How to Reduce the California State Budget by $40 Billion

As of a few days ago, high-wage earners have a new reason to leave California: their state income taxes are no longer deductible on their federal income tax returns.

Can California’s union-controlled state legislature adapt? Can they lower the top marginal tax rates to keep wealthy people from leaving California?

The short answer is, no, they cannot. They cannot conceive of the possibility that California’s current economic success is not because of their confiscatory policies, but in spite of them.

Earlier this year California’s union controlled legislature approved a gas tax increase that will increase state tax revenue by about $5.0 billion per year. Next in their sights is changing property taxes to a “split roll” system, whereby all commercial properties will no longer be protected from steep tax rate increases. Also under consideration is extending sales taxes to services, along with taxes on water, marijuana, and, who knows, maybe even robots.

These new taxes have attracted a lot of attention, but in reality California’s state government derives most of its tax revenue, 58%, from personal income tax. In recent years personal income taxes have contributed as much as 65% of the California state government’s total tax revenue. California’s top marginal income tax rate of 13.3% is by far the highest in the U.S. Oregon has the 2nd highest rate, at a much lower 9.9%. The impact of this can be seen on the chart depicted below, which is taken from the […] Read More

Rhetoric to Challenge California’s Statist Elites

California’s ruling elites have enacted policies that make it impossible for middle class citizens to live here. They have artificially elevated the cost of living, nearly destroyed public education, decimated public services, neglected public infrastructure, and declared war on small business. To deflect criticism, they’ve convinced a critical mass of voters that any attempts to roll back these abominable policies are being engineered by racist, sexist plutocrats, and their willing puppets in the Republican party.

Exposing this diabolical, conniving scam won’t be easy. The ruling elites are a powerful coalition, comprised of left wing oligarchs including most of Silicon Valley’s billionaires, California’s public sector unions armed with the billion dollars (or more) they collect every year in forced dues, and the environmentalist lobby and their powerful trial lawyer cohorts.

Defeating California’s ruling elite requires a new coalition, comprised of the private sector middle class, enlightened members of the public sector middle class, and members of disadvantaged communities that aspire to the middle class. Attracting members of these communities, especially California’s Latinos, Asians, and African Americans, requires convincing them that current policies actually harm their interests.

To do this, there are two moral arguments the elites make that have to be debunked, because they underlie all of the intrusive, statist policies that are destroying California’s middle class. The first is the argument that capitalism is inherently evil and must be strictly curbed if not completely replaced by socialism. The second is the argument that unprecedented sacrifices must be made in order […] Read More

The Government Union War on Meritocracy

How can you persuasively counter arguments for diversity quotas, when implacable fanatics purporting to represent every identifiable group whose aggregate achievements fall short of the mean will argue it is discrimination, not merit, that determine outcomes? Expect no help from government unions. Resentment gives them passion, restitution gives them power. Undermining the meritocracy is key to their survival.

Imagine a public school system where the excellence of teachers was the only institutional criteria for their job security and prospects for career advancement. Imagine government bureaucracies where innovative, more effective practices were adopted even if it meant smaller budgets and fewer employees. Imagine law enforcement agencies that had zero tolerance for officers that abused their authority. Are we there yet? Not if government unions have anything to say about it.

But the government union war on the meritocracy goes well beyond protecting bad employees. Government unions representing K-12 teachers and college faculty have been overran by “social justice warriors” who preach identity politics as the new religious gospel and the new academic canon. They have taken their war on the meritocracy into the classrooms and lecture halls, saturating the curricula from kindergarten to graduate school. Their message? Unless you are a heterosexual white male, you are a victim of discrimination by heterosexual white males. You live in an unjust society. Merit, according to this doctrine, is a smokescreen. It is discrimination in disguise.

What do you do if you believe in meritocracy? What do you do about this?

Math […] Read More

How Public Sector Unions Exploit Identity Politics

As the ethnic composition of America changes from mostly white to a kaleidoscope of color within a generation, there is no better way to fracture society than to teach everyone to resent everyone else. Nurturing tribal resentment is a winning strategy for government unions, because a swollen, authoritarian, unionized government becomes the referee. Government union power increases every time another “person of color” becomes convinced that only government redistribution and racial quotas can mitigate their persecution at the hands of a racist white “patriarchy.”

