Sunday, November 14, 2010

No bailouts please, we're Californians

By Lilac Sunday

It is a very difficult time to be a Republican in California.

Watching the Big Red Wave roll across the nation on November 2 was like watching a New Years Eve Party through a window. I am happy for you all, I really am, but California just voted itself into a nuclear winter.

In an act of collective amnesia, Jerry Moonbeam Brown was given a third term as Governor. San Francisco Mayor Gavin Newsom was elected Lieutenant Governor, Senator Boxer was given 6 more years to insult the military, and state and Congressional Democratic incumbents were overwhelmingly re-elected.

November 2nd's wound is being ripped open slowly. A handful of California races have been too close to call, but it now appears likely that California's 11th and 20th Congressional Districts will remain in Democratic hands. (I'm sorry, I'm so, so sorry.) In addition, San Francisco's District Attorney, who made a name for herself with the cases she refused to prosecute and the penalties she declined to seek, may very well be California's next Attorney General. (Note to self: stock up on ammo, because California's justice system is no longer in the business of protecting its residents.)

And then there is our budget. In October, after missing the state's Constitutional budgetary deadline by 100 days, Sacramento passed a budget that is already $6 billion in the hole, and the budget for fiscal year 2011-2012 is already projected to be $19 billion in the hole.

California is going to request a federal bailout, but California needs an infusion of cash like a junkie needs the needle. Don't give us any money, not one red cent. In order to break the state's cycle of political lunacy that is crippling the state with high taxes, high energy prices, and a hostile business climate, and whose overwhelmingly Democratic Congressional delegation is holding back necessary national reforms, California needs to hit bottom.

The good news is that, thanks to a couple of successful ballot initiatives, California may be closer to hitting bottom than ever before.

California law currently requires a two-thirds legislative supermajority vote to pass a budget, and every year the Republican legislative minority forms a firebreak against the Democratic majority's reflexive preference to prop up a bloated budget with tax increases. On November 2, the voters passed Proposition 25, which allows a budget to pass with a simple majority. The Republicans have lost the limited power of the supermajority, but now California's budget woes are squarely, and solely, in the hands of the Democrats in Sacramento. (It is arguable whether Prop 25 permits taxes to be raised with a simple majority or a supermajority, we'll have to wait and see.)

There is some suggestion that voters are beginning to lose patience with Sacramento's fiscal hijinks. On November 2nd, voters passed Proposition 22, which prevents the state from raiding local funds to close state budget gaps, and rejected Propositions 21 and 24, which would have increased the vehicle license fee and eliminated three pro-business tax treatments, respectively.

These results could be a glimmer of hope, or they could be the oncoming $50+ billion high speed rail boondoggle that California bureaucrats seem determined to build despite the lack of money, ridership, or community support.

California has been passing Potemkin budgets based on unrealistic fiscal scenarios and the promise of federal funds, but the deficit has grown so large that it cannot be papered over. Without a federal bailout, things are going to get very hard in California.

And that's the point. Lehman Brothers wasn't too big to fail, and neither is California. If California is ever going to free itself from the shackles of its tax-and-spend, nanny state, redistributive mentality, it needs to finally be fully exposed to the consequences of its own behavior, and it needs to be painful. I don't know whether California's nuclear winter will result in a voter awakening, some sort of receivership akin to bankruptcy, or riots in the streets, but something needs to happen. We cannot continue as we are.

Professor Jacobson at Legal Insurrection has warned you not to approach drowning Democrats. What I am asking you, for the good of the state and of the nation, is to please let California drown.

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