The title is essentially what is going on in California as the Democratic controlled state imposes a tax for the “prevention” of global warming.
Californians will now have to pay yet another tax as part of the state’s effort to fight global warming. Residents will now pay a global warming tax for buying gasoline on top of the already existing state gas tax.
But being “smart” politicians, they don’t call it a tax:
The global warming tax on gas retailers is part of the state’s cap-and-trade program. But state officials are not calling the global warming charge a tax, instead they are saying it’s a fee paid by gas retailers when distributors load tanker trucks — even though the cost is passed onto consumers through the cost of fuel.
“They are not calling it a tax, and these guys (wholesalers) are adding it to the cost of the fuel, so you are paying a tax on a tax,” Max Castillo, who owns a convenience store and gas station, told the San Diego Union-Tribune. “California is the leader of the nation in paying taxes.”
That’s right, folks, it’s a “fee”. So Californians, who live in the state with the highest taxes, now get to pay a tax on a
tax “fee”. The result?
The global warming tax adds about 10 cents a gallon to wholesale gas prices and 12 cents to diesel prices, reports the Union-Tribune. But with gas prices down about one dollar from last year, few residents have noticed the global warming fee being added to their gas bills.
Californians pay a whopping 77 cents per gallon extra on gasoline due to fees and taxes. The Union-Tribune reports that “[e]xcise taxes… cost consumers 36 cents per gallon for the state and 18.3 cents for the federal government.” This is in addition to the 2 cent underground storage tank fee and the “global warming fee, which is variable and could soar in the future, added about a dime this week.”
The global warming fee adds 2.25 percent to the full retail price of gasoline — which includes existing taxes and fees — meaning that once gas prices start to rise, Californians may take notice when their gas bills go way up.
Science doesn’t support this. It simply isn’t there. And California’s politicians deciding to do it on their own is simply an exercise in political arrogance and vanity. A decision to get the “little people” to again pay for a political boondoggle (see current “light rail” boondoggle). Nothing will come of this in real terms. California fossil fuel usage for transportation needs is 96%. That hasn’t changed much and isn’t likely to change anytime in the near future.
However, that apparently doesn’t prevent politicians from imposing their utopian pipe dreams on the citizens of that state – and frankly, they richly deserve this given their past voting record.
The imposition of a global warming tax on fuel retailers comes as Democratic Gov. Jerry Brown announces plans to push the state to get 50 percent of its energy from green sources and move away from oil.
“If we have any chance at all of achieving that, California, as it does in many areas, must show the way. We must demonstrate that reducing carbon is compatible with an abundant economy and human well-being,” Brown said in a recent speech.
Brown wants to put the state on track to get 50 percent of its energy from green sources, like wind and solar, by 2030 and cut the state’s use of petroleum in half in the next 15 years. Brown also promised more rules to make buildings more energy-efficient.
“All of this is a very tall order. It means that we continue to transform our electrical grid, our transportation system and even our communities,” Brown said.
It’s BS built on a questionable scientific theory based in models which have been found to be horribly wanting and consistently wrong. This isn’t about the environment (other than it will help keep that lobby a bit quieter and in the politician’s pocket), it’s about money – revenue. And power.
But then, when isn’t it anymore?
Thanks to the Progressive movement at the turn of the last century, California, like several other states, has ballot propositions that the voters can approve or disapprove to get around the corrupt pols in the state capital. Here are the propositions on tap for tomorrow.
Proposition 1: Water Bond. Funding for Water Quality, Supply, Treatment, and Storage Projects.
Authorizes $7.545 billion in general obligation bonds for state water supply infrastructure projects, including surface and groundwater storage, ecosystem and watershed protection and restoration, and drinking water protection.
First, we don’t have a lot of space to borrow, especially with a $40 billion train line to build. Actually, we don’t have the money to pay for the $40 billion—some say $63 billion—train. So, let’s find the money in the annual budget for this. I’m sure there’s some spare change lying around with a $108 billion dollar budget in 2014, which is, by the way, $7 billion more than the 2013 budget.
Proposition 2: State Budget. Budget Stabilization Account. Legislative Constitutional Amendment.
Requires annual transfer of state general fund revenues to budget stabilization account.
This seems like a minimal nod to fiscal responsibility. I’ll buy it.
Proposition 45: Healthcare Insurance. Rate Changes. Initiative Statute.
Requires Insurance Commissioner’s approval before health insurer can change its rates or anything else affecting the charges associated with health insurance.
First of all, we already intentionally cut the insurance commissioner out of this loop by creating an independent commission to review rate changes. We did that because the insurance commissioner is an elected political hack who already has too much scope for hackery. If this passes, then health insurers will be prevented from raising rates by whatever San Francisco hippie gets elected insurance commissioner. Which sounds nice until you realize that insurers will lose money and simply leave the state.
