Fiscal Responsibility Never Reigns in California

California, finally, has passed its lousy new budget.

"This is a very difficult budget, but we have turned this crisis into an opportunity to make real, lasting reforms for Californians," [Gov. Arnold Schwarzenegger] said in a written statement. "Some special interests may not like this budget -- but like I always say, what's good for the people is not always good for special interests."

"Real, lasting reforms"? I recall similar hot air from Schwarzenegger five years (and $40 billion in state budget increases) ago. There's much less reason to believe it now.

For a more comprehensive look both at real reform and the flagrant government irresponsibility that has brought the Golden State to the brink, I'll direct everyone's attention to a brand new study by Adam Summers and the Reason Foundation, "California Spending by the Numbers: A Historic Look at State Spending from Gov. Pete Wilson to Gov. Arnold Schwarzenegger" [pdf]. Here's one of many excerptables:

A good rule of thumb in government budgeting is that the rate of spending increases should not exceed the rate of population growth plus inflation. For the period under examination here, the state’s population increased at an annual rate of 1.38 percent, and the California Consumer Price Index rose an average of 2.99 percent a year. The combined total of 4.3811 percent a year is easily outpaced by the 5.37 percent average annual increase in General Fund spending.

California’s last three governors have not fared so well by this metric. Gov. Pete Wilson managed best, holding average annual spending increases to 4.88 percent, compared to population plus inflation growth of an average of 3.72 percent a year.

Under Gov. Gray Davis, spending rose an average of 6.73 percent a year versus population plus inflation growth of 4.83 percent.

Spending has grown slightly higher under Gov. Schwarzenegger

Whole thing, well worth a read, here.

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  • OP||

    Balance, shmalance. The Feds will cover our shortfall.

  • LarryA||

    The only spark of silver in this cloud is that Arnold can't (so far) be elected POTUS.

  • EJM||

    Albert Hammond has more on the subject, here. ;)

  • stuartl||

    Just a check on the math:

    Arnold's budget growth of 5.37 over a baseline of 4.38 equals 22.5% growth over the baseline.

    Wilson's budget growth of 4.88 over a baseline of 3.72 equals 31% growth over the baseline.

    Arnold does not look quite so bad (in comparison only -- 0% over is obviously best).

    Davis's growth rate over baseline of 39% is remarkably bad.

  • ||

    we have turned this crisis into an opportunity to make real, lasting reforms for Californians

    Is it just me, or is this an utterly preposterous assertion?

  • ||

    Heard an interesting tidbit on the radio driving home yesterday:

    Namely, CA is probably foregoing around $40B/year in revenue to the state government by prohibiting offshore drilling and oil and gas production on state-owned lands.

    Talk about self-inflicted wounds.

  • Alan Vanneman||

    Doesn't this suggest that California voters 1) hate taxes 2) love to spend, spend, spend? Maybe it isn't the governors who are so bad, or the legislators. Maybe it's the voters.

  • ||

    What? All of this government isn't free? Who knew?

  • ||

    My theory is that leftists get more hystical under Republican leaders, who are largely cowards in the face of shrill activist groups, cause they have their media lapdog ready to manufacture some kind scandel always at hand.

    By contrast, Democratic leaders get kid glove treatment by the media and the shrill activists seem to assume that all is well and forget the weekly protests. i.e. Homelessness doesn't really exist under Democratic governments, or it's being taken care of. Blinkered partisanship basically makes them willing to overlook all the social and economic "injustices" that they would be freaking out over if a Republican was in charge.

    That's pretty much how Clinton got away with deregulating telecom and balancing the budget.
    All was well. Nothing to protest here. Move along.

  • ||

    Being a Californian, this depresses me to no end. Aside from the specifics of the budget, the thing that infuriates me most is the ballot-box budgeting that we seem to kill ourselves with on an on-going basis. Voters consider ballot measures essentially in a vacuum, with little to no idea how the items they vote for impact the overall budget of the state. In the last election, when it was fully apparent that the state was approaching fiscal disaster, voters approved (among other things): $10B for a new high speed rail b/w SF and LA, $1B for children's hospital and $1B for veteran's relief. I love both children and veterans, but the state has NO MONEY!

    I saw this process described as the equivalent of an army's soldiers being able to override the general, mid-battle, with a show of hands. Insanity. BTW, this in no way implies that I think the "generals" have any clue either....

  • ||

    Being a Californian, this depresses me to no end.

    As a federal taxpayer, it depresses me no end as well, because I know that the Obama/Pelosi/Reid regime will be taking my money as a resident of Texas and giving to to California to finance their utter, feckless, stupidity.

  • Pamplemousse||

    See? This is what happens when you have a Republican leader who believes in the ideology of deregulation and free markets. They spend spend spend us into a hole!

  • Orange Line Special||

    Meanwhile, what Reason won't discuss is the billion dollar subsidy they support. That even made it into the LAT, but Reason will still handwave that subsidy away.

    P.S. Glenn Reynolds/Instapundit is promoting the Kochtopus: pajamasmedia.com/instapundit/70327
    Why does it seem like Reason waits for Glenn to give clearance on something before they'll cover it?

  • ||

    See? This is what happens when you have a Republican leader who believes in the ideology of deregulation and free markets. They spend spend spend us into a hole!


    I hate the way all this deregulation and laissez-faire capitalism keeps taking a bite out of my wallet.

