Los Angeles, 2009: California may be the eighth largest economy in the world, but its state staff are being paid in IOUs, unemployment is at its highest in 70 years, and teachers are on hunger strike. So what has gone so catastrophically wrong?
[...] Yet California is currently cutting healthcare, slashing the “Healthy Families” programme that helped an estimated one million of its poorest children. Los Angeles now has a poverty rate of 20%. Other cities across the state, such as Fresno and Modesto, have jobless rates that rival Detroit’s.
[...] “I believe in California. It pains me at the moment to see it where it is, but I still believe in it,” said Michael Levine.
Are the representatives in Sacramento being paid with IOU’s from the State?
The IOUs are worthless per the SEC. Propositions in the state require a super majority of the legislature to pass tax increases, and a small minority of “No New Taxes” pledged Reps are standing in the way of fixing things.
The other problem you have in CA is massive corruption at the state level in the form on pork barrel projects, no bid contracts, and special tax breaks to businesses. Even as the state is selling and leasing back every government building it can, the sales are going to “friends of the legislature”.
Sounds like California has re-discovered, just as Europe periodically re-discovers, Socialism doesn’t work.
California, great state, wacky politicians.
PS. Any of those $130K fireman’s jobs available with pensions of $120K a year? Hmmm, work 3 days a week…..
This is what happens when people become overly dependent on the govt. for all their needs. They lose their incentive to educate their selves and to work for a living. All these wonderful, caring, feel good programs sound nice but they destroy the spirit. It wasn’t long ago you either worked hard and educated yourself or you died. Today we make it easy to sit on your rear and do nothing and big govt. will provide for you. Well big govt. is now bankrupt as a result. The rest of the country is right behind California. The only way to stop it is to go back to tough love. You either get off your rear, get an education and work or you get nothing from the govt., zero. Unfortunately, it probably won’t happen, that would be considered as being “mean spirited” and “racist”. So California here we come!
Always figured New Mexico was in worse shape than California has been. They have the worst unemployment and poverty rates in the country, what what I understand. Perhaps I better move?
#4, ron,
This is what happens when people become overly dependent on the govt. for all their needs.
No, this is what happens when you allow a small number of politicians to block legislation until they get their way.
If California was allowed to legislate as almost every other State then this impasse wouldn’t be happening.
I was in CA last week on a short use-it-or-loose-it vacation. I had never been there before and wanted to stick my toes in the ocean. A few observations:
1) Absolutely the worst traffic I’ve ever seen.
Fry’s Electronics… wow!
2) Always standing in line. I’ve been to NYC, and the lines there are worse, but it’s fairly easy to strike up a conversation with the other folks waiting. Not the case in CA, they’re either shouting to someone on a cell phone or too cool/afraid/whatever to talk to someone.
3) The waiters and waitresses are all incredible salespeople, offering tons of advice on food, but when it arrives, it’s late and cold. Oh, and when most of the food in the country is produced down the road, using local ingredients isn’t all that impressive.
3a) But In-and-out Burger is great, and needs to expand eastward.
4) SF is a very pretty city, what I saw of it. I think the only way to get an idea of what it has to offer is to have a guided tour from a resident (maybe John and Adam can offer a food tour of SF area for $500… it would be better than an evening in Vegas).
5) The PCH really is a great drive.
6) What the hell’s with all the warning signs? While on the trail hiking up to the Golden Gate Bridge, I saw a sign warning of poison oak, less than a foot from the trail. Just pull the darn weed out! The hotel bar had a warning sign on the door about alcohol causing problems, like the warnings on cigarettes. Every 100 feet or so there’s a sign warning us of something on the highways.
7) I stopped at a rest stop, one of the few that was open. Like in most states, the rest stop has information boards about the area. Every board was either about how precious the resources are, how CALTRANS is working hard to fix the roads (HAR!), or that the state is insuring that scenic land will be “saved” by the state somehow.
