Venice Beach Locked Down Except for Homeless Encampments

Apart from excursions to perform essential work or engage in essential activities, California’s 40 million residents have now been under house arrest for over a week. But in the homeless haven known as Venice Beach, the party hasn’t skipped a beat.

Law abiding residents have deserted the Los Angeles coast after a crackdown following a weekend of what mayor Eric Garcetti called people getting “too close together, too often,” Parking lots along the Los Angeles beaches are roped off. Along the boardwalk in Venice Beach, all the businesses are closed.

None of these new rules seem to apply to the homeless. Whatever minimal law enforcement still existed in Venice Beach prior to the COVID-19 outbreak has diminished further, and more tents than ever have appeared on the boardwalk and along the streets.

It’s important to recognize that some of California’s homeless are victims of circumstances beyond their control, who want to work, who have to care for young children, who stay sober, who obey the laws. But not sufficiently acknowledged by agenda driven politicians and compassionate care bureaucrats is the fact that most of these homeless find shelter.

The vast majority of homeless that remain unsheltered, especially in places like Venice Beach, are either drug addicts, alcoholics, mentally ill, or criminals. None of these people belong on the streets, not now, and not ever. There is not a homeless crisis or housing crisis in Venice Beach so much as a drug crisis, an alcoholism crisis, a mental health crisis, […] Read More

Time for California’s Unions to Get Serious About Pension Reform

There was a time, long long ago, when California’s pension systems were responsibly managed. They made conservative investments, they paid modest but fair benefits to retirees, and they didn’t place an unreasonable financial burden on taxpayers. But a series of decisions and circumstances over the past thirty years put these pension systems on a collision course with financial disaster. And like hybrid war, or creeping fascism, or a progressive, initially asymptomatic disease, it is impossible to say exactly when these pension systems crossed the line from health to sickness.

An excellent history of how California’s public employee pension systems moved inexorably towards the predicament they’re now in can be found in a City Journal article entitled “The Pension Fund That Ate California.” Written in 2013, when California’s pension systems were still coping with the impact of the Great Recession, author Steven Malanga identifies key milestones: The power of public sector unions that began to make itself felt starting in the late 1960s. The pension benefit enhancements that began in the 1970s. The growing power of the union representatives on the pension fund boards. Prop. 21, passed in 1984, which allowed the pension systems to invest in riskier asset classes.

The biggest milestone on the road to sickness, however, began in 1999, as Malanga writes, “when union-backed Gray Davis became governor and union-backed Phil Angelides became state treasurer, and the CalPERS board was wearing a union label.” The state legislation that followed, mimicked by local measures across California, dramatically increased […] Read More

Grassroots Infrastructure for Initiatives and Recalls is Growing in California

Earlier this month the effort to recall Gavin Newsom was officially ended. As reported in the Times of San Diego on March 17, “Last week, the California Secretary of State’s Office informed Erin Cruz of Palm Springs that her petition effort to oust the Democratic governor had failed.

A year earlier, an initiative to repeal California’s gas tax made it onto the ballot, only to be defeated in the general election of November 2018. These represent two significant failures on the part of populist conservative reformers in California. But the story of these two failed attempts at change should not dishearten activists.

The ability for underfunded, technologically savvy groups of activists to use the initiative and referendum process to attempt fundamental change in California is a mega-trend that has just begun. It represents an existential threat to California’s ruling establishment. Without major donors, without support from political parties or the media, a movement has formed that does not yet realize its power.

The Recall Gavin petition drive was launched by author and current congressional candidate Erin Cruz and a core group of committed activists. Within 150 days they had to attempt to gather a daunting 1,495,709 signatures. They ended up collecting a gross total of 352,271 signed petitions, of which 281,917 were verified and valid. This may not have been nearly enough to put a recall onto a statewide ballot, but it is nonetheless an astonishing and record-setting achievement, because they did this with nothing. No significant […] Read More

Taking Back California

AUDIO: An attempt to understand the financial challenges now facing California’s cities and counties, an exploration of possible citizen ballot initiatives that might help make California affordable again (and solvent), and ideas for how to make that happen – 49 minutes on KTIE San Bernardino – Edward Ring on the Unite Inland Empire radio show.

http://civfi.com/wp-content/uploads/2020/03/2020-03-20-Edward-Ring-on-Unite-IE-Radio-49-minutes-KTIE-San-Bernardino.mp3

 

How Much Water Went Into Growing the Food We Eat?