Proposition 46: Drug and Alcohol Testing Of Doctors. Medical Negligence Lawsuits. Initiative Statute.
Requires drug testing of doctors. Requires review of statewide prescription database before prescribing controlled substances. Increases $250,000 pain/suffering cap in medical negligence lawsuits for inflation.
Nobody wants to be treated by a crack-addled doctor, right? So, who could be against this? Well…me. Here’s the thing: This has very little to do with ensuring doctors aren’t drug addicts, and everything to do with trial lawyers looking for big malpractice paydays, by increasing payouts for malpractice lawsuits. That means malpractice insurance premiums will skyrocket, and doctors will leave the field…or the state. The doctor drug testing is eyewash to hide a trial lawyer money-grab. Screw those guys.
Proposition 47: Criminal Sentences. Misdemeanor Penalties. Initiative Statute.
Requires misdemeanor sentence instead of felony for certain drug and property offenses. Inapplicable to persons with prior conviction for serious or violent crime and registered sex offenders.
Right now, we have mandatory sentences for non-violent drug offenders. So we have to make room for them in prison. We don’t have that room, so we let robbers, muggers, and rapist, et al., go free instead. If you commit a non-violent offense, you simply shouldn’t go to jail, period. We need to keep people who hurt people in jail. If your crime is having a gram of coke or 2 ounces of weed, I can’t even count the number of shits I don’t give about imprisoning you.
Proposition 48: Indian Gaming Compacts. Referendum.
A “Yes” vote approves, and a “No” vote rejects, tribal gaming compacts between the state and the North Fork Rancheria of Mono Indians and the Wiyot Tribe.
Do you know what I care less about than imprisoning non-violent criminals? Whether or not Indians can have casinos, and whether they can have them outside their tribal lands. Besides, I really like the buffets.
So, there you have it: All of the propositions on the ballot. I wouldn’t dream of telling you how to vote, but I am telling you how I am going to vote. With that in mind…you know what to do.
We’ve talked about this at other times in the past but there are some examples in a recent Victor Davis Hanson peice that make the point again. Science is science. It should not be something in service to anything, especially politics. It should stand alone and we should deal with its findings as objectively as possible. Unfortunately, today we have “science” (and yes the quote marks do indicate that what I’m going to note has nothing to do with real science) in the service of politics and for hire to whomever can provide it the most grant money. It’s become a bit like expert witnesses in court. Need one to conclude a certain way? We can find that “expert” for you.
Anyway, there is one particularly egregious example in the VDH piece (at least more egregious than some, at least to me) that I want to note because it has so recently been in the news and used in politics to further an agenda:
The president still talks of “settled science” in the global-warming debate. He recently flew to California to attribute the near-record drought there to human-induced global warming.
There is no scientific basis for the president’s assertion about the drought. Periodic droughts are characteristic of California’s climate, both in the distant past and over a century and a half of modern record-keeping. If the president were empirical rather than political, he would instead have cited the logical reasons for the fact that this drought is far more serious than those of the late 1970s.
California has not built additional major mountain storage reservoirs to capture Sierra Nevada runoff in decades. The population of the state’s water consumers has almost doubled since the last severe drought. Several million acre-feet of stored fresh water have been in recent years diverted to the sea — on the dubious science that the endangered delta smelt suffers mostly from irrigation-related water diversions rather than pollutants, and that year-round river flows for salmon, from the mountains to the sea, existed before the reserve water storage available from the construction of mountain reservoirs.
In other words, government has been lax (no forward planning or construction for the water needs of an expanded population), environmentalists have been extreme (demanding an entire valley be dried up for a mostly useless fish) and the result has been to aggrevate a natural penomenon to disaster levels.
But they will tell you that it has to do with “global warming”, not poor government, not environmental extremism. What Obama is pushing is pseudo-science, fashioned to support a political position. There is no reason that this drought should be as severe as it has been. And again – it isn’t global warming causing the severity.
Remember, this was the guy who promised he’s put science back in the place it belonged. Apparently that place is the same place he claimed it was before he took office. As a political tool to push an ideological agenda. That’s precisely what he was doing in California.
But then, the fact that he lied shouldn’t suprise anyone, given his track record.
First let me thank all the great QandO readers who sent their condolences upon my brother’s passing. They are greatly appreciated.
Now on to the nasty business of government and politics – in particular, the abominable law called ObamaCare:
An estimated seven out of every 10 physicians in deep-blue California are rebelling against the state’s Obamacare health insurance exchange and won’t participate, the head of the state’s largest medical association said.
“It doesn’t surprise me that there’s a high rate of nonparticipation,” said Dr. Richard Thorp, president of the California Medical Association.
