Cooling off on the Mendocino Coast! Next post July 26, 2010.
The problem the Gov and the Dems have is that this bond does nothing to address the water supply problem; it’s just another porkulus bill. Californians are finally waking up to the realities of government bond spending: it isn’t free money!!
By John Howard at Capitol Weekly, July 15, 2010
The political fight to get an $11.1 billion water bond on California’s Nov. 2 ballot was tough. The fight to get it off the same ballot may be tough, too.
The same forces – and some new ones – are in play again: Environmentalists vs. business interests, Delta protectionists vs. farmers, Northern California vs. Southern California, Republicans vs. Democrats, construction workers vs. conservationists. An underlying tension pits the demands of environmentalists to protect the Sacramento-San Joaquin River Delta and block new reservoirs against the building of new dams and the movement of more water to the Central Valley and Southern California.
Many pro-environment Democrats and pro-dam Republicans voted for the bond in a compromise culminating months of negotiations. Many expended political capital in supporting the patchwork proposal. Will they face heat now in voting to delay or change it?
“They had to bite hard on certain things. I know I did,” said Assemblyman Jim Nielsen, R-Gerber.
Assemblyman Jared Huffman, D-San Rafael, agreed. “There was a very tough set of issues. There were many legislators, myself included, who voted for this very reluctantly as part of a series of important compromises.”
The governor and three of the four top legislative leaders – two in the Senate and one in the Assembly – generally favor taking the bond off the ballot and delaying it until 2012, citing a weak economy and fears that voters won’t support billions of dollars in new borrowing. The odd man out – so far, at least – is Speaker John Perez, who says he wants to think about it. As private discussions intensify, a key issue is Perez’s position and how that might play into other major issues – the state budget, for example – as the Legislature heads toward recess.
Options include delaying the bond until November 2012, leaving it on the ballot this year, renegotiating the scope of the bond and shifting the lineup of projects, cutting the dollar amount, or scrapping the whole thing and starting over from square one. The latter is favored by many in the environmental community, who see the bond as a collection of pork projects.
“The right thing to do is remove it entirely and redo it at a much lower amount. Water projects that only benefit a small number of people need to disappear,” said Paul Tebble of Friends of the River, adding that dams also were a critical issue. “Philosophically,” he added, “it is really difficult for us to accept Temperance Flat (a proposed dam near Fresno).”
The governor and a number of key allies, including agriculture, some water agencies and an economic coalition, favor the delay. Economic conditions aren’t ripe for the bond now, and to lose at the ballot box would make it much more difficult to negotiate a new package, they argue. Also, money that could be tapped for an aggressive pro-bond campaign is being consumed in the high-stakes races for governor and U.S. Senate. And while the bond is supported by the public in early polling, ballot measures that authorize public borrowing tend to wither as Election Day nears.
“We’re the ones who sat down with the governor and reviewed what the options are,” said Jim Earp of the Alliance for Jobs, a coalition of contractors and construction workers. The group has been an advocate for infrastructure improvements.
“After discussion with the governor and legislative leadership, it was kind of the consensus, given the contentious political climate over the budget and a lot of other political issues floating around this November, to wait until the message on the water bond could be heard by voters,” he said.
Ultimately, lawmakers in both houses believe the bond will be postponed – as Gov. Schwarzenegger has urged – but before that happens it may become entangled in the frenzied, 11th-hour negotiations that mark legislative sessions. Pushing the bond to 2012 requires approval from two-thirds of the members in each house. In the final floor votes last year, it emerged from the Senate in a 28-8 vote and from the Assembly, 55-20. In both houses, the measure had a single vote more than the two-thirds majority needed for passage.
“It was a complex, difficult package to negotiate,” said Timothy Quinn of the Association of California Water Agencies, which supports the water bond. “Coming back to renegotiate parts of the package – that’s not a good idea. I think they’ll get it done, but it may be a big fight. It was a big issue, a big compromise, and it needs to be held together.”
Earp agreed. “It’s a nonstarter, when you consider that it took three years of hard work to get that legislation put together, you don’t go back after the fact and cherry pick it and change it.”
