White House says no to California budget help

[Monoriu]

  I know I will raise hell if I'm not paid fully.

And risk being sent to Outer Mongolia?

There are many, many insults and unfair practices and hellish conditions that can be endured.  Not being paid is NOT one of them.  Yes, I will raise hell if I am not paid.  You won't get an ounce of work done until you pay. 

[DontSayBanana]

There are many, many insults and unfair practices and hellish conditions that can be endured.  Not being paid is NOT one of them.  Yes, I will raise hell if I am not paid.  You won't get an ounce of work done until you pay.

Has been tried. Has failed. How does the company generate revenue if nobody's working? You just kill the company that much faster.

[Valmy]

http://money.cnn.com/news/storysupplement/economy/gapmap/index.htm

3.5 Billion?  Well we're boned.  Our legislature will NEVER raise taxes so I guess our already struggling public sector is going to continue to decline.

[Savonarola]

At 2.4 Billion Michigan's isn't so bad; but this is our third straight year of budget crisis.  We now have to cut state police and highway funding. 

[Neil]

In Pennsylvania, state workers will receive only partial pay on July 17 and July 24, after which paychecks will be withheld entirely until the impasse is solved. They will then be paid retroactively.

I'm surprised.  It would be illegal for employers not to pay salary owed within 7 days of pay day in Hong Kong.  I know I will raise hell if I'm not paid fully.

Yeah, but when you're employed by the government, and the government doesn't have any money, what are you going to do?

In the end, you'll take whatever you're given, because you're too afraid that they'll fire you and bring in some college grad in your place.

[Neil]

At 2.4 Billion Michigan's isn't so bad; but this is our third straight year of budget crisis.  We now have to cut state police and highway funding.

Why not just demolish all the highways leading into Detroit?  Save some money like that.

[MadImmortalMan]

THE CALIFORNIA FIX
The Golden State isn't worth it
Our high-benefit/high-tax model no longer works, especially compared with low-tax states like Texas.
By William Voegeli

November 1, 2009




In America's federal system, some states, such as California, offer residents a "package deal" that bundles numerous and ambitious public benefits with the high taxes needed to pay for them. Other states, such as Texas, offer packages combining modest benefits and low taxes. These alternatives, of course, define the basic argument between liberals and conservatives over what it means to get the size and scope of government right.

It's not surprising, then, that there's an intense debate over which model is more admirable and sustainable. What is surprising is the growing evidence that the low-benefit/low-tax package not only succeeds on its own terms but also according to the criteria used to defend its opposite. In other words, the superior public goods that supposedly justify the high taxes just aren't being delivered.

California and Texas are not perfect representatives of the alternative deals, but they come close. Overall, the Census Bureau's latest data show that state and local government expenditures for all purposes in 2005-06 were 46.8% higher in California than in Texas: $10,070 per person compared with $6,858. Only three states and the District of Columbia saw higher per capita government outlays than California, while those expenditures in Texas were lower than in all but seven states. California ranked 10th in overall taxes levied by state and local governments, on a per capita basis, while Texas, one of only seven states with no individual income tax, was 38th.

One way to assess how Americans feel about the different tax and benefit packages the states offer is by examining internal U.S. migration patterns. Between April 1, 2000, and June 30, 2007, an average of 3,247 more people moved out of California than into it every week, according to the Census Bureau. Over the same period, Texas had a net weekly population increase of 1,544 as a result of people moving in from other states. During these years, more generally, 16 of the 17 states with the lowest tax levels had positive "net internal migration," in the Census Bureau's language, while 14 of the 17 states with the highest taxes had negative net internal migration.

These folks pulling up stakes and driving U-Haul trucks across state lines understand a reality the defenders of the high-benefit/high-tax model must confront: All things being equal, everyone would rather pay low taxes than high ones. The high-benefit/high-tax model can work only if things are demonstrably not equal -- if the public goods purchased by the high taxes far surpass the quality, quantity and impact of those available to people who live in states with low taxes.

Today's public benefits fail that test, as urban scholar Joel Kotkin of NewGeography.com and Chapman University told the Los Angeles Times in March: "Twenty years ago, you could go to Texas, where they had very low taxes, and you would see the difference between there and California. Today, you go to Texas, the roads are no worse, the public schools are not great but are better than or equal to ours, and their universities are good. The bargain between California's government and the middle class is constantly being renegotiated to the disadvantage of the middle class."

