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Thursday, January 13, 2005

The Critics Have Spoken 


There are two kinds of bad movies. Some, like Battlefield Earth or Plan 9 from Outer Space, are so exuberantly bad that it's almost worth suffering through them. Others are bad in a dull, miserable way, relieved only by the ease with which they are forgotten. Professor Tax had hoped that Governor Schwarzenegger’s new budget would be exuberantly bad, but those hopes have been disappointed. When the opening credits begin with the star/director/producer apologizing for the performance we’re about to watch, it doesn't take a Siskel & Ebert to know that what we’re about to endure should never have made it onto the screen. There are some punishments that not even a masochist could love.

Mature viewers (you’ve been warned!), can see the results for themselves:

The January 10th budget presentation (RealAudioMedia format)

The Department of Finance anti-ergonomic budget index

Other moviegoers may simply heed the one-star rating that was generously awarded by the nonpartisan Legislative Analyst. Her review found the new budget “has several positive attributes… but falls well short … targets relatively few major areas for reductions … places more spending on cruise control … proposals raise major concerns.”

Those who are tempted to go further and read the book will find that the '05-'06 state budget is a sad, sad piece of work. It has no self-respect. Last year Finance Director Donna Arduin took aggressive pride in slashing spending, but that has now given way to an apologetic whine -- "we're very sorry, but unfortunately we decided that we need to screw over the poor, the teachers and the civil servants". Instead of the imaginative fiscal tricks of the past, such as long-term bonds collateralized by hypothetical future savings, all we have today is: "Sneaking billions of dollars out of the school fund and the highway fund is very, very bad, so we're only going to do it for two more years, and to show we’re sorry here’s a new law to cut off the fingers of anyone who ever tries this again." It's the
Governor Gollum approach to public finance: "We hateses nasssty unionsss, yesss, Preciousss."

The only interesting aspect of the budget show was the new-found feistiness of the Sacramento press corps. Some of the news hacks seem to have shed their respectful awe of Arnold’s celebrity and are starting to ask intelligent questions. The reporters did not seem impressed by der Governor’s responses, which either repeated the clichés in his presentation script (“we have to live within our means… it’s not a tax problem, it’s a spending problem...”) or invoked his tough guy cinema persona to avoid substantive answers. Perhaps the charm is wearing thin, and someday the reporters will challenge ignorant falsehoods from Gov. Narcissinator just as they confront the lies other politicians tell.

Nor were the media particularly respectful when new budgetmeister Tom (“Uncle Scrooge”) Campbell came onstage in a supporting role as the prudent and parsimonious Angus McFrugal -- the sort of fellow who makes the eagle sing every time he spends a quarter. The reporters came close to trapping the canny Highlander into contradicting der Governor's ridiculous assertion that current formulas push spending up by $1.10 for every $1 of tax revenue. The questioners also were skeptical of the Thrifty Scot's unconvincing argument that the fix for all the bad voter initiative formulas and autopilots that snarl up rational state finance is to have the voters amend the constitution to add yet another autopilot formula. Indeed, one could almost hear the snickers when the press learned that the effective date of this measure would coincidently be delayed, so it would not start to operate 'til after the next gubernatorial election. In fact, Professor Tax suspects that the assembled news hacks saw right away that the Tartaned Tightwad's "reform" plan would completely paralyze the budget process, cut the purse-strings of legislative control, freeze California’s current tax structure for all time, and gradually devour the state's social fabric, from parks to universities, to fund the inexorable growth of the Medi-Cal monster.

It’s hard to find any amusement in this budget. There's only dour sermonizing on the Virtues of Wealth and Business, the Slippery Slope of Tax Increases, the Obligation to Provide for Oneself in Retirement and the Vices of Poverty and of the Poor. True, some may find unconscious irony in der Governor’s plan to
spend $6 million to combat obesity, while saving @ $140 million by slicing away at property tax relief for the low income elderly. One way or the other, this budget should slim the old folks down. Connoisseurs of Schadenfreude may also appreciate how Narcissus "loves and protects kids” by combining cuts (not just “failure to increase”, but real cuts) in Calworks payments to families in poverty with increased spending on medical care for poor kids. Such charity! “I love kids so much that I’ll take the money I save by starving them and spend it on doctors when they get sick.”

Pointy-headed intellectuals are always good for a laugh, so we find the state university folks fawning over der Governor for actually honoring his promise of a 3% cost-of-living raise, while overlooking the pension cost shuffle that may clip their take home pay by @4% - 5%. It's nice to see that Cal-PERS and the firefighters are not so absent-minded. But if you want to see high drama in the fight over the civil servant pension grab, you'll have to wait for the California Highway Patrol officers to appear on screen. Pension cost-sharing could carve as much as @16% - 20% out of their paychecks. Do you suppose they'll bring Eric Estrada back in time for the election commercials?




Comments:
Hi. Thanks for the insights. Please visit Finance Tips
 
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