The Grinch that Stole CA’s Christmas
by WAYNE LUSVARDI
Dr. Seuss’s children’s story, “The Grinch That Stole Christmas,” applies to California in 2011.
Seuss’s story is about an unhappy cave-dwelling creature with an undersized heart that lives on Mt. Crumpit just north of Whoville — home of the “Whos.” The Grinch becomes annoyed with the Christmas happiness he hears taking place in Whoville. Eventually, the Grinch makes plans to take their Christmas presents and decorations from them. The Grinch becomes resolved to “prevent Christmas from coming.”
The Grinch succeeds in confiscating everyone’s presents. Nevertheless, Christmas can’t be denied and arrives.
In Seuss’s story, those who celebrate Christmas soften the Grinch. His heart grows in size. He eventually returns all the gifts and decorations. He joins the community of the “Whos.”
In the California version of Seuss’s tale, however, Gov. Jerry Brown and his fellow grinches in the state legislature set about to take presents from next year’s Christmas as well. This plan includes placing on the November 2012 ballot several initiatives to raise taxes to purportedly reduce the budget deficit.
Consider the following budget items that presently take from everyone’s Christmas but add to the $20 billion state structural budget deficit:
1. The reported $6 billion in above-market power costs, according to the Division of Ratepayer Advocates of the California Public Utilities Commission.
2. The proposed elimination and changes to $3.3 billion in tax credits, deductions and exemptions, as recommended by the State Legislative Analyst’s Office. The LAO “selected tax credits or exemptions for reductions or elimination because they are not achieving their stated purposes or are of lower priority.”
3. The estimated $2.75 billion it would cost to pay interest on water bonds, including the proposed $11.1 billion new water bond for the November 2012 ballot. These existing and proposed new water bonds would be unnecessary if the 2 million acre feet of contracted water per year from the California Aqueduct was allowed by cities to flow to California’s farms and cities.
4. The estimated $2 billion in additional costs to issue lease-revenue bonds instead of general obligation bonds to build new court-ordered prisons. The use of lease-obligation bonds goes around the requirement for voter approval of debt under Proposition 13.
5. The $527 million in overspending by community colleges, as reported by the State Controller in the Statement of General Fund Cash Receipts and Disbursements of Oct. 2011
6. The roughly $300 million in interest on stem-cell research bonds per year for a total of about $1 billion over the three-year authorization under Proposition 71. Public funding of stem cell research is duplicative to funding by the private sector and the National Institutes of Health.
7. The more than $1 billion in lost output, more than 6,000 lost jobs, $425 million in lost labor income and $49 million in lost taxes from the Obama administration’s Environmental Protection Agency delaying the implementation of fracking — oil and gas extraction by fracturing rock formations — in California, according to a study by the Los Angeles Economic Development Corporation.
8. The $62.5 million per year siphoned from electric utility bills and $24 million per year from natural gas bills via the Public Interest Energy Research surcharge that has accomplished nothing since 1996.
9. The $7.4 billion in potential cost savings in categorical or “earmarked” items in the K-12 Education Budget identified in the 2008 report, titled “Categorical Reform,” by the State Legislative Analyst. Gov. Jerry Brown only cut 1 percent of the budget for categorical programs in 2010 and slightly increased the 2011-12 school budget by $2 million.
Taxes = More Bureaucracy
There are those who say the budget deficit can only be plugged by increasing taxes. But in California more taxes have only gone to increase the size of bureaucracies and boost public pension benefits, thus fueling the deficit and the long-term debt. Witness the tsunami of money from the Real Estate Bubble and the $50 billion from the Federal Stimulus funds spent in California to date. Did any of it reduce the budget deficit or debt?
Neither Gov. Brown nor the legislature is about to let Californians have Christmas without stealing a few presents and Christmas tree decorations that do nothing to plug the state budget deficit.
That is how the “Whos” in Whoville got their name. They kept asking, “Who stole Christmas?” The answer is the same grinches that plan to steal next Christmas as well.
Merry Christmas anyway!
But watch out for an unhappy New Year.
June 18, 2013