We're All Obstacles to Reform

Jan. 18, 2010

Technically speaking, it’s not hard to figure out how to solve California’s permanent fiscal crisis – if one neglects the political mountains that would have to be moved to implement the fixes. A few good starting points: imposing a strict spending limit on legislators, reducing pension benefits for newly hired public employees, cutting back on the regulations that squelch business expansion and reducing government restrictions on water use so that the agricultural industry can flourish again

But good luck with any of that without taking on the most powerful interests in the state and dealing with the deep-seated political attitudes that have led to the current morass. Knowing what to do is one thing, but putting together a plan that might work is another. My task today is identifying the main obstacles to success. They might be obvious, but it’s best to clearly identify any problem before attempting to fix it, as any psychologist would tell you. Given that Sacramento is a glorified loony bin, this isn’t the worst analogy to use.

Look for the union label. You may have read my rants (and maybe you’ve even read my latest book on this subject) about how unions control this state and have used their clout to amass outrageous salaries and pension benefits that are difficult to believe and impossible to sustain. They’ve also built up special protections that have made it impossible for legislators to reform public services. Consider how difficult it is to fire incompetent teachers thanks to the muscle of the California Teachers Association. This has resulted in debt, unfunded liabilities and poorly provided public services. But don’t believe me. Listen to former Assembly speaker Willie Brown, the dean of California liberalism, who wrote these words in a recent San Francisco Chronicle column:

“The deal used to be that civil servants were paid less than private sector workers in exchange for an understanding that they had job security for life. But we politicians – pushed by our friends in labor – gradually expanded pay and benefits . . . while keeping the job protections and layering on incredibly generous retirement packages. . . . This is politically unpopular and potentially even career suicide . . . but at some point, someone is going to have to get honest about the fact.”

The time for honesty is now – or else forget about reform.

Democratic “regressives.” Another core obstacle to reform is what author Joel Kotkin calls Democratic “regressives” – so-called liberals or progressives who are mainly interested in protecting their quality of life by knocking various rungs off the economic ladder for the state’s working class and growing minority communities. He refers to the wealthy liberal elites who live predominantly in high-end coastal communities who fight economic growth, impose absurd restrictions on land use and whose excessive environmental sensibilities are regulating businesses out of existence.

Writes Kotkin, “California’s high-tech greens may talk a liberal streak in terms of diversity and social justice, but their prescriptions offer little for those who would like to build a career and raise a family in 21st century California. Their policies in terms of land use regulation and greenhouse gas emissions will make it even harder for existing factories, warehouses, home builders and other traditional employers of the middle- or working class.”

Given that the Democratic union constituency is part of a predominantly public-sector union movement (private-sector unions are problematic, but support construction and economic growth), there are few voices within the state’s most dominant party pushing for pro-growth policies. It is those policies that provide jobs and opportunity for the lower- and middle-classes. This political dynamic and “we got ours” mindset routinely blocks economic reform.

Republican ineffectiveness. As a minority party in the Capitol, California’s Republicans can only do so much. But between the moderates who are always cutting deals with Democrats, the current Republican administration, which is downright schizophrenic (one day it talks about serious reforms, then the next day it proposes new regulations), and conservatives who seem to prefer fighting divisive social issues than dealing with economic reform, it’s hard to consider the GOP a solution to anything and it often is an obstacle to reform. That’s especially true when one considers that Republicans often have supported some of the costliest expansions in government thanks to their blind law-and-order philosophy. Note the growth in the prison budget and in the cost of pensions for public safety officials and the inability to achieve substantial common-sense drug-law reform.

Nonsensical voters. It’s hard to blame “voters” for anything in particular given that the mass of voting Californians is so large that it’s silly to try to discern what this group is saying at any given time. But at some point it’s fair to look at ourselves when we consider the mess this state has become. Someone put these self-seeking, government-expanding charlatans into office. A wise voting populace might have, say, elected Tom McClintock as governor rather than Arnold Schwarzenegger during its historic chance to pull back from the brink. We all know that a large group of voters voted for Arnold because he is a really cool movie actor.

California also has the most advanced – if advanced is the right word for it – form of direct democracy in the country, if not the world. How many California voters bemoan the state’s ongoing fiscal emergency yet supported multibillion-dollar bond proposals and budget-box-balloting measures that have helped cause the current crisis? I know people who on one hand oppose tax increases yet at the same time cry and scream when tuition goes up a slight amount and who believe all the sky-is-falling nonsense about severe cutbacks in programs?

For the record, I oppose all tax increases, because the government bandits don’t deserve any more of our hard-earned money, but running up debt simply is another form of a tax increase. We need to keep taxes low and keep government small, but California voters seem to want to keep taxes low and let government get even bigger than it already is. Something has to give.

I understand the economic concept of rational ignorance. It doesn’t pay for any voter in particular to learn much about candidates and issues because that person’s one vote can’t possibly change the outcome of an election. But surely it’s rational for people to start paying a little more attention to the process given that real-world results of uncontrolled government spending and regulating.

So, yes, in a sense we’re all obstacles to reform in California. Until union power is broken, Democratic dominance is diminished, Republicans get a backbone and voters learn how to say no, we’re in trouble. I wish I could be more encouraging, but it is going to take a paradigm shift — or an even bigger budget crisis — to save us.

— Steven Greenhut