By Steven Greenhut

SACRAMENTO — Not many of my friends or neighbors are sitting on pins and needles, worrying that the world as we know it will end as the federal government “slashes” spending as part of the automatic sequester cuts mandated by a previous budget bill.

And not many people have been thinking, “Geesh, there’s nothing we need more than higher California taxes and additional directives from state legislators to help us live our lives in a better and healthier manner!”

Yet, the political class is acting as if its own crisis — i.e., some gentle restraints on its power to tax and spend — is the same as a real crisis in the lives of the people whom they govern. So officials are scaring us into submission. This game has gotten particularly ugly at the federal level, where the president and members of Congress have raised the specter of poisoned food and endangered troops to get us to acquiesce in their latest strategy scam for more dollars.

At the state level, legislators used similar tactics to convince voters to raise income taxes and sales taxes last November. But it seems as if it’s never enough. In the new legislative session, they continue to use hobgoblins — i.e., childhood obesity caused by sugary soda pop and the environmental calamity posed by single-use plastic grocery bags — to impose new fees and taxes that would fund programs on the backs of officially disapproved, although legal, behavior.

Media ignore vulgar posturing

Unfortunately, large segments of the media reliably champion these efforts, which also serves to keep many of the rest of us from behaving as any normal people should — by laughing out loud at the vulgarity of the posturing and by pointing out some fairly obvious facts.

For starters, we know how governments often spend money. We’ve watched as the Obama administration has thrown around hundreds of billions of so-called stimulus dollars that have enriched the politically well-connected without doing all that much for the economy. A good bit of that money has been lost or, perhaps, stolen; there are hundreds of ongoing investigations into potential stimulus-related fraud.

In California, Gov. Jerry Brown is pushing a high-speed-rail system that critics warn will end up costing $100 billion, or more, to basically replicate what Southwest Airlines already offers — quick travel within the state — using private dollars. We know that state officials refuse to reform government-employee pensions, often in the six figures, that have led to a half-trillion-dollar unfunded liability. We’re aware of the newest suspected boondoggle — a multibillion-dollar plan to change the direction of the Sacramento Delta water flow in order to save a few bait fish.

We know that the stated solution for chronic state budget deficits is predicated on something virtually impossible, that Democratic leaders suddenly embrace governmental austerity. As the Sacramento Bee reported this past week regarding the new legislative session, “Taxes, fees or other charges are proposed for soda pop and sweet tea drinkers, motorists, gun owners and people who frequent strip clubs, buy prepaid cellular phone minutes or use paper or plastic shopping bags. Businesses are targeted by proposals ranging from an oil severance tax to a manufacturers fee for mattress recycling and a crackdown on firms that avoid property tax reassessments after ownership changes.”

The truth about government spending

The amounts are much larger with the federal government. We have seen what it costs to maintain a military presence worthy of an empire. We are familiar with the salaries paid to federal workers and the soaring debt the government faces to pay for its “entitlement” promises. We know that government spending has long been on an upward trajectory regardless of what party putatively steers the Leviathan.

Yet, we’re supposed to believe that cutting a measly $85 billion from a $3.55 trillion budget — a mere 2.4 percent — is going to stretch the government so thin that it can’t even maintain tours to the White House and it might even endanger consumers by laying off meat inspectors.

Are those the best theatrics they can come up with?

This is the equivalent of a family that spends lavishly but then threatens to abandon its pets and starve the children when its trust fund investments don’t perform well enough one year. You know that, the moment new funds come in, they’ll be back vacationing in Maui and buying big-screen TVs.

A crisis designed to inflame the masses

To forestall any potential panic, Congress last week was working on legislation that keeps meat inspectors on the job and also was “giving government managers flexibility to minimize the impacts on the public by finding the savings elsewhere in their budgets,” according to a McClatchy report. That bill reinforces reality. This is a manufactured crisis designed to upset the masses. Really — we need congressional legislation to legalize common sense in public agencies?

The truth is seeping out. The conservative Heritage Foundation reported, “Federal spending is projected to grow from $3.6 trillion in 2013 to more than $6 trillion by 2023, a 69 percent increase without sequestration. Even with sequestration, federal spending would still grow by 67 percent. Sequestration barely even slows the growth in spending, let alone cuts any spending out of the overall budget.”

Somehow, the nation will survive, even if the federal government doesn’t grow as rapidly as planned, and California might get by without a bullet train or higher taxes on nude dancing. As usual, the first step in controlling government’s endless appetite is to call its bluff and refuse to give in to predictable and, at times, laughable, scare tactics.

Steven Greenhut is vice president of journalism at the Franklin Center for Government and Public Integrity. Write him at steven.greenhut@franklincenterhq.org.

By Katy Grimes

Sequestration is the word of the month. Prior to the federal government threatening Draconian cuts to food assistance programs and the Head Start program, most people had never heard of the word, which refers to the automatic cuts to federal spending that began on March 1.

Together with much of the media, the Obama administration’s sequestration warnings have been dire. “Devastating automatic cuts are taking effect if Congress doesn’t act, slashing vital services for children, seniors, the mentally ill, and our men and women in uniform,” the White House warned.

