Tuesday, August 24, 2010

The Governor’s Hostage Crisis

While he holds the state budget hostage to meet his demands on the way out of office, our governor poses as the sole fiscally responsible adult in the Capitol. He speaks as if the Legislature is the only thing standing in the way of balancing our state budget and bringing us back to a sound economy.

Let’s take a serious look at what the governor says he wants to do and what would really happen if the Legislature stepped aside and let him do it.

The governor wants to “rein in state spending” with a spending cap, even though the voters soundly rejected his proposal twice during the past few years. In reality, a spending cap would destroy long-standing institutions like the University of California, California State Universities, community colleges, state parks, roads, bridges, highways, public safety, cities, counties and other vital services. The reason (which the governor never mentions) is that unless Proposition 98 is repealed, the voter mandated spending on K-12 becomes a budget PacMan, eating up virtually all revenues available under the cap. The voters rejected this proposal for good reasons.

The governor says he wants to control revenue swings. Sounds responsible. California is subject to wild swings in general fund revenues, depending on how well Wall Street is doing. Smoothing those out would enable us to better plan our budgets from year to year. But the governor’s proposal to adopt the Tax Commission’s recommendations has nothing to do with smoothing out revenues and everything to do with shifting the tax burden from wealthy individuals to poor and middle-class Californians, while benefiting out of state corporate employers.

The governor claims he wants to “reform” public employee pensions and this is so important that he won’t sign a budget until he gets his way. However, he fiddled during his 6 years in office while costs skyrocketed, hoping to force the Legislature into changing the law instead of bargaining within public employee unions. Indeed, this has little to do with saving the state money and everything to do with privatizing pensions and weakening public employee unions.

It’s the same old tired agenda which the voters rejected in the 2005 special election. But this time, the governor is holding the state hostage to do his will. He travels around the state talking to everyone BUT the Legislature all the while claiming he wants to make a deal with us.

Here’s the deal: Our state is on the verge of collapse. Just look at the economic devastation all around us. In some communities, the unemployment rate exceeds 30%. In some neighborhoods every other house has been foreclosed. Schools are shutting down, teachers are being laid off, classroom sizes are being increased, the school year is being shortened. Students can’t get into college and those that do get in can’t get the classes they need to graduate. Once they graduate, they can’t find a job. And the list goes on….

For the past several decades, the argument has been that if we cut taxes, jobs will be created and our economy will expand. Well, we’ve been cutting taxes for the past 30-some years and now we are seeing the truth. The state has been living off the previous generation’s investments, we have failed to plan for our own generation’s needs and the needs of the next generation. We have no reserve to fall back on during tough times. People who continue to believe this canard are deluded. People who continue to repeat it are manipulating or engaging in magical thinking.

The destruction now happening is not random. It is happening as a result of very real decisions being made by real people, both at the federal and state level. I, for one, refuse to enable this economic devastation any longer.