Thread: Fiscal woes imperil Schwarzenegger

Fiscal woes imperil Schwarzenegger
With California's debt topping $16 billion, the governor is stuck with a legislative standoff over tax hikes.
By Daniel B. Wood | Staff writer of The Christian Science Monitor
the February 29, 2008 edition -
Los Angeles



Four years ago, he left Hollywood to save America's most populous state from "girlie men," legislators who "couldn't balance a checkbook." Calling himself the people's governor, he declared war on the state's special interest lobbies and promised to make a dysfunctional state work smoothly again.

Now, he finds himself in the same fiscal straits – $16-billion-plus in state debt – as the infamous governor he replaced in 2003's recall election, Gray Davis. And California's legislature is once again gridlocked.

Politicos laud Gov. Arnold Schwarzenegger for his leadership on global warming. They grant him kudos for his optimism and his embrace of post-partisan values – his Republican administration is peppered with Democrats. But the laundry list of failures is growing – from his ambitious healthcare reforms to his plans for overhauling the state's water infrastructure – and his own party faithful are falling out of step, causing a renewed legislative impasse.

Now, with an economic slowdown looming, some pundits are wondering aloud if Governor Schwarzenegger's tenure will ultimately be judged a failure. Others counter that the still-popular Schwarzenegger is doing as well as any governor can, given the downturn and California's built-in administrative problems.

"The mood in the capital is more upbeat [than before he took office] but that's about it … he's got us right back where Gray Davis had the state," says Sherry Bebitch Jeffe, a political scientist at the University of Southern California.

The downturn is not helping, she says, as it is depressing income for state departments while undermining negotiations for everything from healthcare reforms to prisons.

In trying to close the yawning fiscal gap, Schwarzenegger is locked in a battle with both the legislature and the state's independent legislative analyst. The governor has proposed a budget that would cut government spending by 10 percent, including healthcare and public assistance, and that would mean closing 48 state parks and slashing $4.7 billion from schools.

He also wants to use more borrowing and fund transfers, which critics say are well-worn gimmicks that will only postpone the problem.

Legislative analyst Elizabeth Hill has taken the unusual step of drafting a counter plan that would raise taxes by at least $2.7 billion and modify or eliminate a dozen tax breaks. Instead of closing 48 state parks, she says, government fees can be raised. And she has targeted what she calls a major "sloophole," that allows yacht buyers to avoid sales taxes by keeping their newly purchased boats out of the state for 90 days.

Many Democrats have embraced Ms. Hill's ideas, but the governor and GOP legislators have said they will continue to block tax increases.

The standoff is yet another indication that California's governance problems are structural rather than a reflection of its chief executive, say many analysts. "There are weights that even Arnold Schwarzenegger cannot lift," says Jack Pitney, a political scientist at Claremont McKenna College.

The heaviest of these, say Mr. Pitney and others, is the requirement of a two-thirds majority in the legislature to pass a budget. That is a high bar for any state, but especially so in California where over 75 percent of legislative districts are considered "safe," meaning incumbents are entrenched and have little fear of being voted out of office.

"It is nigh on impossible to get the legislature to agree on anything significant," says Barbara O'Connor, a political scientist at California State University, Sacramento.

The ideological differences are also magnified because of the state's gerrymandered district map, she says. Yet, attempts to redraw districts are regularly defeated – two such measures have failed in the past two years.

Another major structural problem is that many spending and income formulas are set by previous state initiatives, including a 1978 property tax cut and Prop. 98 which locks in a substantial proportion of the state budget for education.

Such policies "rob" the legislature's ability to shape spending, says Tony Quinn, a Sacramento-based analyst. "What we have here is auto-pilot spending which is a whole bunch of spending plans that are built into law that generate a larger and larger segment of the state budget every year and the legislature has less and less direction."

Despite the current impasse, most analysts agree that Schwarzenegger has brought a breath of fresh air into the statehouse. His popularity remains high – 58 percent approval in one recent state poll – in part because of his special brand of joviality, manifested in jokes from the bully pulpit, his self-deprecation, and his beneficent arm-twisting of legislators. His wife, Maria Shriver, has also helped his popularity.

"Everywhere they go, people love them and they love the fact that her Kennedy-family background has helped chasten Arnold's conservatism," says O'Connor.