Why? Because doctors refuse to work for a pittance. They provide something of value and believe they should be compensated accordingly. But with price fixing by the government, they’re just not going to get their just compensation. So they’re not going to play the game and join in.
California offers one of the lowest government reimbursement rates in the country — 30 percent lower than federalMedicare payments. And reimbursement rates for some procedures are even lower.
In other states, Medicare pays doctors $76 for return-office visits. But in California, Medi-Cal’s reimbursement is $24, according to Dr. Theodore M. Mazer, a San Diego ear, nose and throat doctor.
In other states, doctors receive between $500 to $700 to perform a tonsillectomy. In California, they get $160, Mazer added.
Only in September did insurance companies disclose that their rates would be pegged to California’s Medicaid plan, called Medi-Cal. That’s driven many doctors to just say no.
In fact, as pointed out above, only 30% of the state’s doctors have opted in.
Gee, let’s see the left take the doctor’s side here, okay? Aren’t they the ones always wanting the raise the “minimum wage”. Well, as is obvious here, the “wage” offered is below the “minimum” doctors believe they should be payed. The left ought to be out in the street in protest of this travesty.
Higher pay for doctors! After all, most of them are small business owners and … oh, wait, that makes them the bad guys. I forgot. The left isn’t going to protest this because these guys are privileged or something. Nevermind the fact they provide jobs for others and can’t pay them more than they receive.
I’m sure trying to think this through and come to an equitable solution will shred a few brains on the left.
You’d think, by now, governments would have figured out how poor they are at picking winners and losers.
Of course, they haven’t as witnessed by the witless California government continuing to push solar energy.
California’s Riverside County is producing more solar energy than anywhere in the U.S., with close to a dozen solar plants either online or proposed.
“On the face of it, it looks like a good deal. They talk about all these huge jobs and long-term benefits to the county. The truth is, it’s a very short term,” Riverside County Supervisor John Benoit said. “We’re going to be carrying the burden of having these types of facilities for decades to come, and because of the incentives that have been provided by federal and state government, there’s virtually nothing left for the county government or the local people to get benefit back after the small number of construction jobs are gone.”
Unlike Riverside’s 500 megawatt natural gas-fired facility, which pays $6 million a year in property taxes, a solar plant being built a few miles away will pay next to nothing, just $96,000. When Riverside balked at its own upfront infrastructure costs and tried to impose an impact fee, the industry sued.
So Riverside has hundreds of square miles carpeted with solar panels and no jobs to speak of and barely any revenue to show for it.
But surely, as promised, this has led to cheap, reliable and renewable energy, right?
Yeah, not so much:
Solar also promised to be a cheap source of power, fueled by the sun. What the industry didn’t say is the technology only converts a fraction of the sun’s energy, and the intermittent nature of sunshine does not produce the power promised.
And Stanford economist Frank Wolak, a California energy expert, said solar could boost consumer energy bills up to 50 percent, a finding similar to the state Public Utilities Commission. Solar power from two recently approved plants range from $100 to $200 per megawatt hour, at least 8 times higher than the $16 consumers pay for natural gas.
“It’s probably 50 percent more (than coal or natural gas) today,” Benoit said. “Five years ago, it was probably a 100 or 150 percent more costly to generate a kilowatt with solar. The cost of these panels has come down dramatically. But still, getting back to the old equation, do you want to spend a little bit more to be green? And the legislature and the governor in California have said clearly, we’re going to do that.”
But at what cost to consumers and to what benefit to much of anything except government’s chosen crony, er, beneficiary? Instead of allowing markets – i.e. consumers and producers – to decide on the mix, government has unilaterally taken that away from them and made the decision itself.
After all, the autocrat has decided:
Answering critics at a solar ribbon-cutting earlier this year, Gov. Jerry Brown laid down the gauntlet, affirming his commitment to solar energy and saying he would “crush” opponents of solar.
“There are going to be screw-ups. There are going to be bankruptcies. There’ll be indictments and there’ll be deaths. But we’re going to keep going – and nothing’s going to stop me,” Brown said.
I can believe that. Somebody needs to tell Brown the whole effort is a ‘screw-up’.
But since government is involved, the crony gets the treatment other industries don’t:
“There’s been a policy to fast-track and install these utility-scale renewable energy installations that are on the scale of five to 10,000 acres each,” said April Sall of the Wildlands Conservancy. “We’ve seen thousands of acres of the desert bladed and now undergoing utility-style construction to basically convert that from pristine habitat that included those sensitive plants and animals, to becoming potentially a dust bowl.”
Now imagine if these actions and plans were those of “Big Oil”. Yup, you don’t have to imagine long, do you? But in this case?