The $11.14 billion bond, Proposition 18 on the November ballot authored by former Senate GOP Leader Dave Cogdill, R-Fresno, provides financing for an array of projects, including dams, drought relief, recycling, habitat restoration, groundwater improvements, watershed restoration, infrastructure improvements, and the like. The mix of capitol projects sought by agriculture and many water districts, plus conservation and restoration projects sought by environmentalists fueled the ultimate compromise that allowed the package to emerge from the Legislature.
But environmentalists, and their allies in the Legislature whose districts flank the delta, were not pleased at what they believed was a lack of protection for the heart of the state’s water system. The bond may die if it goes before voters in the current, harsh economic climate – and that might be a good thing.
“I think it should be repealed and revised, and let the new governor and Legislature consider it,” said Sen. Lois Wolk, D-Davis, a long-time opponent of the original package. “The first question to ask is, ‘What is the purpose of this bond? If it is the restoration of the health of the delta, then we ought to focus on those projects that reduce the reliance of Southern California and the Bay Area on the delta. My feeling is there should be a narrowed bond, and we should combine that with the $4.1 billion in bonds that were authorized but not sold from Proposition 1E.”
“Going forward with the same bond in 2012,” she added, “may not be wise. The circumstances aren’t right now, and will be even less so in 2012.”
Sierra Club California’s Jim Metropulos agreed. “We’ll have a new governor and a new Legislature. This governor and this Legislature should not tie the hands of the future governor and Legislature with a bad deal.”
But the farm community, which played an important role in the talks that led to the bond measure, favored keeping the package in tact and pushing it 2012.
“We’re disappointed that the vote may be delayed, but we understand why,” said Paul Wenger, president of the California Farm Bureau Federation. “There are many good water improvements in the bond, including funding for new surface storage, but there may be a need to take more time to inform voters…”
Gil Dominguez’s heartfelt essay below is important for we Central Valley Republicans. We’re going to have to figure out what we’re going to DO about illegal immigration, not just how we FEEL about it.
By Gil Dominguez at American Thinker, July 13, 2010
Because I am a Latino, most people automatically assume that I am either a liberal or a Democrat, or both. In fact, I am one of those rare creatures: a conservative Hispanic. The unfortunate truth is that the majority of Latinos in my hometown of San Antonio and elsewhere are Democrats, even though they may not share all of the national party’s social views or vote in every election. About the only Latino group that is an exception are the Cubans.
Party identification is an inherited family trait, passed down from generation to generation. My wife and I, however, have broken the chain, much to the dismay and even animosity of our respective families. I once told my younger sister that I was leaning more toward the Republican Party, and she responded mockingly: "Where do you get that from?" as if I had contracted a contagious disease. She was dismissive of my views despite the fact that she has a high school diploma and I have a master’s in government.
But my sister, like many other Latinos, has always identified strongly with the Democratic Party, which is more of an emotional bond than an intellectual one. I remember as a kid hearing some of the older folks speaking fondly of "el viejito" Roosevelt — old man Roosevelt — only they pronounced his name "Rosabell." In some homes, decorative plates with the visage of JFK painted on them were proudly displayed on walls or cupboards. In other homes, a photo of the late president sat atop a home altar, next to a statue of the Virgin of Guadalupe. More than once I have heard a Latino declare that he or she is "a Catholic and a Democrat" — an incongruous marrying of the sacred and the profane. The implication is that they are no more likely to change religion than party affiliation.
My late father-in-law, a blue-collar union member, was a socially conservative family man, although that didn’t stop him from voting for candidate Bill Clinton. There, of course, had been questions about Clinton’s veracity and questionable moral judgment — including possible drug use, draft-dodging, and philandering — but those things weren’t as important as the fact that Clinton was a Democrat.
Later, my father-in-law, a World War II-era veteran, complained to me that now-President Clinton wanted to allow homosexuals to serve in the military. That had been a Clinton campaign promise all along, but suddenly it was a revelation to my father-in-law. It was clear that he had not listened to what Clinton was saying during the campaign because he was going to vote for him anyway.
Many Latinos still hold to the old paradigm of Republicans as rich, old, racist white men. The ironic reality in Texas and the rest of the once-solid South is that it was the Democratic Party that was full of rich, old, racist white men. When I was a child, my dad told me about a great banquet where President Eisenhower was being feted, and when some poor and hungry people wandered into the place and began begging for food, they were heartlessly and unceremoniously thrown out. I don’t know where my father heard that fable or if he believed it, but he passed it along to me.
