California Rejects Schwarzenegger’s Budget Measures

[ThePythonicCow]

Re: California Rejects Schwarzenegger’s Budget Measures

actually -

this is the real reason CA is now bankrupt:

Somehow I am confident that if all of Mexico had been an ocean rather than a bordering country, California would still have found the way to its present problems.

Note also that other states, such as Texas, also border on Mexico and are no doubt home to many illegal immigrants. However the Texas economy and government are doing rather well (or at least not so bad) right now.

I'm no fan of illegal immigration either (despite having hired such to tend the lawn of my California McMansion in a prior time.) However it is not the primary cause of California's sickness.

[hayekvindicated]

Re: California Rejects Schwarzenegger’s Budget Measures

Nice scapegoat, but the real real reason they're bankrupt is that they have financed too much through debt, and not enough through taxation.

http://www.dof.ca.gov/budgeting/budg...ts/CHART-K.pdf

Notice the massive interest cost of funding education ... all thanks to prop 13 (passed in 1978, after which K-12 state spending went on an exponential rise) which was a huge tax break for existing homeowners, destroyed the schools, and nailed new homeowners with some of the highest taxes in the nation.

This has been building for decades and is due to one reason: they charge everything and hope to pay for it later. (aka deficits don't matter)

Those costs include the cost of providing healthcare and education for illegal immigrants. The issues are inter-connected. And, tax receipts from illegal immigrants don't cover the costs - ergo, the costs get passed onto other taxpayers.

George Borjas wrote about this years ago.

[hayekvindicated]

Re: California Rejects Schwarzenegger’s Budget Measures

Somehow I am confident that if all of Mexico had been an ocean rather than a bordering country, California would still have found the way to its present problems.

Note also that other states, such as Texas, also border on Mexico and are no doubt home to many illegal immigrants. However the Texas economy and government are doing rather well (or at least not so bad) right now.

I'm no fan of illegal immigration either (despite having hired such to tend the lawn of my California McMansion in a prior time.) However it is not the primary cause of California's sickness.

Texas has a lot of oil and gas which California doesn't. Of course, a state can go bankrupt without a single immigrant - look at Iceland. But that doesn't mean the reverse is true - that immigrants have no impact on the finances of a state.

In California, the impact is at the extremes - highly skilled Asian labour has helped high tech industries whereas low wage Mexican labour has increased costs disproportionate to tax receipts from said low wage (mainly) Mexican labour.

[GRG55]

Re: California Rejects Schwarzenegger’s Budget Measures

Texas has a lot of oil and gas which California doesn't. Of course, a state can go bankrupt without a single immigrant - look at Iceland. But that doesn't mean the reverse is true - that immigrants have no impact on the finances of a state.

In California, the impact is at the extremes - highly skilled Asian labour has helped high tech industries whereas low wage Mexican labour has increased costs disproportionate to tax receipts from said low wage (mainly) Mexican labour.

Really? Show us the data to prove your assertion.

BTW, this is the exact argument that comes up repeatedly in the GCC every time there is a downturn...some idiot Finance Minister blames the problems on Philippino maids ripping off the economy because they send their savings home to the family. As you can probably tell, I think it's a BS argument in the GCC and I think it's most probably a BS argument in California also. But I would be happy to be proved wrong on the latter. You might start by showing us how much more the California agriculture industry could contribute to the state economy without the cheap labour...

[GRG55]

Re: California Rejects Schwarzenegger’s Budget Measures

Really? Show us the data to prove your assertion.

BTW, this is the exact argument that comes up repeatedly in the GCC every time there is a downturn...some idiot Finance Minister blames the problems on Philippino maids ripping off the economy because they send their savings home to the family. As you can probably tell, I think it's a BS argument in the GCC and I think it's most probably a BS argument in California also. But I would be happy to be proved wrong on the latter. You might start by showing us how much more the California agriculture industry could contribute to the state economy without the cheap labour...

And just maybe the compound effect of the 15% increase in General Fund actual expenditure in 2005/06 followed by another 11% increase in 2006/07 may have something to do with the current problem? I guess that massive increase must have gone to health care for illegals...

[hayekvindicated]

Re: California Rejects Schwarzenegger’s Budget Measures

And just maybe the compound effect of the 15% increase in General Fund actual expenditure in 2005/06 followed by another 11% increase in 2006/07 may have something to do with the current problem? I guess that massive increase must have gone to health care for illegals...

Don't get hysterical. Immigration can be discussed rationally like any other subject. For some, immigration hits a nerve and they have to be pro-immigration like a knee jerk reaction.

One can look at the facts coldly and objectively and form a view without hysterics. As I mentioned, George Borjas carried out a lot of research on this some time ago. There are stats aplenty all over the internet. But I have no desire to convert anyone to my point of view. Let people form their own opinions on the subject - and if you think immigration has no effect on California's finances, that's your prerogative.

I read extensively on the subject some four years ago. The figures already looked dire then. It is no coincidence that California has seen a massive flood of middle class people OUT of the state and into other parts of America in recent years. The cost of paying for the health and education costs has escalated in recent years and will in the years to come fall on a smaller and smaller tax base.

Time will judge who was right and who was wrong.

[hayekvindicated]

Re: California Rejects Schwarzenegger’s Budget Measures

Really? Show us the data to prove your assertion.