The two largest green groups in the U.S., the Sierra Club and Natural Resources Defense Council, have remained silent on the impact of Big Solar on land use and endangered species, which is not so with gas, oil or coal. Sall and other local environmental groups say the Washington-based organizations see climate change as a bigger threat and therefore won’t get involved.
Shoddy “science” is their excuse and they’re sticking with it.
And that’s your update on the imperial blue state model today. And yes, it’s going down the tubes which is why this cartoon applies to more than small business in the state:
California, of course:
“The California Republican Party is functionally dead. And how is California doing, now that liberals have successfully terminated the state’s remaining conservatives?” #1 in debt, #1 in welfare, #1 in taxing the rich. And hoping for a federal bailout, I suspect. As is Illinois, which is in similar straits for similar reasons. “One-third of all the nation’s welfare recipients live in the state, despite the fact that California has only one-eighth of the country’s population. That’s four times as many as the next-highest welfare population, which is New York. Meanwhile, California eighth-graders finished ahead of only Mississippi and District of Columbia students on reading and math test scores in 2011.”
You can warn people till you’re blue in the face (no pun intended) how the blue state model is going to end up, but sometimes it is instructive to just let it happen. Of course that assumes that those observing the train wreck try to understand how it happened and work to avoid it elsewhere. I’m not so sure that’s the case in this nation. But fair warning, given the fiscal road we’re on California is as much in our future as Greece:
“For a century or so, guided by brilliant private sector leadership, California was a beacon to the world, a land of opportunity such as never had existed in human history. Unimaginable wealth was created. Yet it required only 40 years of liberal governance to bring the whole thing crashing down. Today, California is the most spectacular failure of our time. Its government is broke. Productive citizens have been fleeing for some years now, selling their homes at inflated prices (until recently) and moving to Colorado, Arizona, Texas and even Minnesota, like one of my neighbors. The results of California’s improvident liberalism have been tragically easy to predict: absurd public sector wage and benefit packages, a declining tax base, surging welfare enrollment, falling economic production, ever-increasing deficits. Soon, California politicians will be looking to less glamorous states for bailout money. Things have now devolved to the point where California leads the nation in poverty.”
California is a state which has modeled blue government for decades, despite warning of where it’s continuance would lead.
And, shockingly to the left, it has ended up right where it was predicted it would end up. Yet, they blindly and willfully continue to march along as though the reality will change and economic laws will disprove themselves if they just persist in their actions.
California is our future. Our near future. See, it’s pretty much as simple as this:
If a country runs a deficit (as a percentage of GDP) that is equal to its growth rate, the debt level will remain constant. This year U.S. GDP will be a little less than $16 trillion, and its historical growth rate is 3.25%. That works out to what we might call a “safe” deficit of $520 billion, or even $600 billion if you allow for a little inflation. Last year, however, the U.S. deficit was $1.1 trillion — or roughly $500 billion too much.
That gap could be closed by ending all tax cuts, tax breaks and stimulus payments for everyone, according to the Tax Policy Center. But two-thirds of the burden would fall on the middle class — something both political parties want to avoid. All the proposed tax increases on the wealthy, however, even combined with the end of the payroll-tax cut, would raise only $295 billion. So unless there were spending cuts twice as big as the ones currently scheduled, the deficit would still be too large.
Those sorts of cuts aren’t even being discussed. Imagine, if you would, radical cuts in the size and scope of our current federal government. Imagine subsidies of all sorts being eliminated. Imagine backing government out of many of the areas it has no business. Imagine simplifying the tax code and giving business a warm fuzzy feeling about the business atmosphere by freezing regulation and in some instances rolling them back. Imagine all of that, because none of it is going to be done.
Instead, the solution is to “tax the rich”.
So let ‘em have it (only if they repeal the Hollywood tax cut). Tax the rich. And when it doesn’t work, and it won’t (in fact, I’m not sure what “work” means in this particular case since the amount to be collected is a mere drop in a 1.6 trillion dollar ocean of debt that’s planned each year for the foreseeable future), they’re left with a lot fewer excuses, huh?
Not that they won’t try to point fingers when their grand plan crashes.
Yup, in the end it all looks like we’re headed to California. Apparently we’re going to have to recreate that debacle on a national level before the blinders come off of the public and the realization that you can’t spend more than you have forever finally sinks in.
Whether or not it will too late to salvage the country at that point, remains to be seen.
Once again, it’s time to take a look at the biennial crap that various idiots try to foist on us here in California at election time, known as the ballot propositions. This election there are ten of them. Let’s see what they’ve cooked up for us this year.
PROP 30: TEMPORARY TAXES TO FUND EDUCATION. GUARANTEED LOCAL PUBLIC SAFETY FUNDING. INITIATIVE CONSTITUTIONAL AMENDMENT.