I grew up in a working-class family on the San Antonio West Side, a solidly Democratic and Mexican-American area. Later, as a young college freshman just out of the Army and back from Vietnam, I fancied myself a socialist and was even more left-wing than most of the professors at the small liberal arts university I attended.
At school, I got caught up in the campus culture. I went to antiwar demonstrations, voted for George McGovern in my first presidential election, and held the obligatory liberal/left animosity toward corporations, the war, the military, capitalism, conservative politics as personified by Nixon and the Republicans, and anything else to my right.
But after graduating from college and finally going to work full-time in the civilian world, cracks began to appear in my once-impenetrable left-wing thinking, mainly because I saw cracks in the liberal/left philosophy. I recall that Eldridge Cleaver, formerly of the 1960s Black Panthers, had turned into a conservative. He had been an honest guy, after all, who could face the truth about himself and what he had once believed. He had been wrong, and communism was wrong, but he had to find that out for himself.
Those people I knew who were on the extreme left had nothing good at all to say about the United States — not only about the government, but also the American people. In my experience, though, I knew Americans were always the most generous of any nation, sparing neither blood nor treasure when it came to helping other people in need, either at home or abroad.
I once attended a meeting of the Socialist Workers Party. There were no real workers there, unless you count students on work-study. The speaker talked about the criminal things we were doing to the Vietnamese people. But having been to Vietnam, I knew firsthand what the truth was. Yes, there was the terrible My Lai incident, but that was an isolated event and not based on any military policy. On the other hand, it was the common practice of the Vietcong to torture and kill villagers who refused to support them or let them take their young men away to fight.
My fellow leftists, blinded by their ideology, refused to see the great contributions our country has made to world civilization, from the arts to science. Just a few years before, Americans had gone to the moon. They couldn’t see how free markets had made life better for everyone, that a free enterprise system is integral to a free society.
Without exception, every leftist I met was smug, self-righteous, and condescending. In their minds, only the unschooled and unsophisticated loved the country the way it was. They failed to see their own weaknesses, could not or would not critically examine their own ideas, and were intolerant of those who did.
Being a Latino conservative has not been easy. I have learned to hold my opinion among family, friends, and colleagues — otherwise, I would be constantly fighting with people I love and care about. I’m selective about the battles I feel I need to fight, and I find that I’m usually a lot more informed and knowledgeable about things than are my opponents. I have to be because I’m using facts and reason, not just emotion, in my arguments.
At times, I’ll see old high school and college classmates or people I knew while growing up. Their thinking hasn’t changed at all, hasn’t budged from where it was years ago. They maintain the old animosities against Republicans and conservatives without really knowing why — mostly based on old myths and prejudices, although they claim to be the ones who are unbiased and open-minded. They have not grown up intellectually, but I think I have. And I feel I’m the better for it.
From Calbuzz, July 12, 2010
Buried in last week’s Field Poll were some nifty data that confirm something Calbuzz has been arguing for quite a while: that California’s pioneering climate-change law, and now Prop. 23 which seeks to suspend it, is a key political marker in the governor’s race and in the Senate race as well.
The Field Poll found Jerry Brown and Meg Whitman in a statistical tie – 44% for Brown and 43% for Whitman. When a political contest is tied, analysts like to find variables that demonstrate powerful — significant — differences.
Party registration is always one of the most muscular variables. About 74% of Democrats are supporting Brown, for example, and about 80% of Republicans are supporting Whitman.
The Field Poll also found that Prop. 23, the measure to suspend AB32’s requirement to rollback the level of greenhouse gases in California, is running behind, with 48% of the voters opposed and 36% in favor – generally regarded as a weak starting point for a ballot measure.*
But a separate crosstab that the Field Poll ran at our request showed that voters who favor Prop. 23 are supporting Whitman over Brown by 55-34% while those who oppose the measure are supporting Brown by 54-34% — virtual mirror images.
At the same time, and even more impressive: Whitman voters are supporting Prop. 23 by 45-36% but Brown supporters are opposing the measure by an even stronger 60-28%. These are differences you can call statistically significant.
