State Politics & Right-to-Work

While much analysis has been forthcoming on the impact of the November 2010 election on the U.S. Senate and U.S. House of Representatives, it is harder to get compiled information on how that election affected political control of 50 states. An excellent source for this much larger body of data comes from the American Legislative Exchange Council, who just released the report Political Profiles of State Legislatures 2011, which, when compared to their report from last year, Political Profiles of State Legislatures 2010, provides dramatic evidence of the changes wrought by the November election.

A brief summary of what November 2010 did to the political landscape of the 50 state legislatures is this: Before the election the Republicans controlled both houses of 16 state legislatures (counting Nebraska, which only has a Senate), the Democrats controlled both houses of 27 state legislatures, and 7 states had one party controlling each house. After the election the Republicans controlled both houses of 26 legislatures, the Democrats controlled both houses of 15 state legislatures, and 9 states had one party controlling each house. If you simply total up the number of state legislators affiliated with the major parties, in state senates the totals changed from 1,025-897 in favor of Democrats before the election to 1,023-889 in favor of Republicans afterward, and in state houses the totals changed from 3,023-2,354 in favor of [...] Read More

How to Revive California’s Economy

The previous post, “Balancing California’s Budget,” recommends spending cuts that extend well beyond incoming Governor Brown’s proposed budget (ref. Full Budget Summary), especially in the areas of (1) entitlements, (2) prisons, and (3) education. In all these areas, the case is made that thoughtful restructuring and downsizing of these institutions will actually improve societal outcomes. At the same time, as Governor Brown himself has included in his own budget proposal, state worker salaries and benefits need to be lowered to competitive market rates. But making these reforms to put California into a situation of budget surpluses is only half the battle to revive California’s economy. At the same time, new government initiatives combined with new private investment – spurred by deregulation – are necessary to maximize the speed of California’s economic recovery, and lay the groundwork for a new golden age in the golden state.

Here are some projects – public or private or both – that will make California great again. They are based on a simple premise: It is the job of government to invest in infrastructure that will make energy, water and transportation less expensive, not more expensive.

(1) Build nuclear power plants: The latest generation of nuclear power technologies are safer than ever, and there is an abundant supply of nuclear fuel within North America. Adding a few nuclear power stations in California would have a dramatic impact on the price of electricity. Claims that nuclear [...] Read More

Balancing California’s Budget

Last week California’s incoming Governor Jerry Brown unveiled his proposed state budget for 2011. Despite the fact that Brown’s budget has deep cuts to nearly all state programs, the success of the budget – even if it should be approved by the state legislature – depends on tax rates staying the same. And California’s voters, regardless of whatever else their contrarian behavior may indicate, do not like taxes. If you read the Governor’s Budget Summary, on page 10 you can view the projected state general fund tax revenues – assuming voters approve an extension of the tax increases:

Also on page 10 of the Governor’s Budget Summary is a table showing the projected state general fund expenditures, already reflecting the proposed cuts to expenditures (note that the tables have been altered here for simplicity’s sake, such that only the column of numerical data showing the proposed amounts is retained). From comparing these tables, one will see the general fund according to these projections will enjoy a $5.0 billion surplus in the fiscal year 2011-12. But is Jerry Brown going far enough with his cuts? Because not only is California a state with some of the highest taxes in the U.S., but it is very likely voters will not approve extending the tax increases.

Areas where Brown did not propose cuts include pensions, and because state employee pension funds are not adequately funded, if [...] Read More

Pension Reform Proposals

Last year in a post entitled “Pension Reform Options,” the following suggestions were made – none of them terribly original – for ways to restore equity and sustainability to public sector pensions in California:

(1) Lower annual pension accrual to 1999 levels for new hires: (2) Lower annual pension accrual to 1999 levels going forward for existing (3) Reverse any retroactive pension accrual enhancement ever granted existing hires. (4) Retired public employees will see no change to their pension benefit. (5) Spread “final year” salary calculation over five years and eliminate “spiking.” (6) Establish ceiling on maximum pension benefit. (7) Raise eligible retirement age. (8) Reduce pension benefit by amount retiree earns in new job. (9) Eliminate tax-free or reduced tax pensions. (10) Aggregate multiple pensions under same ceiling. (11) Require conservative pension fund investment strategy. (12) Require public employees to contribute a fair share to their pension fund.

Last week a group advocating pension restructuring in California, the California Foundation for Fiscal Responsibility, published online two pension reform proposals. These proposals, put forward by experts on the issue, are interesting examples of what may be necessary in order to maintain pension solvency without either punitive tax increases or grotesque service cuts. They are also interesting because, along with including basic recommendations such the ones listed above, they include many nuances that most publicized pension reform proposals don’t cover. Because they are the product of in-depth analysis by [...] Read More

The Billionaire Givers Club

Last year two of the richest individuals in the world, Warren Buffet and Bill Gates, announced they intended to donate over 50% of their wealth to charity. Since that time at least 57 people, with an estimated total net worth of at least $320 billion, have joined this group. For more information, one may view their website “The Giving Pledge,” or view the Wikipedia data which includes links to biographical sketches on most of the group’s members including estimates of their individual net worth. Here are some of the well-known individuals who have signed The Giving Pledge:

It is hard to dispute the good intentions that undoubtedly motivate these altruistic decisions. But what happens if all the wealthy people in the United States decide to give away their fortunes, instead of subjecting them to the estate tax? How much revenue is denied the federal government by virtue of these decisions? The table below calculates that at the current marginal estate tax rate of 45%, if the current members of the billionaire givers club fulfill their pledges, at least $72 billion will be denied the federal treasury via the estate tax.

To put this in perspective, the next table calculates how much taxpayers who are not members of the billionaire givers club, those Americans who are neither billionaires, nor even millionaires, will have to pay in taxes in order to cover the $72 billion that the billionaire givers club [...] Read More

California’s Green Godfathers

It is an article of faith among environmentalists, conventional wisdom in the media and academia, and a massive delusion afflicting California’s voters, that the climate skeptic community receives massive backing from oil companies and other corporate “polluters.” But when you start to look at who stands to gain from climate “mitigation” policies, and really examine the money trail behind legislative lobbying and political campaigns, the notion that the money is on the side of the deniers doesn’t hold up.

Where the money really is in the global warming debate, as well as reasons why anthropogenic CO2 may not be pollution after all, has been explored at length already here in previous posts including Investigating Climate Alarmism, Credible Climate Skeptics, The Hijacked Public Interest in California, Public Sector Deficits & Global Warming “Mitigation”, California’s Proposition 23, Who Are The Carbon Criminals?, Implementing California’s Global Warming Act, The Climate Money Trail, and The Climate Alarm Industry. In this post, the intent is to take a closer look at who was behind the annihilation of California’s Prop. 23 last November, a citizens initiative that would have suspended implementation of California’s “Global Warming Act,” tepidly backed by a handful of oil companies (most [...] Read More