Increases taxes on earnings over $250,000 for seven years and sales taxes by ¼ cent for four years, to fund schools. Guarantees public safety realignment funding. Fiscal Impact: Increased state tax revenues through 2018–19, averaging about $6 billion annually over the next few years. Revenues available for funding state budget. In 2012–13, planned spending reductions, primarily to education programs, would not occur.
NO: California already has incredibly steep income taxes. The top rate of 9.8% hits at $38,000 per year. And the sales tax rate is already over 7%. This is just insane, and they want to make it…insaner. Hey, here’s an idea, how about we stop cops and CDF firemen retiring at 50 with 85% of their top salary? How about we randomly fire half the Administrators in our schools, who ,in many districts, outnumber the actual teachers? Or, how ’bout weekly tarring and feathering of state legislators until they figure out how to cut spending?
PROP 31: STATE BUDGET. STATE AND LOCAL GOVERNMENT. INITIATIVE CONSTITUTIONAL AMENDMENT AND STATUTE.
Establishes two-year state budget. Sets rules for offsetting new expenditures, and Governor budget cuts in fiscal emergencies. Local governments can alter application of laws governing state-funded programs. Fiscal Impact: Decreased state sales tax revenues of $200 million annually, with corresponding increases of funding to local governments. Other, potentially more significant changes in state and local budgets, depending on future decisions by public officials.
NO: The California Democratic Party opposes it. I can’t imagine anything the California Democratic Party opposes that I would not automatically be for. Except maybe this. This seems like a disaster in the making. It’s so fricken’ complicated and gives so much power—including tax power—to unelected bureaucrats, that I can’t see how this could possibly do anything but make things worse. The GOP is for it, but the California Federation of Republican Women and some TEA Party groups are against it. This one is just all over the map. Absent something clearer and less complicated, I’m saying "No". There’s a way to fix Sacramento, but this ain’t it.
PROP 32: POLITICAL CONTRIBUTIONS BY PAYROLL DEDUCTION. CONTRIBUTIONS TO CANDIDATES. INITIATIVE STATUTE.
Prohibits unions from using payroll-deducted funds for political purposes. Applies same use prohibition to payroll deductions, if any, by corporations or government contractors. Prohibits union and corporate contributions to candidates and their committees. Prohibits government contractor contributions to elected officers or their committees. Fiscal Impact: Increased costs to state and local government, potentially exceeding $1 million annually, to implement and enforce the measure’s requirements.
YES: This is a similar bill to the one that Gov. Scott Walker got passed in Wisconsin. The unions that currently own Sacramento HATE it. They can go screw.
PROP 33: AUTO INSURANCE COMPANIES. PRICES BASED ON DRIVER’S HISTORY OF INSURANCE COVERAGE. INITIATIVE STATUTE.
Changes current law to allow insurance companies to set prices based on whether the driver previously carried auto insurance with any insurance company. Allows proportional discount for drivers with some prior coverage. Allows increased cost for drivers without history of continuous coverage. Fiscal Impact: Probably no significant fiscal effect on state insurance premium tax revenues.
YES: Right now, if you have auto insurance, and you switch companies, your new company can’t offer you a discount for being continuously covered. Now, this could mean that if you voluntarily stop driving for a while, your new rates won’t be discounted. The opponents act like this is a Big Deal, and the Democrats shriek in horror at the very idea. I, on the other hand, would like to be able to switch companies without having a big premium increase.
PROP 34: DEATH PENALTY. INITIATIVE STATUTE.
Repeals death penalty and replaces it with life imprisonment without possibility of parole. Applies retroactively to existing death sentences. Directs $100 million to law enforcement agencies for investigations of homicide and rape cases. Fiscal Impact: Ongoing state and county criminal justice savings of about $130 million annually within a few years, which could vary by tens of millions of dollars. One-time state costs of $100 million for local law enforcement grants.
YES: I don’t have any philosophical problem with the death penalty. Some people need killin’. On the other hand, I have no great respect for the system of criminal justice here in California, either. For whatever reason, we just don’t have a very good system for ensuring that the only people we execute are people who actually need killin’. Until we do, we probably shouldn’t be killing anybody.
PROP 35: HUMAN TRAFFICKING. PENALTIES. INITIATIVE STATUTE.
Increases prison sentences and fines for human trafficking convictions. Requires convicted human traffickers to register as sex offenders. Requires registered sex offenders to disclose Internet activities and identities. Fiscal Impact: Costs of a few million dollars annually to state and local governments for addressing human trafficking offenses. Potential increased annual fine revenue of a similar amount, dedicated primarily for human trafficking victims.
NO: First, we already have stiff penalties against human trafficking. We’re pretty serious about it. But this goes way too far. It reminds me of the Federal law in place for the military, where if you go to a strip club, and it’s later found to be engaged inn human trafficking, you could go to jail for many, many years. It’s draconian, and unnecessary, and will result in a lot of innocent people getting labeled as sex offenders and human traffickers who never actually engaged in human trafficking. It’s a wild over-reaction to an admittedly serious problem.
