Archive for the ‘California’ Category

California budget crisis could bring lasting economic harm

May 23, 2009
The short-term pain of budget cuts could pale next to a long-term loss of companies and academic talent.
By Martin Zimmerman, Marc Lifsher and Andrea Chang
Los Angeles Times
May 23, 2009

As bad as California’s budget crisis is for the state’s $1.8-trillion economy, just wait. It could get worse.

The spectacle that played out in the national media this week of a state unable to get its fiscal act together is reinforcing the notion that the Golden State is a rotten place to do business, experts say.
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Corporate leaders and Wall Street investors, watching the daily festival of seeming incompetence, political partisanship and governmental dysfunction, could be persuaded to limit or eliminate their investments here.

“We lose competitive advantage by being the state that can’t solve its problems,” economist Stephen Levy said. “Regardless of what we think the solution is, the fact is we can’t find a solution.”

The budget crisis threatens to further weaken the state’s job market, which lost 63,700 more jobs last month, according to figures released Friday. The state’s overall unemployment rate actually fell slightly, to 11% from 11.2%. But new job losses could prolong the vicious cycle in which the California economy is now trapped, with rising joblessness reducing consumer spending and delaying a housing rebound, thus leading to more layoffs.

Read the rest:
http://www.latimes.com/business/la-f
i-cal-econ23-2009may23,0,1242793.story

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What California, Pelosi, Waxman, Feinstein and Schwarzenegger Can’t Ignore: Except They’ve Already Proven Stupidity

May 22, 2009

How could California’s politicians turn the land of milk and honey into a candidate for bankruptcy or bailout?

By ignoring industry and wealth creation — just like Barack Obama is now doing on the national level.

So bad decision making jumps to mind.

The only growing “industry” in California is government; followed by health care.  And maybe health care is numero uno, to use the Californian language.

Since he became Governor, Arnold Schwarzenegger’s California has added 50,000 new state employees.  These are highly paid people with full medical care.  It’s kind of a welfare for the white collar.  And what wealth do they add to the state?  You do the math: no products produced, no industry of reality.  But they do tax, collect fees and make laws which contributes to a hemorrhage of wealth producing businesses to Nevada and other locales.
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Sen. Dianne Feinstein said development of solar and wind facilities in California’s Mojave Desert would violate the spirit of what conservationists had intended when they donated much of the land to the public.

My Vietnamese born wife and I drove through the Mojave not long ago and she said, “Worthless burnt rock.”

And that is what it will reamain if Feinstein gets her way.

California’s Congressman Henry Waxman, primary sponsor of the radical cap&trade/national eco-tax bill in the House, like Feinsten and a lot of other Californians, is willing to destroy real wealth producing industry with cap and trade while ignoring something literally beneath California’s feet: oil.

Related:
Wind, Solar Produce only 1% of Electric Needs; Need “Comprehensive Energy Plan”

Last September the San Franciso Chronicle reported this gem:

“Pelosi is holding firm to her view that more drilling won’t have any short-term impact on gas prices and would only lower prices by pennies a gallon 10 years from now, citing government figures. She’s plotting a vote on a bill to rein in speculators in energy markets when Congress returns next month.  Pelosi and other top Democrats see little reason to compromise. They expect to pick up seats in the House and Senate in November – and perhaps the White House, too – which would allow them to craft a more environmentally friendly energy policy next year. In the meantime, they plan to use their fundraising advantage to bash GOP candidates with ads linking them to oil companies.”

So for the short term, gas prices are fine so why drill — that’s what Pelosi said.  And besides, according the Pelosi’s logic, she could get more Democrats elected and obtain a more environmentally friendly energy policy.The problem now is short term and it may become long term (certainly it has already on the national level).  The problem is debt, borrowing, and no creating of wealth.

So screw wealth producing.

You can’t pay health care workers and government workers without someone creating wealth.

California has a shortage of people who create wealth: Hollywood just can’t keep up.

Yesterday, Nancy Pelosi, who has never said anything rediculously stupid, called climate change “the greatest challenge of our day.”  She said climate change is a national security, economic, environmental health and moral issue.

Here’s a national security challenge: China owns most of the American debt and will just watch us spend ourselves out of the superpower seat.  But we’ll be greener than China!  Congratulations.

Related:
China says rich nations must cut emissions by 40%; offers no Chinese cuts

California  has a pack of politicians that are thinking green and thinking us into more debt.  They had better think green like green money soon or they’ll be out of both.