BTW, this is the exact argument that comes up repeatedly in the GCC every time there is a downturn...some idiot Finance Minister blames the problems on Philippino maids ripping off the economy because they send their savings home to the family. As you can probably tell, I think it's a BS argument in the GCC and I think it's most probably a BS argument in California also. But I would be happy to be proved wrong on the latter. You might start by showing us how much more the California agriculture industry could contribute to the state economy without the cheap labour...

What portion of California's GDP is agriculture? And what percentage of tax revenues come from agriculture? Labour intensive agriculture was never very efficient - if it had been the third world wouldn't be third world. The fact that some rich fat cats in agri business benefit from Mexican labour in no way implies that the country as a whole does - on a net basis.

[flintlock]

Re: California Rejects Schwarzenegger’s Budget Measures

And just maybe the compound effect of the 15% increase in General Fund actual expenditure in 2005/06 followed by another 11% increase in 2006/07 may have something to do with the current problem? I guess that massive increase must have gone to health care for illegals...

OK, or course illegal immigrants aren't the entire cause of California's problems, but it certainly aren't helping the situation right now. And its not just illegals. Any time you have too many people who are net drains on the state budget as opposed to net producers, you have a problem. This also applies to the elderly, the disabled, welfare, or any of a number of people receiving aid from social programs. It could also apply to some state workers. California simply doesn't have enough productive NET tax paying people to afford the high level of services they try to offer.

All societies have people who are a drag financially. It's when that segment gets too large that the problems start. Illegal immigrants are a part of that problem. The sick and elderly we are pretty much stuck with. As for the illegal immigrants....... Well that we have some control over.

[aaron]

Re: California Rejects Schwarzenegger’s Budget Measures

actually -

this is the real reason CA is now bankrupt:

http://www.latimes.com/news/local/la...,6444372.story

Meet Ms. Ana Puente

It is absolutely unbelievable that the state is paying 1.5 million plus to keep one kid alive. It is irrelevant whether that kid is illegal or not. It is a crime against humanity. 1.5 million dollars could be put to far better uses and save FAR more people.

[BadJuju]

Re: California Rejects Schwarzenegger’s Budget Measures

It is absolutely unbelievable that the state is paying 1.5 million plus to keep one kid alive. It is irrelevant whether that kid is illegal or not. It is a crime against humanity. 1.5 million dollars could be put to far better uses and save FAR more people.

I cannot imagine you saying that if it were you in that position. It is easy to be pragmatic when you are not the one that suffers at the hands of being given a dose of reality.

[audrey_girl]

Re: California Rejects Schwarzenegger’s Budget Measures

I cannot imagine you saying that if it were you in that position. It is easy to be pragmatic when you are not the one that suffers at the hands of being given a dose of reality.

Economics is all about the distribution of scare resources. No matter how hard we try to make believe, we as a society are all subject to limited resources.

Everyone here is sorry for this woman's plight - but 4 transplant operations all at the govt's expense?

perhaps a dose of reality will help show connections b/t making decision "a" and getting result "b":

For example, ...

that money could have helped keep one of the fire stations open they are now closing in CA - too bad that house burned down and elderly lady perished b/c it was closed on the day that fire occurred.

that money could have kept that after school program running in Oakland, too bad it wasn't available and they had to shut it down - a couple of poor kids then got caught up in gangs - one of them was shot and killed on Telegraph ave yesterday

that money could have helped hire a another police officer or two, too bad it wasn't around and we had to cut the positions. Last week there was another murder in my town

- you get the picture

[aaron]

Re: California Rejects Schwarzenegger’s Budget Measures

I cannot imagine you saying that if it were you in that position. It is easy to be pragmatic when you are not the one that suffers at the hands of being given a dose of reality.

If it was my kid I would do everything I could to get them the transplant. I would scream and cry and fight it as best I could. I would do anything. I am sure I would think the government was evil.. etc, etc. They are supposed to pay to keep my kid alive... because...

However, the reality is this:

People get sick and they die.
Health care costs money.
Life is not fair.

The state is SUPPOSED to think beyond the individual. They are supposed to take limited resources ($$$) and use it for maximum benefit to society. 1.5 million dollars can be used to save many lives. Hell, you can buy 100,000 courses of antibiotics for that.

[cjppjc]

Re: California Rejects Schwarzenegger’s Budget Measures

So I guess we are all in agreement regarding rationing healthcare.

[Raz]

Re: California Rejects Schwarzenegger’s Budget Measures

I didn't say it was a conservative state. On average it's centrist IMO. The reason they didn't go repub in recent elections is because the republicans have moved to the far-right.

Well yes, you DID say that it was a Conservative state - with a few pockets of Liberalism.
As to the Republicans moving to the "Far-Right": you've got to be kidding - or politically blind.
The Republicans lost power because they became the very same political hacks and whores that they managed to throw out back in 1994.

Other than his two appointments to the Supreme Court I can't find a lot of difference between Bush and the other huge failure of a president from Texas: Lyndon Baines Johnson. And he couldn't spell the word "conservative".

[Jay]

Re: California Rejects Schwarzenegger’s Budget Measures

The state would save much more money and lives if they put that money into preventative medicine. Health care is not an infinite resource unfortunately and not everyone can be saved. If you want to reduce costs, this is one example of rationing that would make sense among many, many others of course. Not an easy choice but it has to be made at some point otherwise you are living in fantasy.