PROP 36: THREE STRIKES LAW. REPEAT FELONY OFFENDERS. PENALTIES. INITIATIVE STATUTE.
Revises law to impose life sentence only when new felony conviction is serious or violent. May authorize re-sentencing if third strike conviction was not serious or violent. Fiscal Impact: Ongoing state correctional savings of around $70 million annually, with even greater savings (up to $90 million) over the next couple of decades. These savings could vary significantly depending on future state actions.
YES: OK, I’m starting to come off like some bleeding heart, soft-on-crime, 60s liberal here, but this is a better application of the three strikes law. Right now, a guy with two strikes could a life sentence if his third strike is having an ounce of weed on him. Any third felony counts as a third strike. This would limit the third strike to a violent felony, which is who we really want in prison, anyway. There’ve been some ridiculous third strike convictions here in CA, and this would stop that, while ensuring violent offenders get put away.
PROP 37: GENETICALLY ENGINEERED FOODS. LABELING. INITIATIVE STATUTE.
Requires labeling of food sold to consumers made from plants or animals with genetic material changed in specified ways. Prohibits marketing such food, or other processed food, as “natural.” Provides exemptions. Fiscal Impact: Increased annual state costs from a few hundred thousand dollars to over $1 million to regulate the labeling of genetically engineered foods. Additional, but likely not significant, governmental costs to address violations under the measure.
NO: More costly green crap. It’ll be a boon for trial laywers, make food in California more expensive, and will drive farmers out of the state, and small grocers out of business. Sheer idiocy.
PROP 38: TAX TO FUND EDUCATION AND EARLY CHILDHOOD PROGRAMS. INITIATIVE STATUTE.
Increases taxes on earnings using sliding scale, for twelve years. Revenues go to K–12 schools and early childhood programs, and for four years to repaying state debt. Fiscal Impact: Increased state tax revenues for 12 years—roughly $10 billion annually in initial years, tending to grow over time. Funds used for schools, child care, and preschool, as well as providing savings on state debt payments.
NO: I don’t have any kids. Give ‘em gruel, and let ‘em know in no uncertain terms that children are to be seen, not heard. Preferably with beatings. And get Sacramento’s hand out of my pockets. This state wastes a shocking amount of money, then when they come up short, somehow it becomes my problem.
PROP 39: TAX TREATMENT FOR MULTISTATE BUSINESSES. CLEAN ENERGY AND ENERGY EFFICIENCY FUNDING. INITIATIVE STATUTE.
Requires multistate businesses to pay income taxes based on percentage of their sales in California. Dedicates revenues for five years to clean/efficient energy projects. Fiscal Impact: Increased state revenues of $1 billion annually, with half of the revenues over the next five years spent on energy efficiency projects. Of the remaining revenues, a significant portion likely would be spent on schools.
NO: Another tax. This time on out of state businesses, to force them to pay CA income tax if they do business here. Well, guess what, they just won’t do business here, you dolts. So, A) you won’t get the tax revenue you say you will, B) people in CA who work for those companies will join the ranks of the unemployed, losing us even more tax revenue, and C) if you do get any revenue, you’ll blow it on wind-powered solar sails, or some such nonsense. And if there’s another Solyndra-style black hole to pour money into, you can bet the rocket scientists in Sacramento will unerringly find it.
PROP 40: REDISTRICTING. STATE SENATE DISTRICTS. REFERENDUM.
A “Yes” vote approves, and a “No” vote rejects, new State Senate districts drawn by the Citizens Redistricting Commission. If rejected, districts will be adjusted by officials supervised by the California Supreme Court. Fiscal Impact: Approving the referendum would have no fiscal impact on the state and local governments. Rejecting the referendum would result in a one-time cost of about $1 million to the state and counties.
YES: Even the sponsors of the proposition have withdrawn their sponsorship. The CA Supreme Court has already kept the old Senate districts in place for 2012, thwarting the will of the people on getting the redistricting out of the hands of the Democrats in Sacramento. They’ll do it again in 2014 without it. Jeebus, this is such a corrupt state.
Well, that’s the run-down for this election. Now that you know how to vote properly, do your duty.
Reality is a great test of belief. Sometimes, the things you believe are confirmed by experience. Sometimes they aren’t. And sometimes, reality is so at odds with what people believe, they have to be complete dolts to keep believing it. But, I constantly see people who believe things that simply can’t be true, and it bothers me.
Ultimately, reality tells you whether what you believe is true or not. And if reality conflicts with what you believe, it isn’t reality that’s got it wrong.