Some, but not all of this is the effect of party registration, since Democrats oppose Prop. 23 by 57-31% and Republicans support it 47-33%. But it’s also clear that there’s some powerful correlation going on between opposition to overturning AB32 and who voters are supporting in the governor’s race.
It’s important, too, that independents – who are supporting Whitman over Brown by just 42-39% — also are opposed to Prop. 23 by 53-29%. If Brown makes those independents aware that Whitman has called for a suspension of the state’s climate-change law, it could create a problem for Whitman among this important group of voters.
There’s a strong connection between Prop. 23 and the Senate race, too.
Fiorina voters favor Prop. 23 by 47-34% while Boxer voters are opposed 62-27%. At the same time, supporters of Prop. 23 favor Fiorina over Boxer by 58-35% while opponents of Prop. 23 favor Boxer 60-32%.
The undecideds in the Senate race are opposed to the measure 47-28% — giving Boxer an opening to make inroads among voters who haven’t made up their mind about the Senate race but who know for sure they don’t want to roll back California’s climate change law.
Digging further into the Field Poll crosstabs yielded some other nuggets:
Brown’s favorable-unfavorable ratio among Democrats is just 68-15%, the reverse of his standing among Republicans which is 68-15% unfavorable. But among non-partisans – the true swing vote in California — Brown’s got a further problem: his standing is 47-34% unfavorable. On the other hand, his ratio is 50-34% favorable among moderates.
Among voters age 18-29, 35% have no opinion about Brown, among voters 30-39, 33% have no clue about him and three in 10 Latinos have no opinion about him. In other words, Brown has an enormous task ahead introducing himself to young voters before they hear about him from Whitman.
Whitman’s got favorability problems of her own. Her status among Republicans is 65-18% favorable and among Democrats it’s 60-20% unfavorable. Like Brown, the independents have an unfavorable view of her – 46-40%. Unlike Brown, moderates have a negative view of her, too: 45-39% unfavorable.
Despite spending a jillion dollars on TV and radio ads in the past few months, she’s not much better known among the 18-29 year-old voters than Brown is: 30% have no opinion of her and among those who have an opinion it’s 43-27% unfavorable. (The younger voters who know Brown like him a lot more: 39-26% favorable.)
Worst of all for eMeg: women don’t seem to like her much. Her favorability, which is 42-40% on the unfavorable side is driven mostly by women. Men see her favorably 43-41% but women lean 43-37% unfavorable.
Since the initiative and referendum were created just after the turn of the century in California, the “no” position on propositions has beaten the “yes” position about two-thirds of the time. When a proposition begins with less than 60% support, it’s historically in trouble. That can change if enough money and resources are thrown into the mix. But it’s tough. It doesn’t help the “yes” side when proponents advance silly arguments like we heard last week from John Kabateck, Executive Director of the National Federation of Independent Business/California, a co-chair of the Prop. 23 campaign.
Here’s the question that Field asked:
Have you seen, read or heard anything about a statewide ballot proposition to suspend state air pollution control and greenhouse gas emission laws until unemployment is reduced in California?
(As you know) this proposition would suspend state laws requiring reduced greenhouse gas emissions that cause global warming until California’s unemployment rate drops to 5.5 percent or less for four consecutive quarters. It requires the state to abandon its comprehensive greenhouse gas reduction program that includes increased renewable energy, cleaner fuel requirements and mandatory reporting and fees for major polluters such as power plants and oil refineries until the suspension is lifted. If the election were being held today, would you vote YES or NO on this proposition?
The complaint from the so-called “California Jobs Initiative”?
Most importantly, the survey failed to mention anything about the costs of AB 32 implementation, which are projected to run in the billions in higher electricity, natural gas, gasoline and diesel costs and to cause the loss of over a million jobs.
And then — we’re not making this up — after trashing the poll, they trotted out the old chestnut: “the only poll that counts is the one on election day” argument.
“The only poll that matters is the one that will go before voters on November 2nd, “concluded Kabateck. “We’re confident that when voters have all the facts they’ll vote for jobs, affordable energy and fiscal responsibility – that means a Yes vote on Prop. 23.”
