My Economic Policy - California needs someone to terminate taxes.

WSJ ^ | September 24, 2003 | BY ARNOLD SCHWARZENEGGER

[So Cal Rocket]

I have often said that the two people who have most profoundly impacted my thinking on economics are Milton Friedman and Adam Smith. At Christmas I sometimes annoy some of my more liberal Hollywood friends by sending them a gift of Mr. Friedman's classic economic primer, "Free to Choose." What I learned from Messrs. Friedman and Smith is a lesson that every political leader should never forget: that when the heavy fist of government becomes too overbearing and intrusive, it stifles the unlimited wealth creation process of a free people operating under a free enterprise system.

[So Cal Rocket]

Have at it.

[narby]

Sounds like a real lefty to me (/sarcasm)

[zencat]

Anyone who cities Milton Friedman and Adam Smith as having the most impact on their economic thinking has got my vote.

[Stirner]

My only questions: if Davis is the second worst governor, who is the champ?; if California has the second worst climate for business, who has the worst?

[moodyskeptic]

Thanks for posting. I just read this in WSJ.

I've been telling people that Ah-nold is not the fool he sounds like. His diction makes him sound stupid. But I've followed his career and he is no dummy. His only business failure, Planet Hollywood, was beyond his control because too many cooks in the kitchen.

Would he be a good governor for me? Don't know, but I'm willing to gamble on him. I enjoy the thrill.

Busty is same/same with Davis. Ho hum.

Wish all you freepers could join in the CA excitement. You know you're jealous.

[trebb]

Even though Arnie professes to be a Social Liberal, it seems he is smart enough to know that if you kill the cow, there is no more milk,,,

[Weimdog]

RINO, RINO, RINO!

HE'S GONNA TAKE ALL OF OUR GUNS AWAY AND MURDER BABIES WITH THEM!

;~)

[daviddennis]

I don't think he had any managerial input whatsoever into Planet Hollywood.

The idea was that he would loan out his name to the place, and the publicity would be a substitute for ads.

It worked - many people have eaten at Planet Hollywood. The problem is that management forgot that the food had to be good for people to want to return.

Arnold has operated his own successful restaurant, and judging by its web page he would never make that kind of mistake himself. (He has since sold it to the management that was already in place).

Articles I have read about Planet Hollywood have entirely vindicated Arnold as having no input whatsoever into the problems that caused it to fail.

Hope that helps.

D

[daviddennis]

A this-is-pretty-darn-impressive ping :-).

Enjoy!

D

[headsonpikes]

If Arnold's a RINO, then the Pubbies need more RINOs! lol!

[kingu]

It is a shame that the debate tonight is going to be so important to so many people. If the people on Free Republic held simply oral debates, we'd probably come to fistacuffs rather than working together to change things for the better (or to keep liberals from changing what works.)

If it came down to written debate, there's no question that Arnold and his team would clean the streets against anyone. Then again, while I'm dreaming, I can hope that Bill Clinton and his husband would drop out of politics and start a new career in prison. Maybe even entering the prestigeous profession of jail house lawyer.

[Rabid Dog]

Thank you sir! I'll be gone much of the day but thought I would contribute a couple of columns by Tom. Perhaps the arguments can be on issues not personal appearances.


http://republican.sen.ca.gov/web/mcclintock/article_detail.asp?PID=212
Reforming State Spending (Column)

Senator Tom McClintock
Date: February 12, 2002
Publication Type: Column Print Version

The enormity of California’s budget problems can be measured by simple numbers that speak for themselves:
State government now spends a larger portion of personal income than at any time in its history.
General fund spending grew 36 percent in the last three years, while California’s population grew 5 percent.
California now spends nearly $3,000 for every man, woman and child in the state, compared to $1,800 in Arizona.
The state is now spending over $1 million an hour more than it is taking in.
Instead of fundamentally changing the way California wastes money, legislators have proposed tripling the car tax, increasing the state sales tax by 16 percent, and boosting the upper income tax brackets to historic highs. Meanwhile, the governor proposes to borrow billions of dollars from future taxpayers to pay for this generation’s profligacy.
California’s budget woes are not the fault of the taxpayers for not paying enough taxes. They are the fault of years of gross mismanagement of state government.

So where to begin the reforms? Here are a few modest suggestions that would balance California’s budget, improve the delivery of services and produce significant savings to one of the most heavily taxed people in America:

Restore Competition: California’s constitution places severe restrictions on the ability of state government to shop around for the best service at the lowest price. Allowing the state to bypass its expensive bureaucracy when the private sector can do better could by itself save the state a fortune.

End Corporate Welfare: Public funds should not be used for the benefit of private interests, and yet state government spends hundreds of millions of dollars annually to support the state’s wealthiest corporations. The promotion of trade and commerce is the responsibility of the businesses doing the trading – not the taxpayers.

Conform State Welfare Benefits to Federal Standards: The federal government sets strict limits on the amount of time a person may collect welfare and expects that recipients actively look for work. California largely obviates the federal requirements – at the state’s expense. Simply conforming to federal welfare standards would save $1 billion annually.

Performance-Based Budgeting: When units of output can be measured, it makes sense to pay based on performance. Lines would move much faster at the DMV if employees were paid on the number of applications they processed.

Consumer-level Budgeting: The average California public school student is backed by more than $9,200 from local, state and federal funds, but only a fraction actually reaches the students. If budgeting began at the classroom and every level of bureaucracy had to justify and publish the amount it extracted to support itself, the pressure to minimize non-essential spending would be enormous.

