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Jerry Brown is Dreaming of a Blue Christmas (Forbes.com) December 20, 2017

Posted by daviddavenport in Op/Eds.

While traditionalists dream of a white, snowy Christmas, California governor Jerry Brown dreams of a blue one:  a blue state, with a blue governor, aggressively pursuing blue-state policies.   While much has been made of Governor Sam Brownback’s failing effort to turn Kansas into a model red state, Jerry Brown seems to be riding high.

There he is on CBS’s iconic “60 Minutes” program, explaining how California’s wildfires are the curse of climate change and Trump’s failure to acknowledge climate science and act on it.  Meanwhile he’s whisking off to yet another Paris climate conference, preaching that the world is “on the road to hell.”  The federal government’s tax cuts are a “monstrosity” according to Brown’s gospel of blue governance.

But in Jerry Brown’s blue California, all is not calm, all is not bright this Christmas.  For example, even though California spends far more on welfare than any other state—in fact, at $103 billion a year, more than #2 New York and #3 Texas combined—it has the highest poverty rate of any state.  In fact, there may be some cause and effect here, since California attracts more illegal immigrants than any other state at a high cost, estimated at over $20 billion.  Besides generous welfare programs, blue California now provides driver’s licenses and financial aid at the University of California to undocumented immigrants.

An article of faith in blue states is high tax rates to fund services and address income inequality and, once again, California leads the way with the highest state income tax rate in the nation (13.3%).  But wait, there’s more.   The top 1% of income earners in California pay 50% of all state income taxes.  And much of the state’s tax base is funded by the highly volatile profits of Silicon Valley.  This is hardly a formula for long-term balance or fairness.

With high taxes, a burdensome regulatory environment, and its astronomical cost of housing, businesses and workers continue to leave California for other states, especially Texas.  A demographic report by Joel Kotkin and Wendell Cox shows that more people are leaving California than entering, and especially those in the middle class who work in major business centers such as Los Angeles and San Francisco.  More trouble in blue nirvana.

These underlying fiscal trends have created dangers for the state’s finances in ways that are rarely disclosed.  While Governor Brown touts a “California comeback,” the state is already facing a budget deficit after a few years of balanced budgets.  Beyond the operating budget, other financial alarms are sounding.  More and more money is spent in “special budgets” that have grown dramatically in recent decades.  Pensions for state and local government workers are woefully underfunded, creating an unfunded liability of at least $280 billion, with one estimate as high as $1 trillion.   California’s highways and other infrastructure are decaying with little or no money for improvement (but apparently enough money for Brown’s blue state dream of high speed rail).  Parts of the once golden state look like a third world nation.

California has run off the rails in part because it has become a one-party state with the only real policy debates between the Governor, who wants to spend more, and the legislature that wants to spend more still.  The legislature has been under Democratic control since 1970 (with the exception of 1995-96 in the Assembly), in recent years with a super-majority.  The color wheel in Sacramento runs from blue to bluer.

But in the end, do people really want their leaders creating either ruby red (Kansas) or true blue (California) models of governance?  I think not.  Most people just want their government to work, and essential services to be provided at a reasonable cost.  Both Kansas and California are failing that essential test.

To view the column at Forbes.com:


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