Actually, these sequestration cuts are merely cuts in increased government spending, not real budget cuts. According to a new report from the California Senate Office of Research, there are a number of programs exempted from sequester cuts, including:

* Child nutrition (school lunch program)
* Federal-aid highway programs
* Medicaid (Medi-Cal)
* Children’s Health Insurance Program (Healthy Families)
* Military salaries
* Pell grants
* Social Security benefits
* Supplemental Nutrition Assistance Program (CalFresh, formerly known as food stamps)
* Supplemental Security Income
* Temporary Assistance for Needy Families (CalWORKs)
* Veterans’ benefits and health care

Senate Office of Research

And nowhere in the Senate report does it address what the “cuts” really are — cuts of $44 billion in federal spending growth. Federal spending still will go up 1.4 percent next year, instead of 1.6 percent without sequestration. So there really is no overall cut.

“Many of the spending cuts Obama is calling for are actually revenue increases, like the $140 billion in ‘reduced payments to drug companies,’ which actually means the drug companies will be paying back rebates to the government,” the National Center for Policy Analysis found. “The plan includes similar savings in unemployment insurance and postal service reforms but a large portion of these savings comes from new fees.”

California warnings

The California state Senate report did not affirmatively define what will be cut. Instead, the Senate office reported lots of “coulds”:

By Katy Grimes

SACRAMENTO — Yesterday in the California Assembly the Democratic majority played fast and loose with a bipartisan bill aimed at urging President Barack Obama and Congress to avert the federal sequestration cuts.

SJR 3, by state Sen. Steve Knight, R-Antelope Valley, was passed unanimously by the California Senate on Monday. But in the Assembly, SJR 3 was no longer on the table, and a more partisan version was put in its place.

I asked Knight what happened. “It was a purely political move,” he said. “We even had Democrat support,” for his Senate bill.

Knight explained he was contacted late Wednesday by Assembly leaders and told he could author a severely amended version of his bill, in the form of AJR 14, or kiss it goodbye. Knight said while there were similarities, the Assembly version contained many inaccuracies and incorrect information, as well as a tax-increase component lacking in the version passed by the Senate.

“I made sure my bill was bipartisan, and we know that taxes make it a very partisan bill,” Knight said.

The ramming through of AJR 14 by Assemblywoman Toni Atkins, D-San Diego, circumvented the legal bill process. It was introduced less than 24 hours ago when Knight refused to accept the text of AJR 14 as amendments to his SJR 3.

Skipping the bill process

Knight’s bill, SJR 3, was already vetted, and had been heard publicly in committee hearings. But AJR 14, the replacement bill, had not been vetted or heard in any committee.

“Forcing me to decide between agreeing to inflammatory language or killing my original measure is an assault to my ethics and character,” Knight said.

Knight wasn’t alone. Many Republicans were incensed by the political hijinks. “God help us,” Assemblywoman Shannon Grove, R-Bakersfield, said. “I really thought this wasn’t going to start until June. It’s the end of February.”

“Stay off this bill,” Assemblyman Curt Hagman, R-Chino, urged Republicans. “No one had a chance to even read this bill.” AJR 14 was delivered to Assembly members this morning, after being printed overnight.

Freshman Assemblyman Scott Will, R-Valencia, urged all of the Assembly freshman class to withhold a vote on the bill to send a message to Assembly leadership that the rules need to be followed.

Unlike Knight’s SJR 3, the Assembly resolution suggests that raising taxes is a necessary prerequisite for avoiding sequester cuts. That line is being advanced “even though taxes already were raised by $620 billion earlier this year,” Knight said.

But comparing SJR 3 and AJR 14 side by side, the discrepancies and differences become obvious. Knight said that, while SJR 3 sought to unite legislators of both parties in a careful and thoughtful manner, AJR 14 was intentionally written to be divisive and prevent bipartisan dialogue on an issue important to California.

Knight said some of the information presented as “fact” in AJR 14 was highly suspect, and he rhetorically asked where Assembly Democrats got their information.

The Senate Rules Committee analysis reported:

* “The impact of a $1.2 trillion across-the-board, forced federal spending cuts proposed under sequestration will have serious and deleterious effects on our local, regional, state, and national economies, and jeopardize hundreds of thousands of high-wage, high-skill aerospace and other defense-related jobs, nondefense jobs, and critical social service programs in education, housing, health care, and other human service programs throughout the nation.

* “The sequestration spending cuts to over 1,000 government programs would shrink defense and nondefense discretionary spending and be devastating to the California and national economies.

* “Due to our unique combination of geography, cutting edge technological industries, and manufacturing capabilities, California is second in the United States for federal defense spending and provides vital services to our brave men and women serving in uniform around the world, and a cut to the defense budget would dramatically reduce the provision of those services and risk the safety of our troops.

* “Over 2.14 million jobs are projected to be lost in the United States, including 225,464 jobs lost in California, if the sequestration cuts are triggered.