The Stimulus Cheerleaders
Basically, it’s the unreconstructed Keynesian crowd. Popularly led by Paul Krugman—who is a Nobel Laureate economist—they continue to argue that the problem with the economy is that the government simply didn’t spend enough to properly stimulate the economy.
There’s so much wrong with that, it’s hard to know where to start.
First, let’s accept that in a range of circumstances, it actually is true that the government can stimulate the economy via deficit spending. As long as there’s not too much debt in the economy as a whole, you can prime the economic pump through deficit spending, especially if you have a fiat currency. We’ve done it lots of times since WWII.
So, up to a point, even if you have a credit bubble that collapses, you can re-inflate it by essentially transferring that debt to the Government via deficit spending.
Up to a point.
As I’ve mentioned previously, the newest ECB research indicates that, in developed economies, once you reach a government debt load of about 100% GDP, it begins to drag on the economy, reducing economic growth by about 1% annually. So, what should be 3% annual GDP growth becomes 2%. And as the debt gets bigger, the drag gets bigger, faster.
Now, ever since Reagan and Congress began serious, constant deficit spending in the 80s, there have been worries that the government debt would begin to crown out private markets, and slow the economy. But it never happened.
Well, until now, as we crossed that 1:1 GDP to debt ratio.
Moreover, the idea that we haven’t spent enough to stimulate the economy is simply farcical. In 2008, the total national debt was less than $10 trillion. Now it’s over $16 trillion. So no matter whether or not we spent X amount of money marked "stimulus", we’ve spent so much money that we’ve added more than $6 Trillion in debt in just 4 years. That’s a lot of stimulus.
Arguing that we needed to spend more is…counterintuitive. If $6+ trillion won’t do it, then it probably can’t be done.
Besides, we already learned there was a fundamental problem with Keynesian economics when we had stagflation in the ’70s, which was supposedly impossible.
Here’s the thing about looting the system. Once you’ve looted it…it’s been looted. The Greeks seem utterly incapable of understanding that the system can’t continue to dole out benefits once you’ve looted it. It’s not the Germans that are making life difficult for the Greeks, by refusing to give them more money. It’s the Greeks that have made life difficult for themselves by spending themselves into a 1.28:1 Debt to GDP ratio.
Austerity, of course, isn’t pleasant—at least not the way they’ve implemented it. What they needed was public sector austerity, i.e., spending cuts, not private sector austerity, i.e., tax increases. Instead, they got both. What they needed were massive spending cuts, and debt repayment.
But, of course, in a country where practically every cop, teacher, and fireman is a unionized employee of the state, and half of the private citizens get some sort of cushy government benefit payment, much public sector austerity was a political non-starter. So they gave themselves a little public austerity and a lot of private austerity…and the economy collapsed. I mean, no matter what they did, they were in for a tough time, but they chose the most destructive path possible, then blamed it on the Germans.
The thing is, the Germans are historically…impatient with foreigners that they find troublesome. But the Greeks have decided that, having looted their economy completely, it’s the Germans’ fault somehow. The Greek position is, "We want to stay in the euro without worrying about our deficits, borrow money from Germany, never pay it back, and tell anyone who questions this to go screw."
The Germans, as are their wont, are unamused.
The list of odd things Californians believe that are directly contradicted by observable reality is, of course, far to long to be described here. A representative sample, however, includes:
- Maintaining a permanent class of illegal immigrants in modern-day helotage will not reduce employment among the minority citizenry. Giving them full access to state benefits and education will not strain the schools, medical system, or state budget.
- California must have the strictest environmental, tax, and employment regulation possible. This will not result slower economic growth, or a business exodus to another state. Similarly, stringent environmental regulation for the benefit of small fish or birds, and significantly reducing the water available for irrigation, will have no effect on farming in the central valley, and, hence, agricultural prices paid by consumers.
- It is completely possible to allow state employees to retire as young as 50, with an annual pension payment 85% of their highest salary, and fully meet our pension obligations, because the Dow will be at 24,000 by 2009, and 24,000,000 by 2099, thus making the latest round of pension increases perfectly sustainable through investment.
- If we’re taxing California workers 10% of their income, and we have a $16 billion budget deficit, the problem is that we obviously aren’t taxing enough. We should, therefore, tax higher income earners much more, because they can never leave California and move to Arizona. Or Texas.
California is just Greece with movie stars.
I could go on and on, but, you probably get the point.
The problem with reality is that it doesn’t care what you believe. It just is. The longer you ignore it, the more forceful it is when it re-asserts itself. But if I could point to one thing as the worst modern problem we have today, it would be an absolute refusal to acknowledge reality, accompanied by a steadfast refusal to recognize any of the warning signals it obligingly gives before its assertion becomes horrific, rather than merely unpleasant.