Zero-Based Budgeting: Current baseline budgeting begins with last year’s budget and adds to it. Long proposed by budget-reformers, zero-based budgeting rolls all budgets back to zero each year and requires every program to be justified anew.

Restore the Gann Spending Limit: The Gann Spending Limit restrained budget growth to a combination of inflation and population, but was rendered utterly ineffective in 1990. If state spending had increased in line with the original Gann limit over the past three years, the budget would still have grown 13%, but instead of a $12 billion deficit, California would be enjoying a $28 billion surplus.

Stop Robbing Piedmont to Pay Pasadena: California’s budget has become a grab-bag for local pork projects that exclusively benefit one community at the expense of another. State funds should be reserved for projects that benefit the state as a whole. Local communities should pay for local projects.

Enact a Bureaucracy Realignment and Closure Commission: This device was extremely effective in breaking down the parochial resistance to closing obsolete military bases, and could put before the legislature an annual list of obsolete state bureaucracies for closure or consolidation.

The next time a politician tells you that there is no room to cut California’s bloated bureaucracies, ask why it is that the state spends so much and delivers so little. Chances are, you’ll be looking at the reason.


# # #
Senator McClintock represents the 19th State Senate District in the California Legislature. The Senator’s e-mail address is tom.mcclintock@sen.ca.gov. The Senator’s website address is www.sen.ca.gov/mcclintock.

[Rabid Dog]

And since Arnold mention house-hold budgets - here's another:

Senator Tom McClintock
Date: May 29, 2003
Publication Type: Column Print Version

Hi Honey --
Since you’ve let me take over our household finances, I’m happy to report that our family budget is balanced, I’ve saved thousands of dollars, and I’ve kept us in the style to which I would like to become accustomed.

You might wonder how I’ve been able to do all this. I just followed the easy steps that Gov. Gray Davis outlined in his May Budget Revision.

I know you’re upset because I spent nearly $11,000 more than we took in this year. You really need to keep things in perspective. Gray spent nearly $11 billion more than he took in, and he’s not worried. I’ve taken out a second on our house and Gray’s taken out the largest state loan in American history to cover the difference, so just relax.

I’m being fiscally conservative and socially liberal with our budget, just like the Governor. I’ve cut thousands of dollars from our expenses without affecting our standard of living in the slightest. I know you’re skeptical, but it was really very easy. I just added a new jet ski to my wish list and then scratched it out. That saves $5,500. Pretty clever, huh? You can actually do this in any amount – Gray “cut” $5.5 billion from the state budget exactly the same way.

I also saved us $2,100 by not making our December mortgage payment until January, giving us a little extra cash this year. Once again, I can’t claim credit – it was Gray’s idea. He took $1.2 billion that the state owes to the schools and pushed it one month into the next fiscal year. Then he did essentially the same thing with $930 million in MediCal spending. Presto: another $2.1 billion that he “cut” from the budget.

The biggest financial problem our family faces is that the state is about to triple our car tax. I know you’ll feel better knowing that Gray is claiming this $4.2 billion tax increase is really – you guessed it – a “cut” in government spending. Overall, taxes will rise an average of $950 per family.

But it’s no problem -- we can pay our steadily increasing taxes the same way Gray is paying for his steadily increasing pension obligations. The state owes its main pension system $1.9 billion this year. Instead of paying it, Gray simply took out another credit card. We can make our taxes go away the same way.

Now I need to mention a sore subject – the kid’s college funds. I know they’ve been saving their baby-sitting and lawn mowing money, but these are hard times and everybody needs to sacrifice. So I’m taking $940 from them to balance our checkbook, and I’ll promise to pay it back by 2009.

Before you get mad, just remember that Gray is doing the same thing with $940 million of the taxes that we’ve been paying at the gas pump that are supposed to be going into a special fund for our roads. The way I see it, if we’ve got to watch our highway taxes taken away from our highways, our kids can just suck it up too.

So don’t worry about a thing – I’ve learned a lot about money management from Gray Davis and have everything under control. I imagine that the bill collectors who keep calling may have some questions. Just refer them to the Governor’s Department of Finance. I’m sure there’s a former Enron accountant there who can explain everything.

Meanwhile, I’m going to go ahead and buy that little boat I’ve had my eye on. Gray added $2.2 billion to his spending plan since January and after everything I’ve already saved, I figure I’m entitled.

Thanks for the checkbook, Honey.

[pgyanke]

I appreciate your presenting both sides of the Republican ticket.

One question for both sides of supporters: Where do either of them stand on illegal immigration? That is arguably one of the single greatest problems (social and fiscal) in CA and the rest of the US.

[Rabid Dog]

Tom is very adament about supporting the laws currently on the books for illegal immigration. He did not support the car license decision.

I can't speak for Arnold.

[DoctorZIn]

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[habs4ever]

RINO supply side Reaganite posse ping!

[Rabid Dog]

I know you have a great deal of sourced information at your claw-tips. Can you answer the above question?

[Rabid Dog]

You may need to rethink participating - the trash posse has been pinged.

[So Cal Rocket]

My only questions: if Davis is the second worst governor, who is the champ?; if California has the second worst climate for business, who has the worst?

From the CATO Institute: "F grades were assigned to the four most fiscally reckless governors: Don Sundquist of Tennessee, Gray Davis of California, Bob Taft of Ohio, and John Kitzhaber of Oregon."

From the Small Business Survival Committee 2002 Survey (I couldn't find the 2003 survey): California was 46th, ahead of only New Mexico, Minnestoa, Maine, and Hawaii (and Wash DC).