A generation ago California became a political trend-setter when voters approved rigid restrictions on the raising of taxes, leading the way in the anti-tax, anti-government revolution that appears, finally, to be running its course.
Now California may be leading the way in another direction. A column by Timothy Egan in the online New York Times describes the early stages of a California renaissance that may portend changes for the nation as a whole.
California’s woes are well known. It was a state known for public schools among the best in the nation and a highly ranked university system that was tuition free for California residents. Great public works projects provided irrigation water for central and southern California and drinking water for the population centers of Los Angeles, San Diego and the San Francisco Bay Area.
But the tax revolution made it impossible for the public sector to keep pace with public needs. The state racked up massive budget deficits, largely because constitutional restrictions made it nearly impossible for the Legislature to raise taxes. In consequence, the public schools deteriorated and the University of California, no longer tuition free, became both expensive and underfunded.
Following the meltdown of the governorship of Arnold Schwarzenegger, California voters turned to a familiar face, electing Jerry Brown to a third term. Brown undertook changes that seem to have initiated a new era in the state’s history.
Significantly, Brown persuaded voters to approve a ballot initiative to raise taxes. As a result, the state now anticipates a budget surplus by next year. Job creation is growing and people are migrating into the state despite the fact that the tax rate on top earners is the highest in the nation — 13.2 percent on incomes above $1 million. The usual bluster from rich celebrities threatening to leave the state has not dissuaded waves of new California immigrants.
Further, Brown is pushing major new public works projects, including a bullet train, expected to cost $68 billion, that will travel from San Francisco to Los Angeles in two hours and 38 minutes. The drive takes eight hours. A flight, including the time it takes getting to and sitting around in the airport, would certainly take longer than the train.
Improvements to the state’s Central Valley water system represent another major public works investment.
It used to be we took pride in the investments we made in America — the highways, bridges, railroads, dams, canals, universities, schools, parks, even the water purification infrastructure that ensures the public health. We have forgotten that these are not one-time investments. They demand upkeep and renewal. During our era of austerity, we have allowed America to fall apart.
The new chapter in California’s history is still only an experiment. The state still suffers from high unemployment, poverty and many other problems. But by dispelling old myths the state is pointing in a new direction.
President Obama is trying to head in that direction, pushing for federal infrastructure spending that would both create jobs and renew the public works that underpin our prosperity. And he is challenging the myth that raising taxes throttles prosperity. California’s experiment supports his view.
Vermont policymakers ought to take note of this new direction in the nation’s history. The conservative experiment — starving the public sector of resources — has reached its logical conclusion: public institutions lapsing into decline and disrepair. The Vermont House has caught on, resisting the efforts of Gov. Peter Shumlin to push new burdens onto the poor while protecting the rich.
It is important to guard against a bloated, complacent public sector, but that is not the problem facing the state and nation these days. Ideological rigidity, combined with economic collapse, has left the public sector emaciated rather than bloated, and the people are far from complacent. Rather, they are eager to take on the challenges of improving their state and nation.
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