They are currently working on how to slash expenses and con the Federal Government out of a bailout.  Nowhere have we heard about planning to create more wealth.

Green, gay and gutless.  We could pray for more wealth producing businesses but the state has chased them off — and prayer is frowned upon.

http://michellemalkin.com/2009/05/21/
waxman-clueless-about-his-captrade-bi
ll-youre-asking-me/

Related:

Obama Hasn’t Noticed People Leaving California and New York?

Obama, Pelosi, Waxman, Feinstein and Schwarzenegger: demonize wealth, oil, big business and prayer.  But love green, big government, government health care and debt spending.  Can this work?

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Brilliant Michael Moore Attacks Those that Produce Wealth

LOS ANGELES (Reuters) – Firebrand filmmaker Michael Moore, who targeted the Bush administration in “Fahrenheit 9/11” and the healthcare industry in “Sicko,” is now focusing on the global economic meltdown.

The Oscar-winning director will release his as-yet-untitled documentary across North America on October 2, co-financiers Overture Films and Paramount Vantage said on Thursday.

“The wealthy, at some point, decided they didn’t have enough wealth,” the statement quoted Moore as saying.

“They wanted more — a lot more. So they systematically set about to fleece the American people out of their hard-earned money. Now, why would they do this? That is what I seek to discover in this movie.”

Overture said Moore was still working on the film, and was keeping plot details close to his vest in typical fashion.

Liberty Media Corp-owned Overture will handle the film’s domestic release both in theaters and ancillary outlets, while Viacom Inc-owned Paramount Vantage will handle international sales.

Read the rest:
http://www.reuters.com/article/entertainmentNews/idUST
RE54K68I20090521?feedType=RSS&feedName=enter
tainmentNews&rpc=22&sp=true

Pelosi Calls Global Warming “Greatest Challenge”
http://www.washingtonpost.com/wp-dyn/co
ntent/article/2009/05/21/AR20090521040
52.html?wprss=rss_metro

California’s a Democratic State. ACORN Got Handouts; Where’s Ours?

May 22, 2009
ACORN and SEIU are loyal pawns of the Democratic money grabbig maching.  They have gotten a lot of benefit for their loyalty.  Now you can’t blame California for asking, “Where’s our bailout?”

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Democrats are pushing for federal loan guarantees while Republicans are opposed, leaving Congress’ largest delegation with little power to persuade the White House to come to the state’s rescue.

By Richard Simon
L.A. Times
May 22, 2009

Reporting from Washington — California has by far the largest delegation in Congress, almost 10% of the membership. Nancy Pelosi, the speaker of the House, is a Californian, as are five of its committees’ chairs — a collection of powerful positions unmatched by any state. The state’s two senators chair important committees, and one holds a coveted seat on the Appropriations Committee.

And in terms of electoral politics, California has been among the most reliably Democratic major states, as well as by far the party’s most generous source of campaign cash.

Read the rest:
http://www.latimes.com/news/local/
la-me-delegation22-2009may22,0,3548195.story

California Idea to Borrow Like Obama would only shift trouble to the future and set a “dangerous precedent” budget analysts says

May 21, 2009

The governor’s proposal for $5.5 billion in short-term borrowing would only shift trouble to the future and set a “dangerous precedent,” a top budget analysts said today.

Governor Arnold Schwarzenegger’s plan to sell $6 billion in revenue anticipation warrants to raise cash for the state government as it faces a $21.3 billion budget gap, the state’s budget watchdog office said on Thursday.

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From The L.A. Times

Declaring that California faces thorny choices to avoid insolvency, the state Legislative Analyst said that Gov. Arnold Schwarzenegger’s plan to borrow and sell off key assets to help overcome a $21.3-billion deficit won’t work.

Updated at 11:38 a.m.: New estimates of revenue suggest the budget deficit may be as much as $3 billion larger than the governor estimated.

In a 28-page report released this morning, Legislative Analyst Mac Taylor said the governor’s proposal for $5.5 billion in short-term borrowing would only shift trouble to the future and set a “dangerous precedent.”

Taylor’s report also expresses doubts about the proposed $1-billion sale of a state-owned workers’ compensation insurance program and a plan to save $750 million on the state’s costly Medi-Cal program by potentially cutting healthcare reimbursements or slashing the number of eligible participants.

But the report says several of the governor’s budget proposal “merit serious consideration,” including eliminating some state boards, selling property and changing retirement health benefits for future state employees.

