“Knowledge rests not upon truth alone, but upon error also.”
–Carl Jung
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http://www.forbes.com/2009/07/…
I have to say that while Kotkin comes close once or twice in the article, that he fails to grasp many of the real problems in the state.
1. The Tech and Internet Bubble. California’s economy grew immensely through the “tech” years. This led to a typical boom-and-bust cycle – the kind we’re familiar with here in Colorado – and when the Internet Bubble burst, there were a lot of people paying for very expensive houses in a very expensive market with fewer employment opportunities. People moved out (or were forced out), housing prices crashed, the economy tanked, and businesses looked elsewhere to save money – not just from taxes, but from the high cost of living that sucked profits out through employee wages and benefits.
2. Shifting Tax Burdens. Yes, the very Prop. 13 that the Forbes editorial defended. Kotkin whines and complains about the supposedly crushing tax burden of CA property taxes, but California is becoming more like Colorado Springs – ever-decreasing property taxes are shifting the tax burden into fees and regressive taxes, toward the middle and lower classes and away from the rich. And California has a lot of super-rich people, which distorts complaints that CA gets ~84% of its revenue from the rich – which isn’t too far off of the Federal government number, BTW.
3. Bad Investment Climate. At the same time that property tax revenues are falling, California is getting crushed by all those super-rich people who are no longer earning 20% in the stock market. California’s tax system is weighted towards sales and income taxes, and those are much more volatile than property taxes as El Paso County has seen. Since Kotkin mentioned them, I’ll throw the pension systems in here: CalPERS was hard hit by MBS and CDO investment losses, so some of the blame goes to lack of Federal regulation and poor understanding of these securities by CalPERS investors.
3. Screwed Up Budget Process. It seems that no-one in the California Legislature really wants to “get it done”. Republicans want heavy cuts in social services without considering the external costs of such a move; Democrats want to protect too many jobs and please too many people. The Governator seems intent on chopping away at the margins while ignoring the enormity of the problem. Prop. 13 means they pretty much all have to agree in order to pass the budget or raise taxes.
4. Entrenched Interests. No-one wants to rock the boat in California. The state has been putting this problem off for a long time now, and can no longer avoid a crisis that would have been much easier to fix 10 years ago. Union interests are strong and so are anti-tax forces. Like New York, legislative districts were gerrymandered to protect incumbents in both parties, helping to cement a balance that is unhealthy for the state.
So – they’re coming off of an artificial high, are Constitutionally bound to move away from more constant revenue and toward regressive and volatile taxes, have a hide-bound budget process and more egos than most of Hollywood.
Hope that helps.
There is no rebuttal to the failed CA Spend and Tax Model.
(I’ve decided to treat Libertad the way Walter treats Donny in The Big Lebowski.)
You’re out of your element, Taddy!
Adoption of the economic model that delivers a $40 billion state budget gap isn’t consistant with sound management.
What is the CA pop., 30 mill? Their 2009 budget gap only means they overspent their per capita tax revenues by $1,300/person.
CA spending/capita must be near #1 worldwide.
And yes, they’ve seriously overspent. Rather than fixing the very serious problem with the budget, they’ve been putting it off for years (kind of like Republicans in Colorado before Ref. C…). The people of the state, both parties, and I think every governor since before Reagan have turned a blind eye to the issue until now.
Now they can’t get another loan, now they’re not approving Yet Another Bond Measure, so now they have to face the accumulated budget woes of all those years.
And no, CA’s spending per-capita isn’t even close to #1 world-wide. It’s not even close to #1 country-wide. (Call it 6th or 10th depending on whose analysis you’re using, but 6th is a LONG way back from 1st in dollar terms…)
The business-political elites that drove CA to the brink will fracture … leaving the political elites shanding naked as CA businesses flee regulation, environmental craziness and “maxed out” taxation.
Already responded to it with a rebuttal, won’t do so again.
When someone is quoting The Big Lebowski, bitter is the last thing he or she is feeling.
If you’d prefer to think that my teasing you for your consistently nonsensical and off-topic comments is a sign of bitterness, I’ll just let you, just like a mother who lets her 9 year old who is doing the bunny hop on a cheap BMX think he’s Evel Knievel.
