Brown’s State of the State: It’s Morning in California

Brown’s State of the State: It’s Morning in California

JerryBrownSchwPresident Ronald Reagan’s 1984 re-election campaign theme boasted: “It’s Morning in America.” He won 49 states, losing only rival Walter Mondale’s native Minnesota.

Gov. Jerry Brown’s State of the State address this morning kicked off a similar theme in what effectively was his re-election pitch. He didn’t imitate Reagan and say, exactly, “It’s Morning in California.” But the meaning still was there. The governor enthused:

“What a comeback it is. A million new jobs since 2010, a budgetary surplus in the billions and a minimum wage rising to $10 an hour! 

“This year, Californians have a lot to be proud of. For a decade, budget instability was the order of the day. A lethal combination of national recessions, improvident tax cuts and too much spending created a financial sink hole that defied every effort to climb out. But three years later, here we are – with state spending and revenues solidly balanced, and more to come.”

Of course things are better than when he took office three years ago to clean up the wreckage of the disastrous Schwarzenegger administration. But unemployment in California remains stubbornly high, at 8.5 percent, sixth worst in the country; and well above such rivals as Texas at 6.1 percent and Florida at 6.4 percent. Both those states lack a state income tax, compared to the hefty top California rate of 13.3 percent because of Brown’s Proposition 30 tax increase.

The increase in the minimum wage Brown touted also likely will kill jobs, making unemployment worse.

And a November study by the U.S. Census Bureau found that, when California’s sky-high cost of living was figured into calculations, the state suffered the country’s worst poverty rate.

Threats

Of course, if a politician simply says, “Life is wonderful,” then there’s no need to re-elect him. Anybody else could do the job.

So the politician has to bring up future threats that only he can vanquish. Brown:

“But we are not out of the woods and we certainly are not out of the drought. Life is uncertainty, the climate is changing – not for the better – and the business cycle and the stock market are historically volatile, with good years followed by bad, with painful regularity.”

“Better” on climate depends on where you live. California’s weather in recent weeks has been at its balmy best. But the Northeast of the country has been plunged into a new global cooling, probably due to the lack of sunspots.

Brown no doubt believes that “global warming”/climate change is occurring, bringing with it the continued need for imposing AB 32, the Global Warming Solutions Act of 2006.

But it’s also good politics. Brown knows that election victories ride on the backs of coalitions. An essential element of his coalition is environmentalists. He has offended some of them already by advancing fracking and loosening the California Environmental Quality Act to fight the drought. So continuing to advance the global-warming hypothesis and the policies to fight it keeps the enviros on his side.

Budget

Brown also knows his reputation for frugality sells with voters, including many Republicans. So even though he actually has increased spending more than 20 percent in three years, he maintained:

“And while we know our revenues will fluctuate up and down, our long-term liabilities are enormous and ever growing. Let me list some of them: Over $100 billion for pensions owed to state workers, teachers and judges; tens of billions needed to cover retiree health care; and $65 billion needed to maintain and keep our roads, buildings and other infrastructure in sound repair. We also must account for future risks that could negatively affect our budgets like congressional decisions, natural disasters and the uncertain costs of the Affordable Care Act.

“So we can’t go back to ‘business as usual.’ Boom and bust is our lot and we must follow the ancient advice, recounted in the Book of Genesis, that Joseph gave to the Pharaoh: Put away your surplus during the years of great plenty so you will be ready for the lean years which are sure to follow.”

You never know. And Brown, as an astute politician, will take nothing for granted. But the economy probably will remain strong enough in 2014 to keep him in the governor’s chair.

The problem comes when, as he warned, bad times return. There isn’t enough wiggle room in his proposed budget for fiscal 2014-15, which begins on July 1, to avoid massive new deficits during a recession. And the pension problems he warned about are not going away.

In short, the State of the State probably is good enough for Brown to stay in office, but the long-term problems still are not being dealt with adequately.

22 comments

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  1. LetitCollapse
    LetitCollapse 22 January, 2014, 13:00

    Bond guru Mohamed El-Erian just announced his resignation as CEO of Pimco. Young man. Only 55. Resigned for no apparent reason. Out of the blue. Calls to El-Erian and Pimco to ascertain a reason were not returned. lol.

    Bond king Bill Gross, 70 years old, said as late as 2012 that El-Erian was his heir apparent. lol.

    Bill assured investors that he’s not going anywhere. lol.

    Pimco is the largest private bond-fund holder in the world with over $2 trillion in assets under management.

    El-Erian is not a stupid man. lol. When he speaks, I listen. When Brown speaks I turn off the TV.

    Calm before the storm?

    Let the good times roll!!!