Citing last year's ambitious initiatives on global warming and health insurance, O'Connor says: "People like [the fact] that he tries to slay the big dragons. He doesn't always win but they give him points for trying."
http://www.csmonitor.com/2008/0229/p03s01-usgn.html

Have you heard the saying, when California sneezes, the rest of the country catches the flu? Generally what starts in California eventually spreads to the rest of the country. That is, unless a state takes measures to resist it. Unless evey state realistically tackles illegal immigration by instituting Comprehensive Immigration ENFORCEMENT, which California has refused to do, this is what you can expect:

As of 2006, California contained greater than 25% of the total illegal alien population within the U.S. Many of these illegals concentrate in Los Angeles. New statistics from the Department of Public Social Services reveal that illegal aliens and their families in Los Angeles County collected over $37 million in welfare and food stamp allocations in November 2007 – up $3 million dollars from September. Twenty five percent of the all welfare and food stamps benefits are going directly to the children of illegal aliens. Illegals collected over $20 million in welfare assistance for November 2007 and over $16 million in monthly food stamp allocations for a projected annual cost of $444 million. “This new information shows an alarming increase in the devastating impact Illegal immigration continues to have on Los Angeles County taxpayers,â€

Some of the Costs of Illegal Immigration
CNN 1/8/2008
http://www.youtube.com/watch?v=hduG9Dw0oYg

Los Angels County:

10% of Los Angeles County residents are illegal aliens (the highest percentage of county residents in the country)

Illegal aliens cost the county greater than one billion dollars per year in taxpayer costs, not counting education.

Breakdown:
$444 million for welfare and food stamps
$400 million for health care
$220 million for correctional services, law enforcement and other public safety costs

New statistics from the Department of Public Social Services reveal that illegal aliens and their families in Los Angeles County collected over $37 million in welfare and food stamp allocations in November 2007, which is up $3 million dollars from September.

Children of illegal aliens receive 25% of welfare and food stamp money

---Mike Antonovich, LA County Supervisor

Arizona:

A study published in 2004 by FAIR about costs of illegal immigrants in Arizona, stated “Arizona’s illegal immigrant population is costing the state’s taxpayers about $1.3 billion per year for education, medical care and incarceration. Even if the estimated tax contributions of illegal immigrant workers are subtracted, net outlays still amount to about $1.3 billion per year. The annual fiscal burden borne by Arizonans amounts to more than $700 per household headed by a native-born resident: The report also states that the $1.3 billion cost associated with illegal immigration in Arizona does not include other costs such as special English instruction, school nutrition programs, or welfare benefits for American workers displaced by illegal alien workers.

A Harvard University study released in January 2008 found that illegal aliens depressed wages in Arizona by $1.4 billion dollars. Hardest hit were low skilled legal workers whose wages fell by 5%.
http://www.azcentral.com/business/artic ... 10-ON.html

U.S.

Nationwide, 40% of households headed by an illegal alien receive welfare benefits and 56% have no health insurance.

Standard & Poor’s reports that education of illegal alien children costs the states and federal government $11 billion dollars per year.
http://www.youtube.com/watch?v=hduG9Dw0oYg

Taxpayers in our country pay more than $100 billion every year on health care and other services for illegal immigrants, including education, law enforcement costs, and housing. – Congressman Dean Heller-Jan. 2008 http://www.nevadaappeal.com/article/200 ... /729401847

"The mood in the capital is more upbeat [than before he took office] but that's about it … he's got us right back where Gray Davis had the state," says Sherry Bebitch Jeffe, a political scientist at the University of Southern California.




Why wouldn't it be? The Reconquistas vowed to turn CA into Mexico and that's exactly what they've done.

Of course they're happy!!

“This new information shows an alarming increase in the devastating impact Illegal immigration continues to have on Los Angeles County taxpayers,â€

Instead of closing 48 state parks, she says, government fees can be raised

Great! So now I have to pay more to go to a park because Arnold and the rest of his clan will not address the real reason as to why this state is bankrupt! I do not hear one person addressing the issue of illegal invaders and the tremendous burden they are to this state and country.

Instead, they will implement fee hikes so that the quality of life for American Citizens can further decay, all so the illegal invader can continue to receive funding.

Disgusting!

Originally Posted by NoBueno

Instead of closing 48 state parks, she says, government fees can be raised

Great! So now I have to pay more to go to a park because Arnold and the rest of his clan will not address the real reason as to why this state is bankrupt! I do not hear one person addressing the issue of illegal invaders and the tremendous burden they are to this state and country.

Instead, they will implement fee hikes so that the quality of life for American Citizens can further decay, all so the illegal invader can continue to receive funding.

Disgusting!

Trust me you don't want to go to the parks any more. The beaches are disasters now from the garbage and people sitting on top of you.

LOL. I know Gogo. But should I ever desire again to dodge soccer balls or be treated to an illegal invader changing her anchor's diaper, virtually in my face, I would hope I could experience such pleasures without having to pay more to do so.

Originally Posted by NoBueno

LOL. I know Gogo. But should I ever desire again to dodge soccer balls or be treated to an illegal invader changing her anchor's diaper, virtually in my face, I would hope I could experience such pleasures without having to pay more to do so.

ROFLMBO

Thanks for the articles zeez. The high cost of cheap labor & votes indeed. And our elected officials still intentionally have their collective heads in the sand.