Archaeologists from the 22nd Century Ponder the Death of California

Even though Chuck Asay is one of my favorite cartoonists (see here, here, here, here, and here), I was not a big fan of one of his recent two-frame cartoons.

But he has more than made up for that slight transgression with this new gem.

I’m biased, of course, since I’ve already written about California being the Greece of America, but there’s plenty of evidence to justify Asay’s cartoon.

• California already has some of the highest tax rates in America, resulting in Laffer Curve responses that reduce tax revenue.
• California has violated Mitchell’s Golden Rule, letting government spending grow faster than the productive sector of the economy.
• California over-compensates government employees, distorting labor markets and imposing ever-growing burdens on taxpayers.
• California is throwing good money after bad with subsidies for so-called high-speed rail.
• California is suffocating from a knee-jerk impulse for more red tape, regulation, and intervention in almost every area of life, from higher education to babysitting.

It’s hard to see how a state survives, in the long run, with such a burdensome government. While the cartoon is designed to be funny, it also make a valid point since the Golden State is copying the mistakes that are causing Greece to collapse.

That being said, California can be saved. I already mentioned this morning that voters in San Diego and San Jose voted overwhelmingly to trim the excessive benefits promised to government bureaucrats. But I also should have mentioned that California voters rejected a statewide referendum to boost tobacco taxes.

But the real test will be this November, when voters will be asked whether to vote for a huge income tax increase so that Governor Jerry Brown and the crowd in Sacramento can keep the gravy train rolling along for a few more years.

If voters resist the Washington-Monument-Syndrome demagoguery of the political elite and reject the class-warfare tax hike, then it’s possible that lawmakers will finally do the right thing and reduce the size and scope of California’s government.

I don’t think there’s any chance that California will become another Texas. But there’s a greater-than-zero chance that the state can pull itself back from the Grecian Abyss.

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Predicting the November Election (along with Thoughts on Wisconsin and California)

Since I’m a policy wonk and not a political prognosticator, I’m not sure why people keep asking me what will happen in the November elections. But since I got lucky with my 2010 predictions, I may as well throw in my two cents.

The election is now exactly five months away, so here’s my first cut at what will happen.

At this point, I am predicting an Obama victory, albeit by a much narrower margin than in 2008.

Given the weak economy and unpopularity of Obamacare, one might think Romney should be the favorite. However, the establishment media is completely in the tank for Obama and Romney is not exactly the strongest candidate, and I think those factors will tip the scales in November.

That being said, Obama has dropped from being a 60 percent-plus favorite on Intrade to just a 52.3 percent favorite in recent weeks, so GOP partisans have reasons to be hopeful.

Since all I care about is policy, I confess I’m not sure whether to be happy about my prediction. It all boils down to whether the “Richard Nixon Disinfectant Rule” applies to Romney. As of right now, we don’t know the answer. Here’s what I told ABC News earlier this week.

“The negative spin is that he’s said all these things to basically get past a conservative-leaning Republican Party electorate and that he’s really the Massachusetts moderate that some of his opponents tried to make him out to be,” said Dan Mitchell, a Cato economist… The flip side, Mitchell said, is that if Romney does stick to his promises to conservatives, they’ll be pleased when he gives support to Paul Ryan’s budget, takes steps to lower the spending-to-GDP ratio significantly, and offers states flexibility on spending Medicaid money.

We’ll have plenty of time between today and November 6 to analyze the presidential election, so let’s leave the national stage and take a look at what happened yesterday in Wisconsin and California.

We’ll start with California, because there were two very important – but largely overlooked – votes in San Diego and San Jose about curtailing lavish pensions for bureaucrats. The results were shocking, particularly since California is a left-wing state. Here’s part of the AP report.

Voters in two major California cities overwhelmingly approved cuts to retirement benefits for city workers in what supporters said was a mandate that may lead to similar ballot initiatives in other states and cities that are struggling with mounting pension obligations. Supporters had a simple message to voters in San Diego and San Jose: Pensions for city workers are unaffordable and more generous than many private companies offer… In San Diego, 66 percent voted in favor of Proposition B, while 34 percent were opposed. Nearly 97 percent of precincts were tallied by early Wednesday. The landslide was even bigger in San Jose, the nation’s 10th-largest city. With all precincts counted, 70 percent were in favor of Measure B and 30 percent were opposed.

Since I’ve written repeatedly about excessive compensation for government employees, these results are encouraging. Perhaps the gravy train has finally been derailed

Yesterday’s big election, though, was in Wisconsin. Republicans took control of the state in 2010 and enacted laws to restrain the power of union bureaucracies, which led to a counterattack by the left. First, there was a recall effort against Republicans in the State Senate and that failed. Then there was a recall against one of the GOP judges on the state’s Supreme Court, and that failed.

The climactic battle yesterday was to recall Governor Scott Walker. So how did that turn out? Let’s enjoy these excerpts from the Washington Post.

Wisconsin Gov. Scott Walker won a vote to keep his job on Tuesday, surviving a recall effort that turned the Republican into a conservative icon…That made Walker the first governor in U.S. history to survive a recall election; two others had failed. …the night provided a huge boost for Walker — as well as Republicans in Washington and state capitals who have embraced the same energetic, austere brand of fiscal conservatism as a solution for recession and debt. In a state known for a strong progressive tradition, Walker defended his policies against the full force of the labor movement and the modern left. And he won, again.

By the way, the final result in the Badger State was 53 percent-46 percent and I predicted 54 percent-46 percent, so I somewhat atoned for my awful guess on the Iowa caucuses.

P.S. This cartoon accurately shows what was at stake in Wisconsin.

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