The Legislature, consistently supported by the State’s coastal voters and enabled by the Governor’s quest for a legacy, continues to ride the pork express. Californians realized our water supply and distribution system was inadequate, sought answers from Sacramento, and were delivered a bond proposition only a bureaucrat hack could love. Sen. Denham is spot on.
By Jeff Denham, California State Senator District 12
The politicians and the special interests are at it again! Not only have they racked up a $19 billion deficit but now they are trying to con Californians into voting for a phony $11 billion water bond.
Proposition 18 is a pork measure that gives billions of dollars to special interests and bureaucrats:
The Riverside Press-Enterprise said it contains: "a host of other items that have little to do with the state’s central water concerns. The state simply cannot afford such politically motivated handouts."
Sacramento Bee Columnist Dan Walters observed: "There’s another $250 million(in Proposition 18) to partially pay for removing dams on the Klamath River that have nothing to do with California’s water supply — a benefit to PacifiCorp, the dams’ operator, which is owned by billionaire Warren Buffett, Schwarzenegger’s old pal."
San Jose Mercury-News asks: "why not just get them (legislators) to take out the pork and offer up a smarter, more basic plan that Californians might actually approve. . . ?"
The Legislature’s attorney admitted Proposition 18 is so poorly written that "…no amount of the $11,140,000,000 in bonds …would be required to be expended for a surface water storage facility…"
A so-called "water bond" that doesn’t even guarantee to build water facilities or increase water supply? Those politicians, lobbyists and bureaucrats have no shame. California’s bonded indebtedness is already at $73 billion!
Join family farmers, taxpayers, small business owners and other hardworking Californians by voting NO on Proposition 18 – the $11 billion boondoggle.
Next new post on Friday, July 9.
Jerry McNerney is an incumbent in a “throw the bums out” year. His district has zero registration advantage for him as a Democrat, and the NRCC has got him their his sights. But even against gales of hurricane born tar balls, he clings to hope.
Central Valley Callout has obtained the results of a mid-June, third party survey of CD 11 showing McNerney barely leading against David Harmer:
IF THE GENERAL ELECTION FOR CONGRESS WERE HELD TODAY, FOR WHOM WOULD YOU VOTE?
Republicans are not only in the fight, they’re on a path to victory. They are motivated and eager to send a vote for the Obama agenda out of office. The survey indicates the district is headed for big change:
IF YOUR CHOICES FOR GOVERNOR ARE MEG WHITMAN OR JERRY BROWN, FOR WHOM DO YOU INTEND TO VOTE?
Voters think they know Jerry Brown, and they’re already tired of him before he even begins campaigning in earnest. This is going to directly carry over to the Congressional race: no matter how much McNerney tries to stay out of the public eye, he’ll be tagged with both Brown and Obama.
The Democratic attack machine is going to have to do a lot better than their lame June 9 press release, David Harmer: A Shining Example of Bailout Hypocrisy. This grotesque distortion of Harmer’s work history reveals the disgusting, dishonorable depths to which the Democrats will descend in this election fight. Make no doubt about it, “lawyer” is a better ballot designation than “incumbent.”
District Republicans need to pull together and get McNerney out of office. And yes, it’s more than possible.
from News10 ABC.
The United Farm Workers’ Union has launched a campaign offering to train citizens and legal residents to, in effect, "Take our Jobs," as the campaign is called.
To that end, the union has set up a website where those interested can submit applications. The real reason behind the campaign, however, is to put a spotlight on problems with the nation’s immigration policies, as traditionally, farm labor jobs are not jobs American job seekers want.
In fact, said Bryan Little, the California Farm Bureau’s Director of Labor Affairs, attempts by farmers in the past to recruit the unemployed for agricultural work have not been successful.
"Very often," Little said, "those workers don’t have the right skill set, they’re not used to doing agricultural work, maybe they don’t even have transportation to get out to the farm and be able to do that sort of thing. So, as a result, typically, most of them don’t last very long."
Job seekers at the Employment Development Department on Broadway though said they would be quite willing to give it a try.
"Well, sure, I’d consider it for the simple fact a job is a job," said Keith Gales. "Standing here at the unemployment line, I’d gladly do it. I really would."
"Times are hard right now. We’re going through a recession. I myself have been out of work for a year and a half and if I’m able to make it back and forth to work each day, I wouldn’t mind doing farm work," said Brian Williams.
