California Consolation Prizes

    It is obvious to all that California is losing the game in terms of budget deficits with the resultant impact on education and social services - and has been for a long time.  Sometimes it is not enough to play better, you have to change the game.  Some of that is happening out here.

    Jerry Brown's first task as governor is to set an honest budget without the gimmics that his predecessors used, within the boundaries of a legislature that is just short of being two-thirds Democrat, and with a set of past voter initiatives that directs significant chunks of state spending. By most accounts his proposals of this week for the next 18 months do that, cutting spending by $12 billion, seeking voter approval to extend "temporary" taxes (.25% on income; 1% on sales) for another $12.5 billion, and protecting only k-12 education. He is using a scalpel, eliminating some programs entirely (redevelopment agencies; enterprise zones), adding copays for Medicaid, cutting his staff by 25%, and cutting government cars and cell phones. A good start.

    Brown has two legacies from his "Governor Moonbeam" days that his Jesuit objective introspection will help him address:

        1. His granting of collective bargaining rights to public employee unions in the 70's opened the door and terrible labor practices by subsequent administrations resulted in a $500 billion (?) deficit in public employee pension plans. In July he proposed reform measures to include an increase in retirement ages, elimination of "spiking" of calculations, increased employee contributions, and more effective management of the fund administrators. All directionally correct.

    2. With the passage of Proposition 13 limiting local property taxes in 1978, Governor Brown used state funds to cover immediate shortfalls, accelerating the transfer of funding and control of local activities to Sacramento. Important, but less mentioned, in his budget proposal was the proposal to shift money and programs back to the local level for things such as mental health, foster care, some fire services, and court security. While Prop 13 is sacred state-wide, one could foresee a partial migration toward "local option" where San Francisco can make different decisions than Bakersfield.

    With the election of Mayor Gavin Newsom to Lieutenant Governor and the election of four Chinese Supervisors, San Francisco is undergoing its own shift toward the center. The headlines are about the selection of technocrat City Administrator Ed Lee as interim mayor until November and Police Chief George Gascon replacing the liberal Kamela Harris as District Attorney. (In the Democrats' clean sweep she replaced Jerry Brown as state AG.) But the real message is about  the home-owning, public school attending Chinese community, which makes up one third of the population displacing the ultra-liberal Democratic Party Central Committee establishment at the center of power. For those who like the detail, the key event was Board of Supervisors President David Chiu's decision to support Lee for mayor, abandoning the liberals. Behind the scenes, Newsom delayed moving to Sacramento until it happened, Willie Brown (a long time beneficiary of Chinese support) was a key intermediary, and king-maker Rose Pak of the Chinese Chamber of Commerce had her way.

    In a city and state with few Republicans, this is as good as it gets.

                                                 ----- 

    In light of the Left's mantra that we should all eliminate the vitriol practiced by Sarah Palin and the Tea Party, this week's video is a brief compilation of comments by one of MSNBC's stalwarts.

bill bowen - 1/14/11 

 

 

   

Comments

[Bill McCormick]

JOBS????

Interesting news these days relative to jobs. Here are some of the things to ponder when we think of the environment for job resurgence:

1. Foreclosures topped 1,000,000 in 2010 and with 250,000 left over from 2010 bankers anticipate more than 1,000,000 in 2011. Banks have reached the point where they are boarding up many foreclosed homes and not even putting them on the market for sale. This cannot be a good sign for the return of the housing markets any time soon.

2. Oil prices are closing in on $100/barrel and gasoline is pushing over $3.10 this week with diesal fuel at $3.35. This is likely to be the result of a double whammy of lower domestic production due to Obama's restrictions on offshore oil drilling and the devaluation of the dollar making oil more expensive to import. Gas will likely close in on $4/gallon by summer time taking billions out of the hands of consumers and adding dramatically to transportation costs for shippers. You might remember that studies in the 70's showed that when oil reaches $100/barrel alternative fuels become more economically feasible. It would really be too bad if the administration is intentionally ignoring the effects on the economy of higher energy prices in order to "make a case " for carbon trading, cap and trade, and electric cars. What do you think?

3. The effects on food prices of the devalued dollar, the use of grain for ethanol and higher transportation costs are beginning to show as food prices spiral upward again putting more pressure on the American household budgets.

4. Psychologically Americans are beginning to sense the campaign beginning for 2012. Way too early-- but the coming fight over healthcare with debate today followed by whatever happens in the Senate later this week will initiate the battles. It will be quickly followed by the war over the debt ceiling. This will be interesting to watch as there will likely be three camps instead of the normal two. There will be Dems who just go along with the business as usual--raise the ceiling as much as the President needs to get his programs funded and reelected. Then there will be the Tea Party followers who will want to take a stand on the debt ceiling and say hell no. Then there will be the old line Republicans who are preaching the new conservative line "we learned our lesson" who will want a compromise: spending cuts in return for a debt ceiling increase. The result will be a "The Good", "The Bad", "The Ugly" debate once again causing great anxiety in America as the news people speculate on the effects of government shutdowns, economic penalties for default and the struggle for power between the new House and the President. Meanwhile the Senate and Harry Reid hold the high ground able to defeat anything the President wants defeated. And, able to water down any compromise in order to get it passed. The only glimmer of hope for the nation is the many Democrtic Senators being (dare I say it) targeted for defeat in 2012 by the opposition. Perhaps they will actually force compromise in order to save their jobs.

