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California Declares Fiscal Emergency

The L.A. Times reports Governor Arnold Schwarzenegger “is scheduled to welcome the new [California] Legislature on Monday by declaring a fiscal emergency and ordering it into special session.”

Boy, it sure would be nice if we could deal with some of these fiscal problems before they explode into “emergencies.”  California has been storing highly flammable canisters of unsustainable spending in the basement for decades, while chasing away business with flaming torches made from bundles of expensive regulations and mandates.  As George Will put it, back in May 2009:

“Under Arnold Schwarzenegger, the best governor the states contiguous to California have ever had, people and businesses have been relocating to those states.  For four consecutive years, more Americans have moved out of California than have moved in. California’s business costs are more than 20 percent higher than the average state’s.  In the past decade, net out-migration of Americans has been 1.4 million. California is exporting talent while importing Mexico’s poverty. The latter is not California’s fault; the former is.

If, since 1990, state spending increases had been held to the inflation rate plus population growth, the state would have a $15 billion surplus instead of a $42 billion budget deficit, which is larger than the budgets of all but 10 states.  Since 1990, the number of state employees has increased by more than a third. In Schwarzenegger’s less than six years as governor, per capita government spending, adjusted for inflation, has increased nearly 20 percent.”

Why don’t we solve California’s problems with some of the same nostrums Barack Obama and the Democrat Party propose for the rest of the country?  Let’s soak the rich all through the Golden State.  What’s that, you say?  They’re already being soaked?  Well, tax them even more.  Confiscate their wealth, convert it to cash, and give it to the unemployed.  The unemployment rate in California was 12.4% as of last month.  That’s a fantastic opportunity to generate vast amounts of economic stimulus, by handing out cash to the seething horde of unemployed, who will create insane amounts of jobs when they spend it. 

Rich people don’t spend money, an idea rapidly approaching the status of religious faith on the Left.  Poor and unemployed people are the only ones who can spend money in a manner that will produce job growth and economic stimulus.  California is already one of the most redistributive states in the country, and it’s a basket case.  The obvious answer is to take redistribution even further.  There should be absolutely no negative side effects to heavier taxation, as liberals assure us rich people barely even notice the wealth seized from them through taxation.  Maybe they could get more cash from the billion-dollar motion picture industry, and its huge population of millionaire actors and directors.  I hear those guys get a lot of tax breaks.  Sounds like some loopholes are in need of closing!

Alas, a spokesman for Schwarzenegger said there would “be no tax increases.”  Instead, the state legislature should brace itself for “some ugly cuts.”  What madness is this?  Everyone knows the second most effective form of stimulus, after unemployment benefits, is massive spending by a benevolent government.  Is the Governor out of his mind?  Ugly cuts will cause the economy of California to collapse, as vast numbers of people simply stop moving altogether.  Some of them might even require medical assistance after they lose the will to breathe.

California doesn’t need any ruinous fiscal discipline.  If people out there stop believing money falls from the sky into the cornucopia of government, from which it is wisely and compassionately shared with the people according to their needs, money might stop falling from the sky.  It’s not as if the state can rely on investors and entrepreneurs to generate wealth and create jobs – they’ve been fleeing California for years.  I think what they really need out West is another speech from Barack Obama.  He knows exactly who need to be subsidized, and whose property can be safely taken away for the greater good of the people.

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Written By

John Hayward began his blogging career as a guest writer at Hot Air under the pen name "Doctor Zero," producing a collection of essays entitled Doctor Zero: Year One. He is a great admirer of free-market thinkers such as Arthur Laffer, Milton Friedman, and Thomas Sowell. He writes both political and cultural commentary, including book and movie reviews. An avid fan of horror and fantasy fiction, he has produced an e-book collection of short horror stories entitled Persistent Dread. John is a former staff writer for Human Events. He is a regular guest on the Rusty Humphries radio show, and has appeared on numerous other local and national radio programs, including G. Gordon Liddy, BattleLine, and Dennis Miller.

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