The rains bypassed sunny California in January and February 2020, encouraging talk of another drought. California’s last drought was only declared over a year ago, after two wet winters in a row filled the states reservoirs. To cope with the last drought, instead of building more reservoirs and taking other measures to increase the supply of water, California’s policymakers imposed permanent rationing.

This predictable response ignores obvious solutions. Millions of acre feet of storm runoff can not only be stored in new reservoirs, but in underground aquifers with massive unused capacity. Additional millions of acre feet can be recovered by treating and reusing wastewater, and by joining the rest of the developed nations living in arid climates who have turned to large scale desalination.

All of this, however, would require a change in philosophy from one of micromanagement of demand to one that emphasizes increasing supply. To understand why a focus on increasing supply is vastly preferable to reducing demand, it helps to know just how much water California’s urban residents consume compared to other users.

As a matter of fact, the average California household purchases a relatively trivial amount of water from their utility, when compared to how much water they purchase in the form of the food they eat. For this reason, reducing residential water consumption will not make much of a difference when it comes to mitigating the effects of a prolonged drought.

To illustrate this point, it is necessary to determine just how much water […] Read More

California Cities in Critical Condition

The specter of California’s cities and counties becoming insolvent is nothing new. Three major California cities have already declared bankruptcy, Vallejo in 2008, Stockton and San Bernardino in 2012. In October 2019, the California State Auditor’s Office reported on the fiscal health of 471 California cities.

On what the California State Auditor’s office describes as a “Local Government High Risk Dashboard,” they identified 18 high risk communities: Compton, Atwater, Blythe, Lindsay, Calexico, San Fernando, El Cerrito, San Gabriel, Maywood, Monrovia, Vernon, Richmond, Oakland, Ione, Del Rey Oaks, Marysville, West Covina, and La Habra.

This so-called “dashboard” includes data for all the 471 cities on financial variables such as liquidity, debt, reserves, pensions and other retirement benefits. It also provides an excellent map. On this zoomed in segment, the financially troubled cities of (from north to south) Richmond and El Cerrito (contiguous), and Oakland can be seen highlighted in red.

Southern California also has its share of financially troubled cities, as shown on the next map segment taken from the California State Auditor’s dashboard. Clockwise, starting from the top, the most financially endangered cities are Monrovia, West Covina, La Habra, Compton, Vernon and Commerce (contiguous), and San Gabriel.

Back in October 2019 when the California State Auditor warned Californians about 18 cities in immediate financial peril, the overall economic situation looked very different than it does today. And at that time, articles that reported on the auditor’s warning published by Reason, Governing, […] Read More

Sustainable Megacities

Modern urban centers around the world now have neighborhoods that house well over 100,000 people per square mile. The Choa Chu Kang district in Singapore, defined by boulevards lined with 10 to 12 story mid-rise residential buildings, has a population density of more than 125,000 people per square mile. The entire borough of Manhattan has an average population density of more than 70,000 people per square mile, with far higher densities in areas of midtown and lower Manhattan.

According to a 2018 report released by the United Nations, today 55 percent of the world’s population lives in urban areas, a proportion that is estimated to increase to 68 percent by 2050. At the same time, the United Nations projects the global population to increase from 7.8 billion today to 9.7 billion by 2050. These projections lead to a surprising calculation: the absolute number of people living in rural areas is expected to decline, from 3.5 billion today to only 3.1 billion in 2050.