Taylor also emphasized a need for the Legislature to “make the difficult decisions” and act quickly, which would “likely boost the confidence of the public and investors in the budget process” as well as prevent an anticipated cash crush in early July.

— Eric Bailey in Sacramento

Warning to Obama in California Vote

May 21, 2009
California voters sent one heckuva message Tuesday, as they unceremoniously shot down attempts by Gov. Arnold Schwarzenegger and state legislative leaders of both parties to raise their taxes, again. The politicos wanted the additional revenues to cover their $44 billion worth of over-spending, aka the state budget deficit. Voters said no, decisively, with majorities of 60 percent or more against the five tax-and-spend propositions, including a $16 billion “temporary” tax increase approved in April by Schwarzenegger and the legislature. In what cannot be an encouraging sign for advocates in Washington of President Obama’s massive spending increases (and the inevitable tax hikes that will be required to pay for them), the only one of the six initiatives California voters approved was a cap on the salaries of elected officials.
 
All of this came despite endlessly repeated warnings from the same public officials who got California into its present mess that, if the public voted no, their only alternative would be draconian cuts to education and public safety. According to the Tax Foundation, officials in Sacramento have been on a wild spending spree since 2000, the last time California’s budget was balanced without borrowing or resorting to one-time accounting gimmicks. Between 2003 (when Schwarzenegger took office) and 2007, state spending ballooned 31 percent – far beyond inflation (12 percent) and population growth (5 percent). Californians have seen this train wreck coming for many months.

Had the main initiatives passed, it would have imposed additional taxes in a state that already has the sixth highest tax burden in the nation without addressing the real problem, which is the explosive growth of state government.

Editorial
The Washington Examiner

read the rest:

http://www.washingtonexaminer.com/opin
ion/Warning-to-Obama-in-California-vote-45517617.html

The Coming California Bailout

May 21, 2009

Yesterday we wrote that it was difficut often in today’s political debate to get the truth because the media sides with the left.  Most of the media, that is.  In California, the L.A. Times and Sacramento Bee are blaming the voters for the budget chaos.  But The Orange County Register seems to have a handle on what’s going on and warns us to get ready to bail out California (then maybe New York, New Jersey,….).

It’s not the voters who are to blame, stupid……

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California, the sunny incubator of America’s future, has relished its role as a leading indicator of political trends. Tuesday it became what it thinks it should be, the center of attention, but not in the way it wants to be.

By George Will
The Washington Post

Its voters, at last sensible, rejected, by an average of 65 percent, five of six propositions. Gov. Arnold Schwarzenegger, the “post-partisan” Republican, and the partisan Democrats who control the legislature, promoted the propositions as efficient for and essential to eliminating the state’s budget deficit, which will now be $21 billion. So California may become the next target for the Obama administration, whose dependency agenda involves seizing every opportunity to break things — banks, insurance and automobile companies, etc. — to the saddle of its supervision.

The Orange County Register — if but one newspaper survives today’s leveling winds, may it be this one — made the case for rejecting all six propositions: 1A would have created an illusory spending cap that could be “easily circumvented by raising taxes” — and the ballot language did not mention that 1A would have meant a $16 billion, two-year extension of some of February’s huge tax increases. Proposition 1B promised the public school lobby $9 billion, effectively bribing it to support 1A, which the California Teachers Association did. Proposition 1C combined “two of the worst practices responsible for” the state’s dysfunction, “rosy revenue projections and borrowing”: It would have authorized borrowing from (hypothetical) increases in state lottery revenue. Proposition 1D, “one more hide-the-pea fiscal deception,” would have transferred to the general fund — and much of it on to public employees — revenue raised for children’s programs. Proposition 1E would have done the same for revenue raised for mental health services.
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California Governor Arnold Schwarzenegger speaks to the media ...
Photo: Reuters

Proposition 1F, passed by 73.9 percent, denies pay raises to legislators when the budget is not balanced. The Register opposed this because it gives legislators “a personal, financial incentive” to balance the budget by raising taxes.

Now California’s mostly Democratic political class will petition Washington for a bailout to nourish the public sector that is suffocating the state’s dwindling — and departing — private sector. The Obama administration, which rewarded the United Auto Workers by giving it considerable control over two companies it helped reduce to commercial rubble, will serve the interests of California’s unionized public employees and others largely responsible for reducing the state to mendicancy.

