From the Times:
Details emerging from the talks suggested that the deal would require extraordinarily deep cuts to school systems and local governments, and, while far smaller than the governor threatened a month ago, substantial cuts to health care and other social services.Gov. Schwarzenegger and the state assembly are within millions, not billions, of dollars of reaching a deal, according to the article. The result will likely include a lot of social services cuts -- a waiting list for children's health care, Medicaid payments will be cut to their legal bare bones, some family welfare benefits could be scrapped, and so on -- and exactly zero tax increases.
The low-tax, low-services model that Texas has engendered in its state laboratory certainly has its benefits. As the Economist reported, Texas is the most popular state for Fortune 500 companies, and it receives top-notch business-friendly ratings. But, again, the other side having the lowest tax revenue raised per capita is that you have lowest amount of money to spend on services. Texas ranks last or next to last in the following categories:
Percentage of population with health insurance Source 50-1I don't know that California has a choice here. Not only is raising taxes political suicide in the state, but it's also practically stupid to do in the midst of a recession. So if you're not going to cut incoming revenue, you have to limit outgoing spending -- to the tune of billions of dollars, and to the detriment of education and social services. The California model is, indeed, fading, and the Lone Star state's philosophy is getting some company.
Percentage of high school graduates age 25 and over Source 50-2
[Percentage] of insured low-income children Source 50-3
Per capita spending on state arts agencies Source 49-2
Per capita spending on water quality Source 49-4
Amount of monthly Women, Infants, and Children (WIC) benefits paid Source 49-5
And of course, California's bloated public sector most likely won't see much if any layoffs of state and local employees. This is sad because these people are by far the most expensive part of the state budget. Instead, state employees will be "furloughed" - given a couple of days of foreced unpaid vacation each month. But after that vacation they'll be back in the office surfing the internet becuase they do not have any funds to put to use actually helping people. State employees will probably even protest this state of affairs and call for tax increases (only on the wealthy...). Of course, they will conveniently forget to mention that state agencies have to cut back on services beacause all of their allocated funds are going to paychecks and pensions. Thank you public sector unions!
So you still rely on an article entitled "Texas On The Brink", obviously written by some dufus liberal?
Even the things you list as BAD are not necessarily so.
WIC is welfare. Pay less and people might get a job.
Percapita spending on water is just a stupid measure. The water's either good or not, whether 3 or 3 million drink it.
Percapita spending on arts is the involuntary transfer of taxpayer money from payers to providers of the commodity that most people don't care about. If there was a market, it would not need subsidies.
Then you have these:
Percentage of population with health insurance Source 50-1
Percentage of high school graduates age 25 and over Source 50-2
[Percentage] of insured low-income children
Subtract the illegals and see what you have. Only Mexifornia has a bigger problem with illegals.
By the way, you left out - compared to your last post - the fact that TX pisses away far less money on public employees. That's especially important when comparing it to CA, NY, NJ, etc. where the public employee pigs run the place.
Why don't you try a more unbiased source, like the BLS. You might find that TX has the lowest unemployment of any major state - by quite a bit. You might find out that TX created more private sector jobs in 08 than the other states combined.
People with jobs tend to be a heck of a lot better off than the unemployed. There's a reason that TX is a favorite with those Fortune 500 companies - who all supply JOBS.
Hi Ed,
To be clear, my source was Texas Monthly. They used a statistics compendium called Texas on the Brink which compiles stats from, among other sources, the Census Bureau and the Texas Legislative budget. The author of the compendium is a Texas state representative, who is a Democrat.
I left out the fact that TX spends less money on public employees because I felt it was sort of redundant. If they tax less and spend less, of course their employees will make less. I found that less important, but it is, nonetheless, very true.
On the subject of Texas' employment, you're absolutely right! Texas has weathered this storm really well. I can't say whether that's entirely because of its favorable corporate tax rates, or because Exxon lives there, or because the state has seen stronger home prices, or some other factor. I haven't really done my research on Texas' job economy. My point in this piece is simpler: Cali could be moving toward a low-taxes/low-services model typified by Texas, which has the upside of not leaving you in a fiscal apocalypse and a downside of leaving you with little money to spend on social services.
If California actually closed the budget gap, I would be stunned. That hasn't been on the table in any of the discussions. Most of the reports sound like they are going to close maybe half of it, and then use accounting tricks to throw the rest into next year.
Be prepared to visit this story again in a few months, when they have to pass next years budget, and the situation looks even worse.
BTW, one reason California state employees are paid more is that real estate costs more here. That drives up the price of everything from groceries to government workers. The reason the real estate costs more is not a shortage however (most of California is empty.) It's NIMBY land-use regulations. I would love to see those changed now, while real estate is tanking anyway. They'll never do it during a recovery, since it would hurt land prices.
Including "Per capita spending on water quality" seems silly. Water quality standards are regulated by the Clean Water Act. Either the water meets the standards and doesn't have to be treated or it does. It's not a discretionary spending item. It is probably just that Texas has more water sources that meet the federal guidelines and do not need to be treated.
I am agree with this article that it's right California's bloated public sector most likely won't see much if any layoffs of state and local employees.Because local people are also part of the country and in my opinion very most part of the company.So govt. should care them.
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raj
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Real Estate--Real Estate