When society fractures, when we face increasing unrest and poverty, government unions win. It is inherently in the interests of government unions for society to fail. If public education fails, hire more teachers and education bureaucrats. If crime goes up, hire more police and build more prisons. If immigrants fail to assimilate, hire more multilingual bureaucrats and social workers. If poverty increases, hire more welfare administrators.

If you don’t think this strategy can work, come to California, America’s most multi-ethnic state, and a place where government unions wield absolute power. Their wholly owned subsidiary, the Democratic party in California, has spent the last 20+ years perfecting the art of convincing the electorate that Republicans are racists. The strategy has been devastatingly effective, especially with people of color.

According to the Public Policy Institute of California, among California’s “likely voters,” slightly more Whites remain registered as Republicans, 39%, than Democrats, 38%. Among Latinos the registered Democrats, 62%, far outnumber Republicans, 17%, and among Blacks the disparity […] Read More

Without Government Unions, there Would be No Gas Tax Increase

Nobody argues that California’s roads need huge upgrades. But the solution didn’t require the $0.12 per gallon tax hike that goes into effect today. The root cause of these neglected roads – and the reason even more taxes will never be enough to fix them – is the power of public sector unions, whose agenda is consistently at odds with the public interest. Let us count the ways.

1 – CalTrans mismanagement:

CalTrans could have done a much better job of maintaining California’s roads. One of the most diligent critics (and auditors) of CalTrans is state Senator John Moorlach (R, Costa Mesa), the only CPA in California’s state legislature. Last year, Moorlach released a report on CalTrans which he summarized in “7-Step Fix for ‘Mismanaged’ Caltrans,” an article on his official website. Just a few highlights include the following:

In May 2014 the Legislative Analyst Office determined that CalTrans was overstaffed by 3,500 architects and engineers, costing over $500 million per year. While to an average state transportation agency outsources over 50% of its work, CalTrans outsources only 10% of its work. Arizona and Florida outsource more than 80%. 54% of CalTrans staff is at or near retirement age, so a hiring freeze would reduce staff merely through attrition, without requiring layoffs.

But Moorlach didn’t make explicit the reason CalTrans is mismanaged. It’s because the unions that run Sacramento don’t want to outsource CalTrans work. The unions don’t want to reduce CalTrans headcount, or hold CalTrans management accountable. Those […] Read More

What We Could Build With $64 Billion

AUDIO: A discussion of more useful infrastructure projects that could be funded with the $64 billion that is currently budgeted for the “Bullet Train” in California – 14 minutes on KFI Los Angeles – the John and Ken Show.

Keeping Friends in the Age of Trump

AUDIO: Life behind the Blue Curtain – 13 minutes on KABC Los Angeles.

The Opportunity Cost of High Speed Rail

AUDIO: A discussion of more useful infrastructure projects that could be funded with the $64 billion that is currently budgeted for the “Bullet Train” in California – 8 minutes on KOGO San Diego – the Carl DeMaio Show.

What Californians Could Build Using the $64 Billion Bullet Train Budget

California’s High-Speed Rail project fails to justify itself according to any set of rational criteria. Its ridership projections are absurdly inflated, its environmental benefits are overstated if not actually net detriments, and its cost, its staggering cost, $64 billion by the latest estimate, overwhelms anyone with even a remote sense of financial proportions. To make this final point clear, here is an assortment of California infrastructure projects that could be paid for with a $64 billion budget.

If these projects were built, instead of the bullet train, Californians would have abundant, cheap electricity, abundant fresh water, and upgraded roads and freeways capable of handling all the traffic a surging economy could possibly dish out.

(1) Build 10 natural gas power plants generating 6.2 gigawatts of electrical output for $5.7 billion.

According to the U.S. Energy Information Administration, a modern natural gas power plant generating 620 megawatts can be built at a capital cost of $568 million. Someday, when electricity storage technologies are inexpensive and safe, the solar age can ripen to maturity, but in the meantime, California’s private energy companies can tap abundant in-state natural gas reserves, enabling California’s public utilities to provide cheap electricity to the public.

Since California’s peak demand rarely exceeds 50 gigawatts, increasing capacity by 12% will drive the price for electricity way down, making California competitive again with other states. Cheap electricity will also obviate the need to force consumers to purchase extremely expensive “energy sipping” appliances that are internet enabled, monitor […] Read More

How California’s Leftists Are Puppets of the Plutocrats

AUDIO: A lively discussion on pensions, pension fund solvency, and how leftists are being duped by oligarchs – 30 minutes on KUHL 1440 Santa Maria (Central Coast) – the Andy Caldwell Show.