January 28, 2009
California Commentary
What Budget Crisis?
by Jon Coupal
Humans have been around for
tens of thousands of years. And
yet, as recently as a thousand
years ago, there was a broad
consensus -- even among the
most highly educated -- that the
world was flat. The problem with
"consensus" is that it becomes
groupthink. If an idea has no
challengers, it becomes difficult
to disprove and those who speak
against the established orthodoxy
are always marginalized.
There seems to be a
consensus in California that we
have a "Budget Crisis." But if
"crisis" is defined as a situation
where impending disaster is a
probable outcome -- think Cuban
Missile Crisis -- then the notion
that California is in the midst of
crisis needs to be challenged.
In support of the crisis mentality
for California's predicament is
the contention that California is
"going to run out of money" by
February. This is inaccurate for
two reasons. First, even with
significant reductions in tax
revenues to the state and local
governments, California remains
a tax producing behemoth.
Because of its $1.6 trillion
economy, California will generate
tens of billions of dollars more
than next-ranked Texas.
The distinct nature of
California's economy reveals
the second inaccuracy. It is not
California that is running out of
money, it is California government
that, more accurately, has a cash
flow-problem. And government
is going to run out of money only
if one assumes a continuation
of the rate of spending based
on previous years. But why
should we be forced to make this
assumption?
It is not a "crisis" if you are
merely driving down the freeway.
It is a crisis if you fail to slow
down when you get to your
exit. Reducing government
expenditures when revenues
decrease should be as natural
as slowing down a car when
approaching an off ramp ---and
we can do it without invoking the
"C" word.
You want a real crisis? Talk
to the folks at Circuit City and
Mervyns. Except for inventory
liquidations, there is no more
revenue coming in the door.
Could those corporations and
thousands of other small and
large businesses going through
bankruptcy have avoided this
fate with a ten or fifteen percent
reduction in revenue? Probably.
Although the vast majority of
Californians have indeed been
convinced that government is in
the midst of a budget crisis, our
political leaders have another
problem on their hands: Not
everyone cares. As recently
reported in the Sacramento Bee,
citizens are more concerned with
their own issues than with the
threat of a government shutdown.
It is not that they want failure, it is
• simply that they don't see a direct
impact on .them.
For that reason, and motivated
to ensure that the voting public
will resign itself to a tax increase,
our political leadership has taken
steps in an effort to engage --
or frighten -- the public. Sure,
if asked, the taxpaying public
would prefer that California
governments' books be balanced,
but the majority of citizens do not
rely directly on government for
their livelihoods.
The first scare tactic -- and
one targeted specifically at
the productive segment of our
population -- is the threat to pay
tax refunds with IOUs. But is this
really necessary? We have our
doubts.
It turns out that there exist in
the vaults of governments billions
of dollars of unused funds.
Whether it is redevelopment
money, excess revenue from the
tobacco tax or millionaires' tax,
the account balances of dozens
of funds under the control of the
state do not reflect the level of
poverty we are being told.
What is sorely needed now
is a healthy dose of skepticism
about the threats now being
issued by our State Controller,
State Treasurer and Director
of Finance. Just one question
illustrates this concern. We
have been told that, without a
resolution of the budget deficit,
California would be shut out of the
bond market. If that is true, then
how did California just recently
manage to sell almost $350.
million in Department of Water
Resource Bonds? Obviously,
someone still recognizes that
debt issuances by California are
a worthy investment.
All this is not to say
everything is coming up roses
in the Golden State..To the
contrary, government's rampant
overspending continues and
we indeed have a cash flow
problem. But let's not accept
without critical analysis a "cure"
for a problem that now appears
to be significantly overstated.
Jon Coupal is President of
the Howard Jarvis Taxpayers
Association -- California's largest
taxpayer organization -- which
is dedicated to the protection of
Proposition 13 and promoting
taxpayers' rights.
W ekly SUDOKU
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DIFFIC;ULTY THIS WEEK: *
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@2009 King Features Synd. Inc,
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The Julian News 13
Change Has
Come! Now
What?
Lucky T. Pettersen
JHS.Junior
January 20Th, a day that will
be remember for eons to come.
Despite a slight flub by the
Supreme Court's Chief Justice,
President Barack Obama took
the executive oath to finalize
what has been three months of
hard work and antici pation.
Perhaps this "transition to
power" has been the smoothest
witnessed in decades;
surprisingly to some, the Bush
administration passed the torch
seamlessly to the star-studded
Obama team. Despite minor
hindrances within the new
cabinet, such as tax evasion or
etc., it would seem as if the many
promises are sure to ensue.
With exception to the countless
balls, parades, and waltz's
following the inauguration,
Obama's first few days in office
have certainly been busy.
Rather than a haphazard settling
in process, there has been a
confident, swagger-like approach
to solving our great nation's
countless dilemmas.
For a younger high school
generation, this is the first time
an election has taken place
that has been understood and
debatable. Many students were
divided in their beliefs due to very
diverse motifs; but regardless of
ones choice it has certainly been
amazing to.see such intelligence
shared amongst peers.
In relation to this, it has
undoubtedly been an
unforgettable election for all who
have witnessed it. Regardless of
age, ethnicity, cultural/personal
beliefs, or even geographical
location this campaign will
Undoubtedly alter history.
.Perhaps these reasons truly
exemplify one of the superb
outcomes of this election, global
unity.
For many years America has
been frowned upon by much
of the world. However, at this
juncture faith has been restored
in the United States among many
countries, regardless of power.
To some, hope has not only
come to America, but to Earth.
At this crucial exigency in
American history it is crucial
that we as citizens support our
Commander in Chief.
Many voted for either Senator
McCain orfor Senator Obama, but
regardless of whether or not you
won or lost we must support our
President. To some, his choices
and beliefs may be questioned
and too extreme. Yet, if we truly
wish to lift ourselves out of this
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have chosen, despite party or
belief we as a nation must rally
behind the populace's choice
and support our democracy and
what it stands fbr. As stated
by Rudyard Kipling, "For the
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© 2009 King Features Synd., Inc.
As Heard On The Streets Of Julian ©
by Eric Stamets
Clinton Returns Computer Keys
To Obama
An 8 year old mystery about whether or not Presidents Clinton's
staff jokingly removed all the "W" keys from the White House
computers when George W. Bush moved in was solved when
President Obama's staff occupied the offices. On the first day, new
Secretary of State Hillary Clinton presented President Obama with
a plastic freezer bag full of "W" keys for various keyboards and said
that "Bill sent them." Up to now it had not been known if this had
been true or just was one of those silly things people make up on the
internet. Only now can we appreciate the severity that little practical
jokes can inadvertently cause. The typists that were responsible for
typing critical and classified re ports for the Bush administration found
their typing speed diminished because of the missing key and some
keyboards had a little metal pin that protruded up and hurt their left
I"Y- I-T- ring finger so much, that they had to wear a sewing thimble while
typing. The most im portant report that was slowed down was'the one
analyzing Iraq's "weapons of mass destruction" and the invasion was
launched before the report could be finished. In fact the rush draft
that was requested was hastily entitled "eapons of Mass Destruction"
and had the whole place in a tizzy and set the place back days while
they tried to figure out what "eapons" were. In the interest of fostering
newfound bi-partisan cooperation, President Bush proudly pointed
• out that his staff had not removed the "B" keys or the 'S"timulus keys
or even the "$" keys from the keyboards. He said, "It'll take them at
least a month to find out what we did."
R.ED. • by Mike MartaJ}d
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