These factions will flourish if the state becomes a federal poodle on a short leash held by the president. He might make aid conditional on the state doing things that California Democrats and their union allies would love to be “compelled” to do: eliminate the requirements of two-thirds majorities of both houses of the legislature to raise taxes and pass budgets, and repeal Proposition 13, which voters passed in 1978 to limit property taxes. These changes would enable the legislature (job approval rating: 14 percent) to siphon away an ever-larger share of taxpayers’ wealth and transfer it to public employees. Such as prison guards, whose potent union is one reason California’s cost-per-inmate (about $49,000) is twice the national average.

California’s voters are complicit in their state’s collapse. They elect and reelect the legislators off whom public employees unions batten. Also, voters have promiscuously used their state’s plebiscitary devices to control and fatten the budget. In November, as the dark fiscal clouds lowered, they authorized $9.95 billion more in debt as a down payment on a perhaps $75 billion high-speed-rail project linking San Francisco and Los Angeles — a delight California cannot afford.

The greenback may be headed for a tumble as intense selling is underway.In a surreal attempt to terrify voters into supporting the propositions, Schwarzenegger (job approval: 33 percent) threatened to do something sensible: sell such state assets as San Quentin prison, which sits on prime ocean-view real estate. But Californians should now pay a real price, in realism about ways and means, for Schwarzenegger’s wasted years. His governance-by-attention-deficit-disorder has involved flitting from one trendy irrelevance (e.g., stem-cell research) to another (e.g., cooling the planet) while the state has sagged. Fittingly, he was in Washington as his shambolic legacy was being defined by Tuesday’s defeat.

 

He was at the White House, applauding the Obama administration’s imposition of severe fuel efficiency standards on a dependent automobile industry that at least has a proven aptitude for its new task of building cars Americans will not like. Standing far from Tuesday’s repudiation, in the shadow of the president who may soon effectively be California’s governor, Schwarzenegger was the administration’s dependency agenda writ small.

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Democrats all snug and smug in their majority in Congress had better be paying attention because what happened out here yesterday is coming to their congressional districts very soon. Tax increases + out of control spending + incompetent politicians + an angry electorate = the electoral gallows for incumbents.

–Patrick Dorinson, Political communications strategist and commentator.

Related:
http://michellemalkin.com/2009/05
/21/what-the-sacramento-bee-real
ly-thinks-of-voters/

Watch For Next “Bailout” Idea To Come From California…..

May 20, 2009

“California Gov. Arnold Schwarzenegger, alarmed by the ongoing national financial crisis, warned Treasury Secretary Henry M. Paulson on Thursday that the state might need an emergency loan of as much as $7 billion from the federal government within weeks.  The warning comes as California is close to running out of cash to fund day-to-day government operations and is unable to access routine short-term loans that it typically relies on to remain solvent.”
http://ac360.blogs.cnn.com/2008
/10/03/california-bailout/

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That was last October 3, 2008.  So what does any thinking American believe about a bailout of California now that the state’s  voters have refused to pay more?

(A)  Arnold Schwarzenegger will ask Obama for a bailout.  California is too big to fail.

and

(B) The rest of us shouldn’t have to pay more.  No Fed Bailout for California.

The problem is, like an addict needing drugs, many are crying for a bailout after AIG, the banks, the entire auto industry and a bunch of others got fed at the trough.  Geithner has turned into drug dealer of first choice.

It might not be “permanent.”  Just an addiction….

“We are committed to helping California in these difficult economic times,” an Obama administration official said today. The official was not authorized to speak publicly….

The Obama Administration also caved in on its threat to withhold stimulus money from California…..

The L.A. Times reported that a letter that was given to the governor this morning, the U.S. Department of Health and Human Services said the state remains eligible to receive another $8 billion in stimulus money for its Medicaid program, a ruling that may offer some solace for state officials coping with the resounding voter defeat Tuesday of five ballot measures aimed at closing California’s huge budget shortfall.

Note “some solace”= $8 billion….

http://michellemalkin.com/2009/
05/20/bailoutmania-not-permanent-just-forever/

Obama Hasn’t Noticed People Leaving California and New York?

May 20, 2009

Taxes, fees, too much regulation, and a “hostile business environment” are reasons cited by people leaving California and New York.

Much of the media covering this story has a liberal bias so ground truth is difficult to find.

But here is a snip from the Orange County (CA) Register last April:

Attendees heard from more than a dozen businesspeople who complained of high workman’s compensation insurance, “predatory” regulators, an unfriendly business climate, a “never ending paper trail of business forms,” exorbitant utility expenses, fees, taxes, quality of life and overpriced overhead.