What should not be surprising by now is that people around the world, voluntarily and inexorably, are migrating from rural areas to cities. But the corollary effect is relatively unheralded; that around the world, open land is slowly depopulating. For the most part, this is happening absent government coercion. It flies in the face of the conventional wisdom—heard endlessly in the United States—that we are running out of open space. We aren’t.

If we have a sustainability challenge, it is not […] Read More

Government Pensions Are Dividing Americans and Damaging the Economy

Now that financial markets around the world are experiencing a long-overdue correction, the best we can hope for is that we hit bottom before a deflationary cascade causes a worldwide depression. Those economists who believe in the long-term debt cycle may claim that this time the end has arrived, and they may be right. COVID-19, oil price wars, traders and investors hating Trump—these are just pinpricks. This bubble has been inflating for decades.

There have been plenty of warnings. Interest rates at near zero in the United States and actually negative in European nations. Record borrowing by the federal government, and, possibly worse, record levels of consumer debt. Corporate borrowing to buy back stock instead of invest in R&D and plant modernization.

In January 2000, at the peak of the internet bubble, total credit market debt in the U.S. was $27.8 trillion. By October 2007, at the peak of the housing bubble, total debt had climbed to $51.4 trillion. As of October 31, 2019, the most recent period for which data is available, total debt had climbed to $73.4 trillion.

Debt accumulation is not a sustainable way to stimulate growth. At some point, there is not a mere “correction,” such as what was seen in 2000 and 2008, but a fundamental restructuring of the financial economy of nations, such as happened in the 1930s. Has that reckoning arrived?

Either way, as of close on March 12, the Dow Jones had given up nearly three years of […] Read More

Deep Pocket Democrats Intend to Buy Congress

Michael Bloomberg made a stunning admission last month during his second appearance in a Democratic presidential primary debate. Speaking in defense of his new identity as a member of the Democratic Party, he said, “All of the new Democrats that came in, put Nancy Pelosi in charge, and gave the Congress the ability to control this president, I b . . . bought . . . I got them.”

Indeed he did. He bought them.

Bloomberg bought congressional seats in 2018, spending an estimated $110 million to help Democrats win. This included $28 million through his super PAC Independence USA, which backed 22 Democratic congressional candidates, 19 of whom won. These efforts promise to be minor compared to what is happening now.

And the scale of his spending in the 2020 political season, especially when matched with the ongoing torrents of cash coming from other Democratic megadonors, dwarfs anything we’ve ever seen in American politics. With an estimated net worth of nearly $60 billion, Bloomberg may be out of the presidential race but he still has money to burn.

Starting in early 2019, in fact, Bloomberg began building what The Atlantic described as “the most powerful political organization in America,” which will “collect data about voters on an unprecedented scale, match those data with consumer data, and then hire a team of engineers to do high-level analyses, looking for new ways to identify potential voters, and new ways to appeal to them. They want to […] Read More

Californians Reject New Taxes and Borrowing

The preliminary election returns reported on March 4th – the day after the election, and the day when we used to get final returns – indicate that California’s voters delivered a stunning rejection of new taxes and borrowing. It’s about time.

At the state level, Prop.13 which would have authorized $15 billion in general obligation bonds for schools and colleges, required a simple majority for approval. But as of March 9th the “yes” votes only stood at 45.6 percent. This is unprecedented. As reported by Cal Matters, “since 1998 voters have passed five state school bonds, including a $9 billion measure in 2016 that Gov. Jerry Brown opposed.”

While Prop. 13’s likely failure is surprising enough, the dismal fate of hundreds of local bond and tax proposals indicates a broader shift in California’s electorate. One state school bond may fail for various reasons, but that’s only one data point. On the other hand, California had 121 local school bonds on the March 3 ballot. The returns on March 4th had 86 of them falling short of the 55 percent threshold necessary for passage, nearly 70 percent. That’s a lot of data points.

Local taxes didn’t do much better. Of the 111 local tax measures proposed, voters as of March 4 were rejecting 65 of them, or nearly 60 percent. The table depicted below uses data compiled by CalTax as of March 4th. It shows that local school bonds, had all of them been accepted by voters, would have […] Read More