes or household & other necessary expenses. They couldn’t afford both. The legislature felt they had unlimited funds and raised taxes at will and then prop 13 revolution came. Thank God for it. Politicians have been trying to sneak a way to kill prop 13 for years.
Jerry Brown screamed and yelled like the rest of them forecasting gloom and doom on the state due to limiting their ability to raise property taxes at will.
Fed pumping helps to artificially reduces interest rates in the short run, but that depresses rates which existing savers get on their small savings accounts. Those would be: retirees and elderly people with savings in banks. Fed money expansion is a wealth transfer - not a policy that “helps Society overall.” It is an inflation tax in the long run, and an act of theft from current savers in the immediate run.
BUTT OUT, GOVT
Stop with that bull s*t.
Begging people to move from CA is just freaking weird...You have absolutely no concern about CA, and your motives are at best, very suspect.
A little slip of the tongue eh?
Prop 13 limits the property tax on your house or business.
When you buy a house, your intial tax rate is limited to 1% of the property’s selling price. Annual increases are limited to 2% per year.
A house selling for $200,000 today, has an intitial property tax rate of $2,000 per year. The highest it can be raised the next year is from $2,000 to $2,040. Year 3 to $2,080. On and on.
Before Prop 13, there was no limit on how much the government could raise your property tax each year, and some people were paying up to 3% of their house’s value annually in property taxes.
Prop 13 was passed, for example, so retirees with paid for homes wouldn’t be repossessed on just because they could not afford to pay an exorbitant annual property tax. It stabilized taxes.
Opponents of Prop 13 would have you believe that they are losing massive revenue because of this and will cite people who have been in their homes for decades and are paying a tiny fraction of their homes value in taxes. True, but not that common. The fact is, most homes in California have turned over in the past 10 years and most people are paying more than 1% of their homes value in property tax. Opponents who claim otherwise are lying.
Care about CA? I couldn’t care less. I escaped the cess pool that is called LA 10 years ago. The place is a pit. Best thing I ever did.
Re your next post, I made no slip of the tongue. That was my whole point the entire time. I want more conservatives here in TX. Libs? Stay there. Please.
Other posters, for example the one upthread from VA, feel the same way. If it hurts CA, who cares? CA is dead, it just doesn’t know it yet. The election of Brown is just another nail in their increasingly suicidal economy’s coffin. Frankly, at this point, they’re going to have to hit rock bottom before a recovery can start. That won’t take long at this rate.
I do feel for conservatives stuck in that leftist pit, so I am happy to invite (not beg) them to come to a better place. One I know from experience is FAR better for conservatives, especially motivated ones. BTW, our state government does the same w/r/t business, and it’s working.
Don’t know what your malfunction is. These aren’t tough - or particularly unusual - sentiments for conservatives, esp ones who have already escaped. Regardless, I’m done talking to you about it.
Sorry, I let my despite for CA carry me too far with this line (too personal):
“Don’t know what your malfunction is.”
Please delete that line or post as you see fit, AM.
Apologies to dragnet2, also.
PS Please also pass my invite to Mr. Robinson to move to Texas. /couldn’t help myself