According to UFW President Arturo Rodriguez speaking in a teleconference call on Thursday, more than 50 percent of farm workers do not have legal authorization to be in the U.S.
"If we were to deport all undocumented farm workers, it would mean the collapse of the agriculture industry as we know it today," Rodriguez said.
Both the UFW and the California Farm Bureau are supporting an ag jobs bill now in the U.S. Senate. The campaign, said farm bureau officials, may help.
"Their approach is interesting because we think it helps make the point that we agree with: that we need to pass ag jobs (legislation) and we need to create a guest worker program that can get workers in and out of the country efficiently and legally," said Little.
(The suspend AB 32 initiative will be on the November ballot. Nothing is more important to the economic growth of the recession ravaged Central Valley than passage of this initiative.)
You’ve probably heard of cargo cults. Wikipedia has a good definition:
A cargo cult is a type of religious practice that may appear in traditional tribal societies in the wake of interaction with technologically advanced cultures. The cults are focused on obtaining the material wealth (the “cargo”) of the advanced culture through magic and religious rituals and practices, believing that the wealth was intended for them by their deities and ancestors….
Cargo cult activity in the Pacific region increased significantly during and immediately after World War II, when large amounts of manpower and materials were brought in by the Japanese and American combatants, and this was observed by the residents of these regions. When the war ended, the military bases were closed and the flow of goods and materials ceased. In an attempt to attract further deliveries of goods, followers of the cults engaged in ritualistic practices such as building crude imitation landing strips, aircraft and radio equipment, and mimicking the behavior that they had observed of the military personnel operating them.
This explains the continued support by Gov. Arnold Schwarzenegger and a majority of state legislators for AB32, the “Global Warming Solutions Act of 2006.” AB32 mandates cuts in greenhouse gas emissions by 20% by year 2020. The reason, as the title indicates, is to reduce man-made global warming.
But Schwarzenegger, Al Gore and others want to believe that humans — we little specs on the planet — supposedly caused a great calamity of “global warming,” and that adopting green economies and technologies will make everything better. This is the Cargo Cult aspect of the global warming religion. Schwarzenegger is shown in the picture at right signing AB32, the Cargo Cult Incantation Document.
These folks see that things are produced in by an advanced technological civilization, but think that the production comes from enacting multiple controlling laws on industry, instead of by hard work and free markets.
Just as the primitive tribes believed that, by constructing a wooden cargo plane, the cargo would magically appear, the modern Cargo Culters believe that by enacting even more laws — such as AB32 — the goods we enjoy in modern industrial society will continue to appear. Just listen to the incantatory wording of the text of AB32:
By exercising a global leadership role, California will also position its economy, technology centers, financial institutions, and businesses to benefit from national and international efforts to reduce emissions of greenhouse gases.
They’re like Cargo Culters chanting for the straw planes they built to zoom up into the air and bring the bounties of civilization. But nothing ever comes.
Global warming is not only a cargo-cult superstition, but the biggest scientific hoax ever, making Piltdown Man look like the Pythagorean Theorem. Especially since the Climategate scandal broke last fall, showing that the “climate change” data had been rigged from the get go. Although at least Piltdown Man never cost millions of jobs.
This week, even one of the main global warming boosters has recanted:
Untold billions of pounds have been spent on turning the world green and also on financing the dubious trade in carbon credits.
Countless gallons of aviation fuel have been consumed carrying experts, lobbyists and politicians to apocalyptic conferences on global warming.
Every government on Earth has changed its policy, hundreds of academic institutions, entire school curricula and the priorities of broadcasters and newspapers all over the world have been altered – all to serve the new doctrine that man is overheating the planet and must undertake heroic and costly changes to save the world from drowning as the icecaps melt.
You might have thought that all this was based upon well-founded, highly competent research and that those involved had good reason for their blazing, hot-eyed certainty and their fierce intolerance of dissent.
But, thanks to the row over leaked emails from the Climatic Research Unit, we now learn that this body’s director, Phil Jones, works in a disorganized fashion amid chaos and mess.
Interviewed by the highly sympathetic BBC, which still insists on describing the leaked emails as ‘stolen’, Professor Jones has conceded that he ‘did not do a thorough job’ of keeping track of his own records.
