op-ed

California, the tax-and-spend zombie

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I’m living in California for the summer, and it’s sad to see how much the state is suffering. We’re broke, state income taxes are high, businesses are leaving in droves, the Republicans are completely overwhelmed in the state legislature … things are not good.

My home region of the San Joaquin Valley is taking hits on all sides, with an artificial years-long water shortage taking away farming jobs because liberal regulators care more about one-inch-long fish than they do about human beings. It’s gotten to the point where my parents are almost urging me not to work here (though I’d gladly take a job anywhere).

One of the interesting things about California politics is the progressive-era state referendum system, where a piece of legislation can be put directly before the people in a purely democratic vote. Some conservatives appreciate the system because it allows us to pass laws that could never make it through the perennially liberal-dominated legislature. Proposition 8, our law banning gay marriage, was passed through referendum back in 2008.

Nevertheless, the referendum system is a double-edged sword, subject to all the dangers of pure democracy. The fact is that people can be stupid, and can vote in their own foolish self-interest when it would be destructive to do so.

Exhibit A of the dangers of the referendum process is the moronic high-speed rail system that was approved by the voters of California in 2008 (actually, it was the same election where Proposition 8 was passed). California was in a bad financial situation in 2008; we are even worse off now. And yet, everybody is still charging ahead to construct this enormous, unnecessary piece of infrastructure that’s going to cost somewhere around $100 billion.

Did I mention that the state is broke? That we have no money? That we have negative money? And that we already have urgent infrastructural needs that are not being met — you know, like our prisons that are so crowded that the Supreme Court ordered the state to release 30,000 prisoners, on the grounds that their overcrowded conditions amounted to cruel and unusual punishment?

We have no money. And yet we spend and spend and spend and spend, and then blame the deficits and the debt on our lack of tax revenue — meaning we should probably raise taxes more, and then spend and spend some more.

The most aggravating part of the debate is that high-speed rail proponents claim that high-speed rail will create jobs in California. I do not understand how liberals can fail to see the concept that creating jobs through government programs is generally not very effective. Why? Well, unlike a private sector job, a government job almost never pays for itself in some revenue-creating fashion. It’s providing a service that is either partially or entirely subsidized by the government. Thus, in order to create this job, you need more governmental spending to pay for it. And guess what? Those workers are all going to go join a government employees’ union, who will negotiate some huge, fat pension plan for their members in exchange for the union promising to vote for Democrats forever and ever. That’s more government spending that’s not offset by revenue.

And guess where we have to make up the cost of all that spending? Ever-increasing taxation, which kills the state economy, drives people and businesses out of California, and is generally a huge bummer. For every one person who gets a nice, secure government job, there is a group of taxpayers (and taxpaying private-sector businesses) who have to pay for it with higher taxes, who are economically hindered by it, and who are, generally, hugely bummed out. Taxation limits the amount that businesses can expand and leads to businesses leaving the state and taking their jobs with them. With public-sector job creation, you’ve got a zero-sum game going on; it’s really a transfer of wealth from productive private-sector job-holders to far-less productive, subsidized government job-holders.

Many conservatives have argued that the modern American debt crisis has shown the ineffectiveness of Keynesian economics; the problem is, though, that liberal free-spenders in California don’t even follow Keynes, really. Keynesian theory of a “managed economy” encourages (1) reduced spending and increased taxes during economic booms to pay down debt, and (2) increased spending with decreased taxes during slowdowns to spur economic recovery.

But in California, all we do is spend, spend, spend, and tax, tax, tax regardless of whether the economy is booming or busting. We’re not truly Keynesians in California, but rather some kind of half-Keynesian zombie, lumbering around with an insatiable desire for more and more money to waste.

John Gerardi is a student at Notre Dame Law School. He writes on topics relating to religion and society. He blogs at Christifidelis Laicus.