* “An estimated $215 billion reduction in the nation’s gross domestic product, including an almost $23 billion reduction in California’s gross state product are projected, if the sequestration cuts are triggered.

* “A long-term, bipartisan compromise that averts sequestration will protect the California and national economies and provide a balanced and thoughtful budget solution.”

Threats of cuts vary

According to the White House, California-specific cuts will include:

* $87.6 million in funding for primary and secondary education.

* $12.4 million in environmental funding.

* $399.4 million reduction in gross pay through furlough of 64,000 civilian Department of Defense employees.

* $1.6 million in Justice Assistance Grants that support law enforcement.

* $3.3 million in funding for job search assistance, referral and placement.

* $2.6 million in public health funding.

* $5.4 million in funds that provide meals for seniors.

The sequester would severely impact California’s 29 military installations, which are home to 117,806 active military personnel, 57,792 Reserve and National Guard personnel and 61,365 civilian personnel. Total: 236,963.

“I stand by my decision to ask Congress to go back to the drawing board and to come up with another solution to avoid devastating cuts caused by sequestration,” Knight said. “My version was supported on the [state] Senate Floor by Senators on both sides of the aisle who often disagree. Unfortunately a petty decision was made to guarantee that my version would not move forward.”

By Chriss Street

Over the weekend, the White House released a report detailing some of the programs and services in California that would be impacted beginning on March 1.  The Obama Administration has threatened that the cuts will result in a massive contraction of the national economy.

The breakdown of the effects on California was politically structured as an emotional call for Republicans to commit hara-kiri by compromising the demands of their base for fiscal discipline.  With sequester only amounting to 2 percent of spending, the cuts do not seem to be as earth shattering as the media has predicted.   

Sequester is defined as the act of removing, separating or seizing anything from the possession of its owner under the process of law for the benefit of creditors or the state. The term “budget sequestration” was first used to describe a section of Gramm-Rudman-Hollings Deficit Reduction Act of 1985 under President Ronald Reagan. It set hard caps on spending.

The sequestration was abandoned under President George H.W. Bush and replaced by a required PAYGO under the Budget Enforcement Act of 1990 that lasted until 2002, when President George W. Bush abandoned budget discipline.

California will suffer the following cuts, according to the Obama Administration:

Teachers and Schools:  Loss of approximately $87.6 million in funding for primary and secondary education, equivalent to the cost of 1,210 of the 310,000 teachers in the state.  In addition, California also will lose approximately $62.9 million in funds for about 760 special education teachers, aides and staff who help children with disabilities.

Work-Study Jobs: Approximately 9,600 fewer low-income students in California would receive aid to help them finance the costs of college and around 3,690 would lose federal grants for work-study jobs that help them pay for college.

Head Start: Head Start and Early Head Start services would be eliminated for approximately 8,200 children in California.

Funding for Clean Air and Water: California would lose about $12.4 million in environmental funding for clean water and air quality.  In addition, it may lose another $1.9 million in grants for fish and wildlife protection.

Military Readiness: Approximately 64,000 civilian Department of Defense employees would be furloughed, reducing gross pay by around $399.4 million.  Army base operation funding would be cut by about $54 million.  Air Force operation funding would decrease by about $15 million.  Navy maintenance to repair five ships in San Diego and aircraft depot maintenance in North Island could be delayed or canceled.

Funds for Law Enforcement and Public Safety: California would lose about $1.6 million in Justice Assistance Grants for law enforcement, prosecution and courts, crime prevention and education, corrections and community corrections, drug treatment and enforcement and crime victim and witness initiatives.

Job-Search Assistance: California would lose about $3.3 million in funding for job search assistance, referral and placement.

Child Care: Up to 2,000 children deemed disadvantaged and vulnerable could lose access to child care.

Vaccines for Children: Around 15,810 fewer children would receive vaccines for diseases such as measles, mumps, rubella, tetanus, whooping cough, influenza and Hepatitis B due to reduced funding for vaccinations of about $1.1 million.

Public Health: California would lose approximately $2.6 million in funds to help upgrade its ability to respond to public health threats including infectious diseases, natural disasters and biological, chemical, nuclear and radiological events.  In addition, California would lose about $12.4 million in grants to help prevent and treat substance abuse.  The California State Department of Health Services would lose about $2 million that would have paid for 49,300 HIV tests.

STOP Violence Against Women Program: California could lose up to $795,000 in funds that provide services to victims of domestic violence.

Nutrition Assistance for Seniors: California would lose approximately $5.4 million in funds that provide meals for seniors.

I do not want to understate that any cuts to a group of Californians receiving federal benefits will be painful.  But in my recent report, California Admits Higher Taxes Kill Tax Collection, the Not-So-Golden-State is proving that raising taxes to pay for deficit spending destroys economic growth and results in lower tax collection.

Even with the sequester, the Congressional Budget Office projects that over his eight years in office, President Obama will have engaged in $7.5 trillion in deficit spending and the national debt will have almost doubled.  The burden of this federal debt will be painful to all Californians.

CHRISS STREET & PAUL PRESTON
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