9) I drove down the 101 into Silicon Valley (to see the first Fry’s), and I understand why companies want to locate there. It looks like one giant prototyper’s playground. When you can get hardware produced just down the road instead of shipping back and forth, it can make things go so much faster.
10) I want to get the lens filter they use in Hollywood to cut through the smog and make it look like the sun is shining. (To be fair, that might have been smoke from fires)
11) I think if I lived there I’d need to make a lot more money than I do here in Colorado. I can see why politicians think they can spend forever, though. There’s a lot of wealth in this state.
12) Las Vegas makes sense to me now, and I actually enjoyed staying there on the last night of my trip.
Pictures from the trip will be up later on today:
http://flickr.com/photos/n3kqx
well let them have more tax cuts out there, as you know you can provide full services to all with a discounted tax rate…
yeah yeah that’s the ticket..
I stopped trucking to California some years back due to their inhumane treatment of those they consider undesirable workers. (not a politician,recipient of aid or entertainment worker) Look at how they treat the everyday working person and it becomes clear why the are in the position they are. For the 22 years I’ve seen a constant line of people moving in to and out of California, both groups looking for a better tomorrow and not finding it in the golden state
Why socialism doesn’t work in America:
No jobs = no collected taxes
no collected taxes = deficit spending
deficit spending = inflation
inflation = pissed off rich people
pissed off rich people = more off shoring of jobs
keep repeating…
Why do people think they should need to rely on the Government to live?
California is less than 50% white…. Hello people diversity destroys and kills everything including diversity. It used to be important for a country to have a dominate religion i.e. Spain catholic. Now not only no main religion but no main racial stock.
Means no cohesion. Ever hear of the tower of Babel?
How about controlling the salaries given out to public workers. Who else gets automatic pay raises? It’s over a hundred thousand per year when you include pensions.
ronwp54, yes its good to see a man who has gone to the trouble of educating “hisself”
I hate outdated articles like this. FYI CA is no longer paying in IOUs and hasn’t been for some time now.
And one of the many reasons CA is in the state it’s in is restriction on taxes (Prop 13). Rely too much on cap gains and sales tax, overheated real estate tanks and guess what, you’ve got 30% less $$ to meet your budgeting needs. That and the fact that it takes 2/3 majority to pass a budget and you get a small minority (Repub) with a controlling power to mess things up.
First thing we need to do is have ALL ballot initiatives re-approved or voted out on a regular basis. As of now we have no good mechanism for getting rid of bad ideas that were once thought good by the voters.
#15, As of now we have no good mechanism for getting rid of bad ideas that were once thought good by the voters.
Welcome to world of Mob Rule.
No, California’s problems are twofold. First, we’ve been peddling bonds for years and we spend many, many millions just maintaining them. Since Schwarzenegger came to power, he’s lived off of bond sales and these are all legally mandated payments that cannot be put off, cannot be done away with, etc. It’s like the national debt, which constitutes the single largest line item in the U.S. budget.
Secondly, the absurd union contracts that the state has signed on for over the years which, again, we’re legally stuck with. None of them can be reopened or renegotiated and we’re throwing away millions in retirement benefits that we simply cannot afford.
Add to that the fact that the California legislature never met a social program they didn’t like whether they could pay for it or not and you have a disaster. They have raised taxes, then they just increased spending to go along with it. It’s runaway spending on frivolous things that are absolutely unjustifiable.
We need to go bankrupt, there’s just no other way out of the corner we’ve painted ourselves into.
15 years of Republican governors, 5 years of Democratic governors.
20 years of a Democratic legislature +/- a few months when Willie Brown messed with them in 1995.
The public employee unions, spending on social programs and environmentalism is what killed CA.
California is a failed state because it embraced the Wall Street mentality of spend now, worry about the bills later.
Republican governors have always managed to trash California’s economy. Remember Pete Wilson’s great idea to do business with his buddies at Enron?