Entries in California Economy (3)

Monday
08Feb2010

There Ought to be a Law

Californian's get what they vote for, unfortunately. Propsition 2, placing restrictions on how producers treat egg laying chickens, passed almost 2 to 1. Even the University of California before the 2008 election predicted the result would be the departure of the entire egg industry from California, just as we entered the worst economic decline since the Great Depression. Now there are reports that other states are licking their chops in hopes of providing a safe haven for our chicken industry.

This highlights the regularly reported lies regarding the exodus from California. We are exporting productive classes while retaining and growing the dependent classes. This cannot continue indefinitely. The wailing of the liberal-progressive-socialists about the income gap or growing class divide is only exacerbated by their policies. Unless you work in government, you should be preparing to seek opportunity elsewhere if the liberal-progressive-socialist-environmentalist agenda is passed. This is not extremist screed, it is a prediction based on ample experiences from elsewhere. 

Thursday
05Nov2009

Back to the Future

The California Legislature and Governor announced a huge success after years of trying, a victory of compromise that promised an abundant and less expensive resource necessary to modern living. The bill addressed every stakeholder’s needs, every politician’s pet pork project (although few had a chance to read the actual bill before passage): handshakes all around, off to a brighter future! The year was 1996, and the energy deregulation scheme proved a disaster for every rate payer in the State. A convincing argument could even be made that our subsequent economic anemia and current faltering recovery have their roots in the pseudo-deregulation of the electricity markets.

The Legislature and Governor have just announced the passage of another scheme making similar promises: water will be available to California’s homes, businesses, and farms for the foreseeable future, a new water czar agency will lead us to water plenty, the San Joaquin-Sacramento Delta will be protected and loved (fish got to swim, birds got to fly, I got to . . . ), water waste will be ended. The big difference is no one is even pretending its all going to be less expensive: its going to cost all of us more, much more. The bill passed at 6 a.m. with many members never having read or reviewed the legislation, does this sound familiar?

A centerpiece of the bill is an $11.1 billion bond measure on the November 2010 ballot. The bond measure would throw money around the State for any number of water supply, environmental improvement, and groundwater cleanup projects. These projects are the result of careful consideration of the State’s water needs and the hard choices forced upon negotiators by the State’s fiscal crisis. TRANSLATION: These projects are the pork doled out to various Legislaturalists to buy a vote.

Senate Minority Leader Dennis Hollingsworth thinks the State’s voters will will buy this pig in a poke:

"It's clearly the most significant investment in our water supply and water quality that we've seen in 40 or 50 years," said Hollingsworth, R-Murrieta, who has opposed past borrowing proposals as wasteful. “It's been carefully crafted fiscally where a fiscal conservative like me can support it.”

California is in decline by almost any measure, and we must fix our water supply problems if we are to remain a Golden State. Keep in mind that huge parts of this legislation are a sop to irrational environmentalists by their hacks in the Legislature. Before you make up your mind regarding this legislation, be sure to read Distorted Water put out by Rep Devin Nunes (R-CD21). Its an indispensible explanation of many of the water myths. California needs solutions to our looming water problem, but if this is the best that the Legislature can produce, we need to rethink more that just our position on this single bill.

Monday
19Oct2009

Killing the Goose that Lays the Golden Eggs?

Have we, or are we approaching, that moment when the California miracle ends (see Dan Walters’ column)? Are we busy poisoning the well at which we drink? Have we finally succeeding in killing the business cycle? To quote John Adams from 1776- “Is anybody there? Does anybody care?”- certainly not if you’re a member of the Democratic Majority.

Barbara Tuchman’s great and seminal work The March of Folly defines folly as

  • Pursuing policy and acts that are clearly contrary one’s self-interest,
  • Developed over time, not in a single burst of irrational behavior,
  • Pursued by whole groups of people, not a single wacko individual or leader, and
  • Known and recognized at the time.

Through the book she discusses four examples: the Trojan acceptance of the Greek Horse, the behavior of the Renaissance Popes, the British treatment of North America, and the United States adventure in Vietnam. This is reading well worth one’s time.

The Tuchman definition comes to mind as one considers the responses to the Varshney and Tootelian study (summary) regarding the economic effects of AB 32. The Sacramento Bee, staying with their avowed course of unprincipled liberalism, provide some typical reporting summarizing that the study does not fit with the liberal agenda and may contain some math errors: disregard it. Folly, pure folly. AB 32 will be like a great anchor on California’s economy: you cannot inject that much inefficiency into an economic system and expect it to perform.

Spain has done more to move to the “green” economy than any other industrialized nation. George Will reported on Gabriel Calzada’s study regarding the effects on employment. The Spanish Ministerio de Medio Ambient, y Medio Rural y Marino promptly fired back a response through a letter to Henry Waxman (D- CA) questioning methodology and mathematics.

Liberals hate it when actual analysis is applied to their supposed good intentions: Spain has predicted a 2010 unemployment rate of 22%. Have no doubt, Spain’s working class is happy to forego a prosperous lifestyle for possible medium and long-term benefits. Think folly.

These are lessons for California which we disregard at our own peril.