  • Bingo||

    Is the invocation of "the Kochtopus" 1 drinks or 2 and does LoneDipshit have a multiplier effect?

  • AL||

    Population growth is not a good benchmark to measure government spending against. Not all people are equally productive, and if California, by its stupid policies, attracts all sorts of nonproductive people and dispels the productive, population growth does not translate to growth in GDP. If that's the case, then keeping spending in line will still not avert an eventual catastrophe.

  • ||

    Alan and MattM have it right. The ballot measure system for spending is a complete failure in my view. I overheard one voter in line at the polls talking on his cell phone explain that he was going to vote for the rail line measure, "because they are gonna tax us anyway, we might as well pick something good."

  • iowan||

    Time to expel California from the union.

  • Paul||

    cell phone explain that he was going to vote for the rail line measure, "because they are gonna tax us anyway, we might as well pick something good."

    Yeah... democracy sucks. If we could just get the right people in charge...

  • Paul||

    Time to expel California from the union.

    California wouldn't leave. They need the Union. You know, to help make budget.

  • ||

    It was Abel Maldonado who finally blinked. I know Abel, and he's a good guy. But his reputation as a hard line conservative just came to an end. He did manage to get some concessions out of the Democrats in return for his vote, but that doesn't alter the fact that he voted for higher taxes. Getting the controller to return his new furniture tickles me, but it ain't worth the price.

    Why do principles always get abandoned during a crisis, the very time we need them most?

  • stoneymonster||

    Yeah! Fuck California! Good thing no other states are as completely screwed up. I'm sure Val Kilmer will save New Mexico too.

  • ||

    Is the invocation of "the Kochtopus" 1 drinks or 2 and does LoneDipshit have a multiplier effect?

    Kochtopus is 1 drink and LoneDouchebag's multiplier effect is way to high for alcohol, being infinite and all.

  • ||

    Population growth is not a good benchmark to measure government spending against...California, by its stupid policies, attracts all sorts of nonproductive people and dispels the productive

    That is true here in Florida too but I don't consider it a reasonable excuse. The marginal costs of most government services are not linear. There should be economies of scale on most public services. Emphasis on should be.

  • ||

    That's pretty much how Clinton got away with deregulating telecom and balancing the budget.
    All was well. Nothing to protest here. Move along.



    Sure, it's a fine theoretical argument. But what happens when the Democratic President and Congress isn't interested in pushing such policies (and using the media compliance and Republican opposition as cover)? As bad as GWB was, getting a Democratic Congress didn't help, and President Obama surely isn't helping either. Our first $1 trillion deficit (on books, counting Social Security surplus) might be our first $2 trillion deficit, if any more mortgage and TARP aid is promised.

    Considering that Clinton had a Republican Congress for those actions, I think that divided government still seems to come out on top.

  • ||

    Our first $1 trillion deficit (on books, counting Social Security surplus) might be our first $2 trillion deficit, if any more mortgage and TARP aid is promised.

    Obama/Pelosi/Reid are already putting together Stimulus II, so I think that is nearly guaranteed, absent a truly historic taxpayer revolt.

  • ||

    Considering that Clinton had a Republican Congress for those actions, I think that divided government still seems to come out on top.

    Yeah, when the Republicans only control congress they stay in opposition mode, which means putting the brakes on spending and regulation. While the statist fanatics are placated by having a "strong leader" who is on their side.

    Fortunately, congress has a lot more actual power over economic issues. Having a Democratic president is better for civil liberties, too, cause his real power is things like the justice department and the supreme court.

    Democrat President/Republican congress is a good combination.

  • ||

    Having a Democratic president is better for civil liberties, too,

    I think that remains to be seen. Not ruling it out, but I have seen precious little evidence for it.

  • Andy||

    I know that the Obama/Pelosi/Reid regime will be taking my money as a resident of Texas and giving to to California to finance their utter, feckless, stupidity.

    While I agree with the feckless stupidity part, California has been the largest tax donor state for at least since 1981, so no non-Californian should be complaining about the drain CA is on the Fed budget, unless they're prepared to return all the money CA has contributed.

  • ||

    so no non-Californian should be complaining about the drain CA is on the Fed budget,

    The difference, of course, is that when I, as a resident of Texas, subsidize the CA state government, I am getting exactly nothing for this.

    When the federal government spends money in another state, presumably it is getting something for it, and (indirectly) so am I.

    Non-residents of California should not pay one red cent to support the State of California. That is very different from saying every state should have all of its federal tax money returned to it (somehow).

  • ||

    It was Abel Maldonado who finally blinked. I know Abel, and he's a good guy. But his reputation as a hard line conservative just came to an end. He did manage to get some concessions out of the Democrats in return for his vote, but that doesn't alter the fact that he voted for higher taxes. Getting the controller to return his new furniture tickles me, but it ain't worth the price.

    Those were pathetically weak concessions. That trade he did was very unequal, and he got the short end of the deal.

  • The Wine Commonsewer (you can ||

    California now spends 140 times as much money as it did the year I was born. Is there anything else on earth that costs 140 times more than it did? Do you make 140 times as much as your father? Does a movie ticket cost 140 times as much as it did, say, in 1960? Is your house worth 140 times what it sold for in 1948?

    Oh, and Abel Maldonado? Fuck him and the horse he came to town on.

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