5. My friends in the Transportation industry say there has been a huge surge in shipping in the country indicating that economic activity could finally be prompting a rebuilding of inventories.
It will indeed be too bad for Americans if this is shut down by the above developments.

6. Politically the left has ignored the President's somewhat weak request to turndown the "you prompted murder" accusations against Sarah Palin, the conservative talk radio hosts and Fox. Instead they have increased the charges now to include racism and immigration charges. Sensing blood in the water the sharks have moved in on Palin, Fox and Limbaugh trying to knock out Palin and the Tea Party influence. Not likely the President will rush to their aid. At the same time the move by some Dems to acknowledge that the healthcare bill may be less than perfect combined with Repubs demonstration that the cost impact on the economy is eliminating jobs is keeping Romney (author of the Massachusettes healthcare bill) on the sidelines for 2012. So, Obama is keeping two of his major threats: Palin and Romney out of the race early. Meanwhile consumer confidence will no doubt suffer from all the debate.

Unemployment remains high, Muslims continue to slaughter Christians in the Middle East, a murdering butcher returns to Haiti while President Clinton cannot figure out how to rebuild the island(remember Pelosi declaring the earthquake was an opportuity for Haiti to be better than ever),the Chinese are in town to check on their investment making sure we are following their rules and see how their new Stealth aircraft was received by the Administration.
Have you yet seen any sign that the Administrtion, Congress or the President are focused on Jobs? And yet, a murdering crazy kid attacks a "Blue Dog" Congresswoman and kills her friends and the President's approval rating jumps a few points and the healthcare bill becomes more popular despite England disclosing theirs is financially depressing the country. We are still in fantasy land. Last I looked there was $300B of the stimulus money unspent. That is nearly 40% of it. Let's pay it down on the debt because it is not getting to small businesses. And, without small businesses JOBS will not return.

[Bill McCormick]

Bill and Harrycat,

I don't think any of us would be disappointed if any move toward bipartisan solutions results from this tradgedy.

The constant positioning of the Far right and Far left not only prevents anything from being accomplished but it creates the illusion that the words "conservative" and "liberal" are radical labels. There are actually only a small percentage of Americans so far right and so far left as to actually deserve to be called radical. There is little difference between the right calling Obama a communist and the left calling Bush a war mongerer. It is doubtful that either of these groups have incited mass murderers. But, it is true that both these minorities create false images of politicians and groups they do not like. And, that is sad. For it makes good, talented, brave people withdraw from public service.

As for your hope, Bill, that Obama will heed his own words and not revert to his style of the past 3 years I cannot imagine him doing so. He has an election to win and the high ground from which to defend his programs passed by Pelosi and Reid. He also has an unfinished agenda to promote in cap and trade, immigration, value added taxation and education reform. Perhaps he'll use smoke and mirrors to defer the remaining agenda until post 2012 hoping he'll reduce the losses in 2012 elections to regain some strength but I doubt it. I think he will continue to use the administration to go around Congress and implement as much as he can through regulation. In the meantime much of America will be watching the progress of our "blue dog" friend from Arizona, Congresswoman Gifford in what we all hope will be a miracle recovery to inspire us all. Ironic isn't it that it was Gifford, one who supported the healthcare bill and favors securing the boarder ---about as close to a bipartisan, independent politician (a Democrat often seen on Fox) as there is who took the bullet from this mad man. It would be wonderful for America if she recovers to lead once again.

[bbowen7]

I agree with most commentators that it was an excellent speech. One now hopes that the President does not revert to his "guns to knife fights", "confront your (American) enemies", "sue Arizona" language and posture.

[Harrycat]

Re Presidents speech:
Obama is President for all of us. He has asked us all to tone down the rhetoric. I don't believe that any unbiased observer could claim other than that the Right fringe has poisoned our discourse. The only way this can be diminished is for people of status in the Rep party to demand it. (This applies to the fringe Left as well.) The only senior Rep to speak to this problem so far insisted that his name not be mentioned. That speaks volumes about the problem.

Obama also has asked our discourse to be honest. Many on both sides have overstated or lied about the issues. They must be called out when this happens. Again the only effective voices will be those in the party of the offender.

Are Rep ready to take up the challenge?

[Bill McCormick]

I remember when the Terminator took office. He, too, proposed much to reduce California's problems. The legislature as I recall killed the momentum and castrated him for the remainder of his term. All these less liberal officials are a good start but will they have the votes to take on the public unions, cut the budgets and support the "new" fiscally conservative Jerry Brown? The Chinese have finally stepped up to serve. An interesting development as I remember you and I discussed their seeming disinterest in State wide politics during my visit last year. I suppose eventually we all take a stand when the enemy is at our gates. Could it be that the Chinese will lead California out of the wilderness? How ironic that would be. We are cheering for you.

On the President's speech:
I thought it was well done for 15 minutes but went on too long (as usual for him) but the message was solid. As for the setting I felt a Memorial had been turned into a combination sales opportunity for the President of the University of Arizona and a stage upon which the Democrats paraded their most disliked members of the administration, bible in hand, (Holder and Nepolitano)to read to us from the scriptures in order to offset their prior image of anti right, anti Arizona politicians. It was too bad because it was an opportunity for the President along with his arch enemy the Governor of Arizona to bring the state and the nation a little closer together. Credit the Governor with a solid performance not attempting to politicize or upstage the President.