I have noticed that theme thoughout your blogging too; its too bad in your reality fiction is given so much credit.
Slogans and no thought; at least KK linked to an op-ed on the problem.
its a 1st step on the road to recovery
I used to be a Republican, but I got better when I moved out here and saw how dogmatic the Independence Institute and folks like yourself were.
value an out of control spend and tax mentality with zero accountability
Breaking the habit of implementing the bankrupt public subsidy policies of CA, NY or IL must be difficult.
He may not have had the perfect solutions and may not have lobbied perfectly for them – but he proposed substantive change that would have fixed many of the core problems. And it was shot down.
To give him credit, Ahnold has been trying. He got a rather large package of initiatives before the voters in an attempt to fix the budget – and the voters turned them down flat.
I don’t think they were well sold, nor were they necessarily the best solutions, but he was trying.
Now, however, it seems they’re back to the same old model of protecting as much as they can while trimming millions out of a $24 billion deficit hole.
Until they get this fixed use Mozilla, Safari, or Chrome. Details at http://www.dailycamera.com/new…
I hate it. I find absolutely unintuitive for me. Lots of annoying habits.
Opera is the absolute best, Firefox next.
Just skimmed through the site after being gone a while and… Just wow.
I thought the End of Bush and the settling in of Obama might cause an easing up on the aggressively extreme moon-battery.
I thought wrong. Holy crap. Some people just ooze class around here.
…well informed and not rising to name calling (unlike myself!) It’s just his conclusions are wrong!
I think he is one of the classier posters, regardless of spectrum location.
I would have to disagree. He definitely calls people names, and will do it before you do. Hence my ironic comment.
Nonetheless, he’s many cuts above certain hard right polsters who share his viewpoint. But he could learn a thing or two from Laughing Boy, and everyone here could have learned something from Haners…
I just don’t recall such things. Of course, I can’t recall most anything, it seems.
Yes about LB and Haners. Top shelf posters.
I think moon-battery and wing-nuttery will be around long after the heat death of the universe.
But I do agree that things seem to be getting a bit biting around here lately. The last time I recall someone calling for a cool-down period it lasted all of about 10 comments – but I think we all need to remember (myself included) that we’re all here to have a conversation. Just remember…
No job, no money. Eventually faking your way through academia and life was going to catch up with you.
Judge Naves’ kung fu is mighty !
I thought you were a Churchill supporter? I might be wrong, so no offense.
This actually a great outcome. The University had to take responsibility for looking into him because of the negative publicity generated by his idiotic essay, and Churchill is still out of a job for being a lying bag of crap.
Ward Churchill is a vile thief and a liar, and I am no supporter. I read up a lot about his “work” and its disgusting.
I second your sentiments. I actually didn’t have nearly as much a problem with what he said regarding 9/11 as I do with his poser bullshit on Native American issues (which make a mockery of their culture and their history), his blatant plagiarism and his ongoing problem with telling truth from fiction.
Good fucking riddance.
Sufimarie’s not an acolyte? I’m shocked. Sir Robin? What?
Ward is a victim of imperialism! Where are his homies!?!
which (shockingly I know) is in practice used primarily on leftists by right-wingers in government. Whatever people may think about the merits of his academic career, and from what I’ve seen there’s a lot accused and little proved about it, he was targeted because he said something politically incorrect.
It’s a lesson for the rest of us, which was exactly the point.
He’s a victim of being an asshole.
Somebody had to say it, it might as well have been me.
how exactly did this happen? Did the Regents or the Administration admit wrongdoing?
But before it was overturned today by Naves, the leftie blogs and papers trumpeted the Wardster’s ‘win’ over CU.
Honestly, as they should. Political speech is no reason to bring heat on someone, but Churchill’s incandescent asshattery was too glaring for even CU to overlook any longer.
http://www.denverpost.com/ci_1…
Now that Ward Churchill has ended up with the grand total of one dollar – will CU still have to pay David Lane’s likely mid-six-figure attorney fees?