Thread: California Cut 37,000 Gov Jobs in Sept; Much More to Come

Sunday, October 24, 2010

California Cut 37,000 Government Jobs in September; Much More to Come

The LA Times reports Government job cuts ravage California http://www.latimes.com/business/la-fi-1 ... 3435.story

Weighed down by a struggling economy, government agencies in California shed 37,300 workers last month — more jobs than were lost in the private sector — as cities and counties made their biggest payroll cutbacks since at least 1990.

What's more, analysts see more job cuts ahead as California faces an estimated $10-billion shortfall in the state budget that the next governor must address. Cities and counties, meanwhile, are still struggling with tepid sales and property tax revenue.

Cities across the state have taken stringent measures to balance their budgets, said Eva Spiegel, a spokeswoman with the League of California Cities.

Oakland laid off 80 police officers and delayed pothole repairs. Fullerton laid off 14 police officers and three firefighters, cut library hours and closed restrooms at several parks. Oceanside laid off 28 police officers and three firefighters, closed a swimming pool and a recreation center and eliminated the city Bookmobile.

Overall, the state's unemployment rate remained stuck at 12.4%, one of the highest in the nation. The state lost a net 63,600 jobs in September. Local governments shed 32,400 jobs, according to the monthly report from the state Employment Development Department released Friday.

Taxable sales plummeted 18.5% in California from 2006 to 2009 and are expected to remain relatively flat this year, according to the National University System Institute for Policy Research in La Jolla.

The National League of Cities reported this month that cities across the country were making their sharpest cuts in at least a quarter of a century. Nearly 80% of city finance officers in a survey reported laying off staff, and 87% said their cities were worse off financially this year than last year.

Taxable Sales Down 18%

Those last two paragraphs are the key to understanding one of the things I have been saying, that there is no recovery in sales.

Every month, when retail sales numbers come out, I question them. Here is my article from October 15: Retail Sales Rise More Than Forecast; Once Again I Ask "Really?" http://globaleconomicanalysis.blogspot. ... ecast.html

Retail sales may be at their best point in the year, but sales are certainly not within 3% of the all time high [as government data shows]. If they were, tax revenue collection would be exceeding all time highs given increases in sales taxes.

Sales Tax Collections Down 5.9% June 2010 vs. June 2008

In spite of numerous sales tax hikes, tax collections are still 5.9% lower than two years ago. Moreover, June of 2008 was not the pre-recession peak. November of 2007 was the pre-recession peak.

Bear in mind those statistics are as reported in Retail Sales Rise .4% from July - How Far to Pre-recession Levels? Where to from Here? reflective of the second quarter. http://globaleconomicanalysis.blogspot. ... w-far.html

See link for several charts.

Unless consumers have gone on a tear in the third quarter (highly unlikely with renewed slowdown in housing as well as the recent Gallup survey above), these retail sales reports are simply not believable.

What's clear is the methodology is flawed. By how much is the question. The way to figure out how much is to factor in all sales tax hikes and compare state sales tax collections. I will take another look at that as time permits.

Expect More Cutbacks, Lots More

Just a few days ago I penned, Severe, Life-changing, and Consciousness-Altering State Budget Cuts Coming. http://globaleconomicanalysis.blogspot. ... sness.html

The LA Times article is but a start for what I envision. Moreover, it does not even begin to address the fact that California Pension Promises Exceed 550% of State Tax Revenue by 2012; A Look at Solutions. http://globaleconomicanalysis.blogspot. ... d-550.html

Finally, it should be crystal clear that Los Angeles, Oakland, San Diego, and numerous other cities in California and nationwide are bankrupt, mostly over public union pension promises that cannot be met.

Here are a few posts:

* Oakland California Bankrupt - Councilwoman Pat Kernighan Calls Rest of Council "Crazy and Irresponsible" http://globaleconomicanalysis.blogspot. ... krupt.html

* L.A. Controller Says City Could Run Out of Cash by May 5 http://globaleconomicanalysis.blogspot. ... n-out.html

* Mayor of Los Angeles Says "Bankruptcy is Not an Option" http://globaleconomicanalysis.blogspot. ... cy-is.html

The most galling thing in all of this is public unions across the country are demanding more tax hikes so they can receive benefits those in the private sector can only dream about.

Indeed, most of the police, fire, and teacher layoffs underway have to happen, if only the unions would except cutbacks in pay and benefits. Instead, senior union members always vote to toss the junior members to the dogs, then have the gall to blame voters for not hiking taxes.

Mike "Mish" Shedlock

http://globaleconomicanalysis.blogspot. ... bs-in.html

If you want smaller government you have to cut government jobs.

It looks like CA. is leading the country into smaller government.

Good job California! But California, how many illegal aliens have you arrested and readied for deportation? Cutting government jobs you can't afford is great, like icing, but it's still not the cake.

Originally Posted by Judy

Good job California! But California, how many illegal aliens have you arrested and readied for deportation? Cutting government jobs you can't afford is great, like icing, but it's still not the cake.

8,700 criminal illegal aliens located in the L.A. County jails during the last two months
http://www.alipac.us/ftopict-177905.html

6,000 Criminal Illegal Aliens found in San Diego County jails
http://www.alipac.us/ftopict-177988.html

The following states have more than 65% of their jurisdictions enrolled in the I.C.E. Secure Community Program.

All other states do NOT.

AZ. 11 of 15 - 73%
CA. 38 of 58 - 66%
DE. 3 of 3 - 100%
FL - 67 of 67 - 100%
HI - 3 of 4 - 75%
TX. 260 of 260 - 100%
VA. 129 of 129 - 100%

Finally, it should be crystal clear that Los Angeles, Oakland, San Diego, and numerous other cities in California and nationwide are bankrupt, mostly over public union pension promises that cannot be met.

Getting rid of all services to illegals who shouldn't be getting them in the first place would go a long way to balancing most State budgets.... those people are a drain on society...then you can start with the politicians....they don't work for us anyways.....


Kathyet