Case study in Republican insanity: California to go belly-up?

[Zkribbler]

Why limit it to only one? The entire prop system should go into the trash.

QFTMFT!!

[Zkribbler]

The California economy is in the crapper. Meanwhile, the state has been spending beyond its means.

Most other states are required by their constitutions to balance their budgets every year, so they have had to respond more quickly with spending cuts than has California. Apparently, California has taken a more leisurely pace of cuts by borrowing.

The irony? We've always had a balanced-budget mandated by our Constitution. After Arnold got elected, he passed a SECOND such constitutional requirement. Both requirements have been consistently ignored.

[Berzerker]

So in some cases it's okay to punish someone before they've been convicted?

We do it all the time, poor people cant make bail they sit in jail

And so presumably they took steps to make sure that doesn't almost happen again. None of which necessitates sending him to jail.

He violated the terms of his house arrest. He's a thief and we let him hide some of the loot because he was not a "threat" to anyone... Just his victims.

[Lefty Scaevola]

CA has overspent and high taxed for decades, leaving no room to adjust revenue in a downturn. Furthermore, their tax structure was very heavily top loaded at higher income and capital gains, which proportionally dropped much more in the recession than a typical broader state tax base, savaging their tax base and demanding much higher adjustment than other states face. When your state finances sail on the edge for so many years, you are bound to fall over when a big crunch comes.

[Zkribbler]

Direct democracy works fine as long as you have an educated public. Direct democracy plus private financing means that really bad policies that favor the rich get passed.

Direct democracy means people vote for the side with the slickest ads. Vote for no tax increases, better schools, more criminals in prison longer, better levies, and more highways [and for God's sakes, don't do the math! ].

[Imran Siddiqui]

AFAICT CA could do that immediately. Of course, administering the balloting would itself cost millions that the state doesn't, you know, have.

So... epic fail?

[Dinner]

They need to write a budget that will garner the necessary votes. Pretty simple.

They actually had it until right wing radio nuts staged a protest at the office of one Republican moderate telling him they'd attempt to use the state's recall system (which both parties have used to target politicians who don't tow the party line) on any Republican who voted for any bill which included any tax increases. It's virtually impossible to cut enough spending to cover the almost $41 billion deficit because such massive amounts of the budget have already been made mandatory by voters (education alone is legally required to get 50% of all state tax revenue with some 2-3 dozen other mandatory spending measures spending measures having been passed over the last 40 years). Everyone always votes for propositions to increase spending while also voting for propositions to cut taxes. It doesn't take a genius to realize this causes deficits.

The other major problem is the constitutional "reforms" passed by Republicans in the early 80's which made it so super majorities are required to raise any taxes or cut any spending but only requiring a simple majority to add new spending. This has caused huge gridlock in the state government.

[Ben Kenobi]

You should be able to short states just like you do other stocks.

Shorting California would be awesome.

[Lancer]

Why do they have such a large deficit?

California iirc has about as large an economy as Germany but unfortunately they are almost completely lacking in Germans. (fiscal conservatives)

[Dinner]

or get this. They do what my state does and cut the state budget enough to create a balanced budget.

don't tell me a state as big as Cali doesn't have plenty of pork to cut.

Some 70%-75% of the state budget has now been mandated by voters via the proposition system meaning the legislature can't cut voter mandated programs even if they wanted to. That's just the way many of these propositions voters have passed were written. You tell me, how do you balance a budget deficit of some 35%-40% when your entire discretionary budget only amounts to 25%-30%? Do you close all prisons and stop maintaining every road? Even if ALL discretionary spending were eliminated the budget still wouldn't be balanced so you simply have to raise taxes. No ifs, ands, or buts.

Still, the situation isn't as bad as some would have you think. Taxes were cut a lot in the late 90's and early 00's so that even this proposed tax increase (along with an equivalent amount of spending cuts) would still mean everyone would pay lower taxes then 10 years ago. Not nearly as bad as some have made out.

[Dinner]

CA has overspent and high taxed for decades, leaving no room to adjust revenue in a downturn. Furthermore, their tax structure was very heavily top loaded at higher income and capital gains, which proportionally dropped much more in the recession than a typical broader state tax base, savaging their tax base and demanding much higher adjustment than other states face. When your state finances sail on the edge for so many years, you are bound to fall over when a big crunch comes.

Capital gains are hardly an issue in this state since there are so many exemptions made into the law. For instance each year a person can sell a house (each and every year) and the first $500,000 in capital gains are completely free of the state capital gains tax. The only people who pay any state capital gains tax are people who realize more then $500,000 in capital gains per year; at least on real estate though there are similar exemptions out there for lots of other items.

[Darius871]

So... epic fail?

Indeed.

[notyoueither]

California iirc has about as large an economy as Germany but unfortunately they are almost completely lacking in Germans.

[notyoueither]

Some 70%-75% of the state budget has now been mandated by voters via the proposition system meaning the legislature can't cut voter mandated programs even if they wanted to. That's just the way many of these propositions voters have passed were written. You tell me, how do you balance a budget deficit of some 35%-40% when your entire discretionary budget only amounts to 25%-30%? Do you close all prisons and stop maintaining every road? Even if ALL discretionary spending were eliminated the budget still wouldn't be balanced so you simply have to raise taxes. No ifs, ands, or buts.

Still, the situation isn't as bad as some would have you think. Taxes were cut a lot in the late 90's and early 00's so that even this proposed tax increase (along with an equivalent amount of spending cuts) would still mean everyone would pay lower taxes then 10 years ago. Not nearly as bad as some have made out.

Ignore the props instead of the Constitution.

[Zkribbler]

You should be able to short states just like you do other stocks.

Shorting California would be awesome.

We already have the lowest bond rating of any State.

We're terminating teachers, cutting off disablity payments, turning loose 1/3 of our prison inmates, and closing down state offices a couple of time per month. And the Repugs keep crying: "You have to cut out more pork!"

Ignore the props instead of the Constitution.

Oh yeah, and we're transferring funds out of specialized funds -- in violation of the Constitution -- and moving them to the General Fund.