    Reply this comment
  2. billyBS
    billyBS 22 January, 2014, 15:40

    High Unemployment and coresponding poverty rate are good for the Governor’s poll rating along with the inability of the the Republicans to offer any solution that they could actually put in place. The legislature would not implement any economic/tax proposal without union approval, unless there were 500,000 “citizens” with pitchforks, axes, and ropes in front of the capital eager to implement change they believe in.
    That would be more likely with Republican proposals to cut the free stuff. change pensions, etc..What a visual, “purple shirted sow with a pitchfork”
    Expect more of the same, such as spending growth, increased taxes/fees.
    Thank God(Obama), Comrades.

    Reply this comment
    • LetitCollapse
      LetitCollapse 22 January, 2014, 19:01

      Yes, billy. California already has the highest poverty rate and the governor promotes policies that attracts even more poverty – like DL’s for illegals, no deportation unless an illegal commits a serious violent felony – there is even a bill in committee that would give ObamaCare to any illegal foreigner who lives in California. lol. IOW’s, if it gets approved, any illegal that makes his home in California gets free ROUTINE health care compliments of the California taxpayers. How nuts is that? No other nation on the planet would promote such an insane policy. Illegals would come from everywhere!!!

      And don’t let anyone tell you that he or she is a ‘fiscal conservative’ if they support illegals living in California, billy In LA County alone well over a billion dollars a year in taxpayer money is spent annually on illegals for healthcare, education, welfare (anchor baby moms) and incarcerations. And that doesn’t even count the child tax credits they get from the IRS ($4.2B nationwide in 2010). And this doesn’t even include all the financial damage done to individual US citizens in terms of having their jobs stolen, being victims of illegal immigrant crime, etc…. So it’s impossible to be a ‘fiscal conservative’ and be a supporter of illegal immigration. Impossible. They are fiscal liberals who simply won’t fess up.

      Oh, and think about this. The more poverty we have in California the more government workers we need to service the social needs of the poor. Right? Law enforcement must grow too since the large portion of crime is committed in the poor areas.

      Most Californians resent higher taxes. But lower taxes require eliminating the network of subsidies to millions of Californians that these taxes finance, and eliminating the jobs of government employees who administer them.

      But government LOVES poverty and they LOVE for you to pay for it through higher taxes, billy!!!

      HIGHER POVERTY RATES = HIGHER TAXES ON THE PRODUCERS!!!!

      Reply this comment
  3. Ulysses Uhaul
    Ulysses Uhaul 22 January, 2014, 20:46

    Collapso….go into the moat business…..Lucrative…….doomers need the security……

    Reply this comment
  4. Ulysses Uhaul
    Ulysses Uhaul 23 January, 2014, 08:40

    Whew! Teddy what to do……need some sympathy…..who is this guy?

    Reply this comment
  5. billyBS
    billyBS 23 January, 2014, 12:40

    Well, if Teddy did that, that would be one less thing thing for Ulysses to do.

    Reply this comment
  6. Ed the Independent Contractor
    Ed the Independent Contractor 23 January, 2014, 15:46

    Jerry Brown sounds like a guy wearing a tin foil hat and saying the sky is falling, but my tin foil hat will protect me. Immediate action needs to be taken in order to prevent the financial collapse of California. Jerry Brown will supervise the collapse while playing his violin a la the Roman Emperor Nero. What a deceptive report on the state of the California economy. Don’t forget, this “balanced budget” comes on the back of new taxes.

    Reply this comment
  7. Ulysses Uhaul
    Ulysses Uhaul 23 January, 2014, 19:02

    Teddy……not meat industry…..MOAT building industry…..the doomers need security to hide from poor people they fear for some reason or other.

    Reply this comment
    • Donkey
      Donkey 24 January, 2014, 04:22

      UU, you are clueless. This is not about class warfare, it is about state sponsored stealing by the RAGWUS, of which you are a part!! 🙂

      Reply this comment
  8. billybs
    billybs 23 January, 2014, 20:17

    The farmers generals will have a somber fate. Heads will roll. Their grandchildren will be carnitas. Justice(and sustenance) to the deserving. Comrades. It will be done. Do not cringe at the flesh of the connected, it is actually pretty good with Hot sauce.

    Reply this comment
  9. LetitCollapse
    LetitCollapse 23 January, 2014, 21:14

    See TS dish it out but unable to take it.

    See TS cry.

    Reply this comment
  10. LetitCollapse
    LetitCollapse 24 January, 2014, 11:42

    Waaaah! Waaaah! I waan my wah-wah!

    Reply this comment
  11. Rex the Wonder Dog!
    Rex the Wonder Dog! 26 January, 2014, 21:32

    You guys are so mean….poor Teddy took his ball and went home…you guys are too hard on him and his sock puppets. Lighten up on poor Teddy 😉

    Reply this comment
  12. Ted Steele, Manager
    Ted Steele, Manager 29 January, 2014, 11:22

    Poodle—- I’m here for ya Little Buddy– What do you need?

    Reply this comment

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