His colleagues recall that his office was ‘often surrounded by jumbled piles of papers’.
Even more strikingly, he also sounds much less ebullient about the basic theory, admitting that there is little difference between global warming rates in the Nineties and in two previous periods since 1860 and accepting that from 1995 to now there has been no statistically significant warming.
He also leaves open the possibility, long resisted by climate change activists, that the ‘Medieval Warm Period’ from 800 to 1300 AD, and thought by many experts to be warmer than the present period, could have encompassed the entire globe.
This is an amazing retreat, since if it was both global and warmer, the green movement’s argument that our current position is ‘unprecedented’ would collapse.
Medieval Warm period
Of course, any person with even a passing knowledge of high school history knows that Icelanders and Norwegians colonized Greenland about 1,000 years ago back when it was a lot warmer that it was today. That’s the “medieval Warm Period” mentioned in the article. Then it got colder and the colonists left.
This 59-second YouTube also shows how, over the past half million years, the earth has been much cooler than it has been in recent millennia, and that a new ice age is something almost certain to happen:
By JOHN SEILER at CalWatchDog, June 21, 2010
(The Central Valley is bearing the brunt of the current recession (over NOT), will Bay Area politicos Jerry or Meg really care if we move to round two?)
Here’s something Meg Whitman and Jerry Brown should be debating.
As the California budget is haggled over by the governor, Legislature and the powerful government unions, one thing everyone assumes is that the California economy will gradually improve. That it will keep lifting its head out from the mire of the 2007-09 recession. Gov. Arnold Schwarzenegger’s May Revise of his fiscal 2010-11 budget proposal observes that “there continue to be signs the economy is slowly improving.” And:
The national and California economies improved between the Governor’s [January] Budget and the May Revision. … In fact, the good signs are coming at an increasing rate, especially in the national economy….
Based on better than expected indicators that have been released since the Governor’s Budget forecast, most notably GDP growth in the final quarter of 2009 that was much stronger than anticipated, the outlook for the national and state economies is more positive, but remains cautious.
But the proposal does caution that, “Despite these positive developments, the recovery remains fragile.”
However, what if even these cautious statements are not cautious enough? When working on a budget, a prudent family or business takes into account the possibility of economic calamity. Such a family or business saves a decent amount of money in a “rainy day” fund. And even in modestly bad times, it sharply cuts expenditures well below income to insure that debt is not accrued that will severely damage, or even bankrupt, the family or business.
In recent decades, California has never taken such precautions. Even when times were good and the tax money was rolling in, as during the dot-com boom of the late 1990s or the real estate-boom of the mid-2000s, instead of saving some money for use during a recession, virtually all the surplus tax money collected was spent on increasing the budgets of state agencies and pension spiking. No “rainy day” fund ever was funded.
Because there will be no cushion should the second half of a “double dip” recession hit within the next year or too, it’s worth contemplating what will happen.
Recession Part Two in 2011?
Some of our best economists are warning that 2011 well could bring a renewed recession. Even if they are proved wrong – as everyone hopes will be the case – prudent budget crafting should take into account their warnings.
Because most of President Bush’s 2003 tax cuts expire in 2011, economist Arthur Laffer is forecasting a major recession. Laffer is the head of Laffer Associates. Formerly located in San Diego, it recently relocated to Nashville, Tenn., to escape California’s high taxes. In particular, the 10.55 top California income tax rate compares badly with Tennessee’s 0 percent. Laffer helped craft Proposition 13, the 1978 property tax cut measure in California, and President Reagan’s tax cuts – both of which formed the foundation of 30 years of California prosperity.
In the June 6 Wall Street Journal, Laffer wrote:
On or about Jan. 1, 2011, federal, state and local tax rates are scheduled to rise quite sharply. President George W. Bush’s tax cuts expire on that date, meaning that the highest federal personal income tax rate will go 39.6% from 35%, the highest federal dividend tax rate pops up to 39.6% from 15%, the capital gains tax rate to 20% from 15%, and the estate tax rate to 55% from zero. Lots and lots of other changes will also occur as a result of the sunset provision in the Bush tax cuts.
But hasn’t the economy been growing since the middle of 2009, when the recession ended? Yes. But the reason is that taxpayers, anticipating getting hit with the 2011 tax increases, are squeezing as much economic growth and profit into the months before then.