If you make the decision to ride this thing down in flames, reality will be perfectly happy to let you do it.
Good old California, probably the most debt ridden state in the union, and it still can’t manage to break its big spending ways. It certainly seems intent on wasting buckets of money it can ill afford on a poorly conceived public project.
When the California legislature undertook the most expensive public-works project in American history, they also created an independent review board to ensure that the LA-to-San Francisco high-speed rail project would have solid financial footing. Perhaps they intended this panel to be a public-relations rubber stamp, but if so, it just proves that their miscalculations weren’t limited to cost projections. Yesterday, the California High-Speed Rail Peer Review Group sent a “scathing” letter to the political leadership in Sacramento, calling the project’s finances and costs “fundamentally flaw[ed]”.
What did the letter say?
In a report Tuesday, a panel of experts created by state law to help safeguard the public’s interest raised serious doubts about almost every aspect of the project and concluded that the current plan “is not financially feasible.” As a result, the panel said, it “cannot at this time recommend that the Legislature approve the appropriation of bond proceeds for this project.”
The project’s newest “official cost” is $98.5 billion, three times the original “official estimate” of $33 billion. Of course the Rail Authority thinks the panel is full of beans. And Governor Jerry Brown?
Brown spokesman Gil Duran said in an e-mail that the Peer Review Group’s report “does not appear to add any arguments that are new or compelling enough to suggest a change in course.”
Of course he doesn’t. Because Moonbeam, elected to get the California financial house in order, sees nothing wrong with another hundred or so billion in debt for a debt strapped state.
The intent is obviously to go forward with this boondoggle regardless of its feasibility. Morrissey points out, the board was intended to be a device to appease critics and to rubber stamp the project. The fact that it hasn’t worked out that way is inconvenient, but is not going to stop something that they really want. The fact that the voters voted to do a project with a $33 billion dollar price tag in 2008 and has now seen that estimate triple should provide more than enough of an argument whether “new” or not, to stop the California equivalent of the “Big Dig”.
Sounds like California’s political class has learned nothing from their financial travails of the last several years.
What sounded “feasible” in 2008 is obviously anything but feasible, financially, in 2012, especially when the projected cost has tripled since its voter approval. That alone makes it infeasible. It completely changes the game. It is a classic “bait and switch” – a lowball estimate to gain approval and a commission which no one obviously planned on listening too empaneled to give the project of veneer of accountability.
But as usual, politicians have again decided to ignore reality and go ahead with an unnecessary and hugely expensive boondoggle despite mounting evidence, and cost, that it should be abandoned.
You just read about things like this and shake your head. What in the world is wrong with those people? What part of “we can’t afford this sort of nonsense anymore” do you suppose they don’t understand? Or is it they just don’t care? Politics and an agenda, coupled with crony capitalism, overrule common sense once again.
Perhaps I’m missing something here but hasn’t the main argument of this administration about the various immigration laws passed by states been that immigration is the solely the job of the Federal Government?
Isn’t it true that they’ve challenged various state level immigration laws on those very grounds?
Nearly 1 million undocumented immigrants could live and work openly in California with little or no fear of deportation under an initiative unveiled Friday by a state legislator and others. Assemblyman Felipe Fuentes, a Democrat, is helping spearhead the measure, called the California Opportunity and Prosperity Act.
The proposal was filed Friday with the state Attorney General’s Office, marking a first step toward a drive to collect the 504,760 voter signatures needed to qualify for the ballot. Fuentes called the measure a "moderate, common-sense approach" necessitated by the federal government’s inability to pass comprehensive immigration reform.
"I hope this shows Washington, D.C., that if they fail to act, California will take the lead on this critical issue," Fuentes said in a written statement.
I’m sure Eric Holder’s DoJ will be asking, fairly quickly, by what right California assumes the right to do such a thing. You know, in other states, they were at least trying to enforce existing federal law when they were challenged. Here’s a guy trying to circumvent it. I would assume that would give the chief law enforcement officer, who has been so quick to jump on those states trying to enforce existing federal laws, to be on this guy like white on rice.
Regardless whether Californians would support such a measure, implementation would depend upon the federal government agreeing not to prosecute participants.
Well, lets see … didn’t California legalize medical marijuana and didn’t the feds say it didn’t matter because it was against federal law to engage in such activity? And didn’t they continue to prosecute marijuana cases and raid supposed “legal” providers?
So what about circumventing federal law in this case?
Oh, and of course, nothing could go wrong with this could it? A “million” illegals get amnesty. California becomes a magnet for illegals. Pay taxes? Why? They’re illegal and there’s no penalty for that. Why fess up and pay taxes? California has already said it’s not going to deport them. That doesn’t mean they’re then going to pay taxes for heaven sake.
Another brilliant idea brought to you by a … Democrat.