California an economic model? Not quite

California an economic model? Not quite

By Dan Walters | Sept. 23, 2018 | COMMENTARY, DAN WALTERS






A significant sub-theme of Gov. Jerry Brown’s climate change conference in San Francisco this month was that California is a living model of how a nation-state can go green while experiencing economic prosperity.

Some Californians take it a step further, contending that going green is itself an economic spur.

Certainly California’s current economy is, at least superficially, booming.

The state’s official unemployment rate is 4.2 percent, a record-low level, reflecting tens of thousands of new jobs being added each month – nearly 50,000 in July alone, according to the most recent employment report.

California’s total economic output is more than $2.5 trillion a year, which would place it fifth in the world were it a nation.

However, the claims that California is a model of green prosperity are somewhat overblown.

California is prospering these days mostly because the nation as a whole is experiencing a record-long economic expansion. The steps it has taken so far to reduce its carbon footprint have been relatively mild, so their economic impact, positive or negative, has been relatively scant.

The contentions that going green has been an economic positive are unproven. The cheerleaders for that claim notoriously overcount “green jobs,” including many that would exist regardless and discounting the jobs that might be lost in the conversion.

The biggest negative about the state’s economic standing, however, came in a new report issued by the Census Bureau as Brown’s conference was underway.

It was the bureau’s updated report on poverty and once again, California found itself in the unenviable position of being No. 1 in that category when all economic factors are included in the calculation.

While the state’s poverty rate by the Census Bureau’s “supplemental” method declined slightly since the previous report, it still is the nation’s highest at 19 percent and that’s because of California’s very high cost of living, particularly for housing.

That means 7.5 million Californians, more than the population of most states, are counted as poor. And the situation is even darker when other data are put into the mix.

The Public Policy Institute of California, using a methodology similar to that of the Census Bureau, came up with very similar results, but also calculated that another 20 percent or so of Californians are living in “near-poverty.”

Adding the near-poor to the total brings us to about 16 million Californians struggling to survive. That number is bolstered by the fact that 14 million Californians are being covered by the state’s Medi-Cal program of medical care for the poor and the number would probably climb to 16 million if undocumented immigrants were eligible for its benefits.

Finally, the state’s record-low unemployment rate is also somewhat misleading. The jobless rate most often cited – 4.2 percent currently – is the percentage of those considered to be in the workforce who lack jobs. But that doesn’t account for adults who, for one reason or another, don’t work or seek work, nor those who are working only part-time and/or below their skill levels.

The Bureau of Labor Statistics actually calculates unemployment and underemployment six different ways and the most revealing, called “U-6,” includes not only the officially unemployed but “marginally attached” workers and those involuntarily working part-time. California’s U-6 rate is 9.2 percent, more than a full percentage point higher than the national rate and tied with Louisiana for the sixth highest.

Until its real poverty rate and its real unemployment rate drop at least to the national average no one, especially no politician, should be boasting of California’s prosperity.

Budget trailer bills have become Christmas trees

Budget trailer bills have become Christmas trees

By Dan Walters | June 20, 2018 | Commentary


As detailed in this space a few days ago, the Legislature is using a budget “trailer bill” to deprive voters of vital information about local government and school bond issues.

The legislation, drafted without public hearings or other input, would suspend for two years a new law, which took effect on January 1, requiring proposed bond measures to reveal to voters how they would affect property tax bills.

The local officials who sought the suspension apparently believe that revealing the tax consequences to voters would make them less likely to vote for bond issues.

Sadly, however, it is not an isolated example of how the Capitol’s politicians are misusing trailer bills, meant to implement the state budget, to enact far-reaching policies that have virtually nothing to do with the budget, and without any of the traditional safeguards, such as waiting periods and public hearings.

Take, for example, one provision in a trailer bill devoted mostly to the state’s health care services.

It would make immense changes in how those believed to be mentally ill are treated in the criminal justice system, essentially making “diversions” out of the courts and into treatment much easier.

It’s a serious topic that deserves to be treated seriously and, in fact, legislation to reform diversions was already moving through the Legislature with input from all of the authorities and outside interest groups.

Suddenly, however, the trailer bill popped up late last week, short-circuiting the legislative process and drawing ire from the California District Attorneys Association both on its substance and its sneakiness.

“Simply put, diversion would be available for any crime,” the prosecutors complained in a “budget alert,” adding, “Additionally there are no limits on the number of times someone can receive diversion under this scheme, nor would anyone be excluded based on their criminal history.”

A broader example of how trailer bills are being misused is the one labeled “general government and public employment.”

California’s public employee unions, who are joined at the hip with the Legislature’s dominant Democrats, are very worried about a pending U.S. Supreme Court case that would ban them from collecting partial dues from non-members.

In anticipation of the decision, which is likely to be issued this month, union-friendly legislators have carried new laws to minimize its effects, such as requiring new employees to attend “orientation meetings” aimed at persuading them to join unions and giving unions access to employee contact information that no one else – especially anti-union groups – could have.

The newest effort would make the location of those orientation meetings a secret, expand the ability of unions to seek deduction of dues, make it somewhat more difficult for employees to opt-out of payments and expand the public agencies whose workers are subject to dues deductions.

The secret meeting provisions are drawing criticism from the California News Publishers Association (disclosure: CALmatters is a member), which zealously defends the state’s open records and open meeting “sunshine” laws. The CNPA calls it “a limitation on the public’s right of access with no discernible public benefit.”

There are many other questionable provisions in the 26 budget trailer bills. They have become legislative Christmas trees, festooned with ornamental goodies for those with political pull that should be aired fully and publicly, not drafted in the dead of night and enacted with minimal notice.