Here’s the scary part. Laffer explained:
Now, if people know tax rates will be higher next year than they are this year, what will those people do this year? They will shift production and income out of next year into this year to the extent possible. As a result, income this year has already been inflated above where it otherwise should be and next year, 2011, income will be lower than it otherwise should be.
In a discussion with me, Laffer also used an analogy to a sale, which I’ll adopt for our purposes. Suppose a store offers a 25 percent-off sale for the July 4 weekend, which is coming up. Predictably, sales and profits will rise that weekend. But the day after the sale ends, sales and profits will be lower than usual.
For a government, lower income by businesses and citizens means a recession. And it means a lower tax base, leading to fewer taxes collected – and a bigger state budget deficit.
California tax cuts
It’s true that Gov. Schwarzenegger’s record $13 billion in tax increases of 2009 expires next year – assuming he and the Legislature don’t extend the tax increases another year to close this year’s $19 billion budget deficit.
But even assuming the tax reductions go into effect in California, they won’t be big enough to discourage people and businesses from leaving for tax havens such as Texas. Consider:
In 2011, the top federal income tax rate will zooms from 35 percent to 39.6 percent. For a Californian in the top tax bracket, that means tax rates of:
In 2010: 45.55 percent (35 percent federal plus 10.55 percent state) – current marginal tax rate.
In 2011: 49.9 percent (39.6 percent federal plus 10.3 percent state) – marginal tax rate next year, in 2011, a 4.45 percentage-point increase.
In 2011 – moving out of California: 39.6 percent (39.6 percent federal plus 0 percent state) – marginal tax rate if you move to Washington, Texas, or some other state with no state income tax. That’s a 5.95 percentage-point overall tax cut, even after the federal tax increase.
The meaning for California
In my call to Dr. Laffer, I asked him about how the federal tax increases directly would affect California. “California is a part of the United States, and will be affected directly as a consequence,” he told me. “The higher tax rates will make California more vulnerable than most other states – although not all of them.”
As I noted in a previous CalWatchDog.com piece, a study Laffer conducted with the American Legislative Exchange Council (ALEC) included California in the category “States That Do Everything Wrong.” Other states in that category were New York, Michigan and New Jersey. Since then, rookie New Jersey Gov. Chris Christie has been cutting budget waste and taxes. So perhaps it will drop out of that dismal group.
“People don’t work to pay taxes,” Laffer continued. “They work for what they take home after paying taxes. States with the highest tax rates will be the most disadvantaged. California is right at the top of that pile. States with the most debt will be especially burdened.”
For his ALEC study, Laffer came up with the “Moving Van Effect,” gauging how many people were moving out of one state to another state. California saw 1.4 million leaving the state between 1999 and 2008, second worst after New York’s 1.7 million leaving.
Laffer said he expects California to maintain a high Moving Van Effect. “California economy is not where anyone wants to be if they care about economics.”
Still a great place…
I got more perspective from David Zetland, Wantrup Fellow in Natural Resource Economics and Political Economy at the University of California, Berkeley, and editor of the Aguanomics.com Web site on water policy. “As goes the nation, so goes California,” he told me of what would happen if the economy tanks in 2011. “Besides the obvious (lower tax revenues, higher unemployment), there will also be an Uh-oh effect – people will really dig in and cut back on spending, to make sure that they do not end up on the streets.”
As to whether a renewed recession would encourage more jobs to leave California, he replied, “Yes and no. Maybe the government will realize that reform is necessary. If there’s no change, then existing ‘hanging on’ businesses may call it quits or leave the state.”
As to how big the state budget deficit might get in another recession, he said it was difficult to speculate. But it could get “bigger, and maybe much bigger. Falling income taxes and rising expenses are an ugly pair. If you need a number, try $25 billion.”
He also doesn’t think a new recession would be a spur to more Californians leaving. The question, he said, is: “Will there be more jobs elsewhere, i.e., will other states
recover faster? If not, and housing prices drop again, then they will either be trapped in houses (underwater) or able to afford cheaper houses. Moving is financially and emotionally costly, so people will not leave unless things are obviously better elsewhere. And others will fill their places. California is still a great place, government aside.”