Randy York said he moved his polyurethane manufacturing business from Huntington Beach to Reno, Nev. in 1987 because he was tired of being “hammered” with regulatory fees from the fire department, the health department, the state Environmental Protection Agency, the California Division of Occupational Safety and Health and the South Coast Air Quality Management District.

He said it got to the point where he was paying $2,000 or $3,000 a quarter on fees – for company of 20 employees.

            “They were killing us with fees,” he said. “Fees, fees, fees.”

See:
http://www.ocregister.com/articles/ca
lifornia-business-fees-2375002-nevada-company

Pollster Pat Goodall says 3,000 people leave California every week: mostly because of taxes and fees.

In New York, the situation is similar.

Some economists say high income New Yorkers are leaving the state faster than those fleeing California.  At least in California, one has the Pacific Ocean…..

Here’s what Donald Trump told Neil Cavuto in April:

“The fact is that the state of New York did something very, very foolish, and they passed a tax, an income tax, and increased it very substantially from what it was.And I believe that’s going to be a total disaster for the state. …You’re talking about millions and millions of dollars for some people that really have other options, Neil. They can move to other states. You take a state like Florida, run by a governor, Charlie Crist, who is a terrific governor, and who is very, very cherishing of his no income tax.So, you know, I make a lot of money outside of New York State, as an example. And I’m saying to myself, wait a minute. For the privilege of living in New York, I am supposed to pay tens of millions of dollars in extra taxes? It doesn’t make sense.”

http://www.foxnews.com/story/0,2933,513027,00.html
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At the national level, Obama seems unknowing or uncaring.  His proposal to cut “loopholes” for businesses operating on foreign shores and in “tax havens” ignores the natural fact of economics (and life) that businesses will migrate toward the places that offer the best bottom line….People too…..

http://michellemalkin.com/2009/0
5/20/billionaire-to-new-york-screw-you/

Related:
Calif, NY, NJ: Highest Taxes But “Fiscal Basket Cases;” People Moving Out

 

Donald Trump holds a driver. He’s building his golf course in Scotland where it isn’t as expensive….as New York….Photo: AP

California Voters Reject Taxes, Spending, Big Government — Bluest State is Red in The Face

May 20, 2009

California is arguably the bluest of the blue states — the most liberal of all the 50 states.

But news from Na-Na Land today: the state’s voters reject more taxes, more spending and more bad government.

Voters said yesterday: guess what?  We can’t have it all because we can’t afford it.

California voters soundly rejected a package of ballot measures Tuesday that would have reduced the state’s projected budget deficit of $21.3 billion to something slightly less overwhelming: $15.4 billion.
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Three thousand people are leaving California every week: many seeking lower taxes.

“Go West Young Man” has turned into “go back east or go back where we came from.”

The voters of California seemed to join the Tea Party Revolt on Tuesday.

Washington should take note….

Michelle Malkin:
http://michellemalkin.com/2009/05/
20/california-to-tax-and-spenders-n
o-no-no-no-and-hell-no/

California: Why Liberal Media is Failing
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Calif Voters Order Govt Pay Cuts; No New Taxes, Gov Starts Slashing Budget, Services

California: Why Liberal Media is Failing

May 20, 2009

NBC and MSNBC are struggling to find views and the New York Times is considering bankruptcy or sale.

Liberal media is failing and it isn’t hard to see why.

Yesterday, California’s voters rejected tax hikes to solve a budget shortfall.  Voters rejected all of the State House’s plans except to order limits to state pay checks.

Drastic, draconian measures are on the table: even bankruptcy.

Has the liberal media covered this extensively?

If the economy imploded and voters rejected all new taxes in Spain, Italy, or Russia: would that be in the top news?  You bet.  Even though those nations’ have a GDP about the same as California’s, the State of Governor Arnold Schwarzenegger just experienced a real tea party; and the liberal media wants to ignore it…..Just as it has tried to do for months….

Americans want to know what is going on.  They don’t want to know what Barack found to be enchanting any more….

Related:
Limbaugh Says, Without Him as Piñata, MSNBC Ratings Will Plummet
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Obama Loving NBC Called “Titanic” Of TV Networks
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NYT Never Heard of ACORN or Pelosi’s CIA Dispute or Plagiarism….
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White House Works To Bury Pelosi-CIA Story, New York Times Complies
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http://michellemalkin.com/2009/05/19/c
alifornia-the-poster-child-for-dysfunction/