These judgments are not based on drive-by sociology. According to a report issued earlier this year by the consulting firm McKinsey & Co., Texas students "are, on average, one to two years of learning ahead of California students of the same age," even though per-pupil expenditures on public school students are 12% higher in California. The details of the Census Bureau data show that Texas not only spends its citizens' dollars more effectively than California but emphasizes priorities that are more broadly beneficial. Per capita spending on transportation was 5.9% lower in California, and highway expenditures in particular were 9.5% lower, a discovery both plausible and infuriating to any Los Angeles commuter losing the will to live while sitting in yet another freeway traffic jam.

In what respects, then, does California "excel"? California's state and local government employees were the best compensated in America, according to the Census Bureau data for 2006. And the latest posting on the website of the California Foundation for Fiscal Responsibility shows 9,223 former civil servants and educators receiving pensions worth more than $100,000 a year from California's public retirement funds. The "dues" paid by taxpayers in order to belong to Club California purchase benefits that, increasingly, are enjoyed by the staff instead of the members.

None of this happens by accident. California's interlocking directorate of government employee unions, issue activists, careerists and campaign contributors has become increasingly aggressive and adept at using rhetoric extolling public benefits for all to deliver targeted advantages to itself. As a result, the political reality of the high-benefit/high-tax model is that its public goods are, increasingly, neither public nor good. Instead, the beneficiaries are the providers of the public services, and certain favored or connected constituencies, rather than the general population.

The recession will eventually end, and California's finances will get better. Given its powerful systemic bias against efficient and effective public services, however, the question is whether the state will ever get well. California's public sector has pinned its hopes for avoiding fundamental reform on increased federal aid to replace dollars the state's fed-up taxpayers refuse to surrender. In other words, residents in the other 49 states -- the new 49ers? -- would enjoy the privilege of paying California's taxes. Their one consolation will be not having to endure its lousy public services.

If, on the other hand, America's taxpayers (and China's bond buyers) succumb to bailout fatigue, California may reach the point at which, after every alternative has been exhausted, it is forced to try governing itself competently. You wouldn't know it from putting up with California's transportation and educational systems, but there actually is a principled, plausible argument to be made for the high-benefit/high-tax model. For the sake of both California and their own political ideals, its advocates ought to be leading the charge against every excess and inefficiency that deprives taxpayers of good value for their dollars. That won't happen until they stand up to their coalition partners by breaking their Faustian political bargain with California's self-serving governmental-industrial complex.

A lot of generalizations in there, and some stupidity too. I think the points about the effectiveness of the spending are right on, though. Texas has the best highways in the nation in my experience. And the state employees in Cali have a ridiculous racket going. Does that invalidate the idea that providing more services with higher taxes is doomed to failure? Of course not. It means it's doomed to failure without sufficient safeguards against abuse and corruption.

FWIW, My impression is that New York State has some of the best schools in the country, despite being California-lite. When I moved from Rochester to Ohio between 6th and 7th grade, the stuff I was taught was two years behind where I had been.

[Admiral Yi]

Doesn't necessarily invalidate it, no.  But you can't change the facts that Americans move pretty easily, and that the poor will be attracted to high benefit states and the rich will be repelled from high tax states. 

[Neil]

FWIW, My impression is that New York State has some of the best schools in the country, despite being California-lite. When I moved from Rochester to Ohio between 6th and 7th grade, the stuff I was taught was two years behind where I had been.

It's tremendously difficult to have quality education where evangelical Christianity predominates.

[Razgovory]

Doesn't necessarily invalidate it, no.  But you can't change the facts that Americans move pretty easily, and that the poor will be attracted to high benefit states and the rich will be repelled from high tax states.

Does that actually happen?  I've never heard of anyone moving out to California because it has higher benefits for the poor.

[Neil]

Doesn't necessarily invalidate it, no.  But you can't change the facts that Americans move pretty easily, and that the poor will be attracted to high benefit states and the rich will be repelled from high tax states.

Does that actually happen?  I've never heard of anyone moving out to California because it has higher benefits for the poor.

See:  Mexicans.

[Razgovory]

They also move to Texas.