News from the Dark Side of the Laffer Curve
California's famously perfect weather and spectacular scenery have not been enough to save the state from an 11 percent unemployment rate, as officially measured, or gargantuan annual state budget deficits. Liberal Democrats control the levers of power in the state and pretty much all the cultural assumptions, but reality stubbornly refuses to give way to the promised utopia. Consider the lead article in this morning's San Jose Mercury News.
SACRAMENTO -- California's projected budget deficit has ballooned to $16 billion, much larger than predicted just four months ago, Gov. Jerry Brown said Saturday as he warned of draconian cuts to schools and public safety if voters don't approve his November tax-hike measure.
The governor said the shortfall grew from $9.2 billion in January in part because tax collections are sluggish and the economy hasn't recovered as quickly as expected. The deficit also has soared because lawsuits and federal requirements have blocked billions of dollars in state cuts to social programs, Brown said.
Could government tax and regulatory policy be contributing to our unexpectedly--notice how all statist failures are "unexpected"-- sluggish recovery? Heresy. Our state's economic underperformance must be the work of a wrathful and unjust god, or something George W. Bush and Dick Cheney did to us. Somehow.
Meanwhile, consider the chart below comparing California's unemployment rate over time to that of Texas, another large industrial state. The two states parallel one another until 2006, when California unemployment surges ahead. Coincidentally, no doubt, 2006 was the year California passed AB32, the "Global Warming Solutions Act," which outsources escalating energy taxes and other job-killing regulations to the California Air Resources Board, now gearing up to reduce California greenhouse gas emissions to 1990 levels by 2020.
Texas here we come.
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Dec '10
Re: News from the Dark Side of the Laffer Curve
George,
Governor Moonbeam of California and President Moonbeam of France. Same scenario same result.
France and California have something in common. They think that they are on the cultural cutting edge. This has made them susceptable to Socialism's Siren Song.
At the very moment when California should have realized that there was no free lunch they chose to elect their old friend Governor Moonbeam. Moonbeam was guaranteed to continue to sing the tune of political correctness and green economy. Once Moonbeam had taken office I compared him to Wile E. Coyote having run off the edge of Cliff his legs spinning was still levitating in mid air. Sooner or later he would look down and realize he was about to do the mile long crash dive into the canyon below.
Wile E. has just looked down. The screaming and whining as California crashes is going to be just amazing.
It will probably take a year or two for President Moonbeam of France to look down. In the very short meantime, he may be able to destroy Merkel in Germany. Too bad she was the most responsible and sympathetic leader Europe could expect to have.
Regards,
Jim
Edited on May 13, 2012 at 7:24pmDec '10
Re: News from the Dark Side of the Laffer Curve
Interesting final comment, George. Care to elaborate? (Besides, didn't I hear or read somewhere that you are now based in FL?)
Re: News from the Dark Side of the Laffer Curve
CJ, I will be staying in California for the foreseeable future. However, taken as a whole, California one - percenters - - otherwise known as taxpayers - - are voting with their feet for friendlier climes, Texas prominent among them.
Oct '10
Re: News from the Dark Side of the Laffer Curve
I stumbled across this quote from John Maynard Keynes.
".. that to create wealth will increase the national income and that a large proportion of any increase in the national income will accrue to an Exchequer, amongst whose largest outgoings is the payment of incomes to those who are unemployed and whose receipts are a proportion of the incomes of those who are occupied,...
Nor should the argument seem strange that taxation may be so high as to defeat its object, and that, given sufficient time to gather the fruits, a reduction of taxation will run a better chance, than an increase, of balancing the Budget. For to take the opposite view to-day is to resemble a manufacturer who, running at a loss, decides to raise his price, and when his declining sales increase the loss, wrapping himself in the rectitude of plain arithmetic, decides that prudence requires him to raise the price still more;—and who, when at last his account is balanced with nought on both sides, is still found righteously declaring that it would have been the act of a gambler to reduce the price when you were already making a loss."
Dec '10
Re: News from the Dark Side of the Laffer Curve
Intersting wording, but understood, Dr. Savage. For the forseeable future I will remain in the worst, most depressed part of Florida, probably for similar reasons (kids, schools, etc.).
However, if you are going to stick it out, I would ask that you might reach out to public personalities that are chafing, such as Carolla and Lovitz, as they teeter on limbs and no longer even have Breitbart to comisserate with.
There is no hope for me, as possibly the only conservative Marine Biologist in Florida. I have tried to be vocal for many years about crushing my mutual friends in other industries and have only received two, clear, responses:
Shut up. And, oh yeah, shut up.
I can't shut up when the only place in the world that would allow me to study crabs, while earning a living helping other people battle bureaucracies, lives by the light of a candle flickering out.
I cannot, again, live in the socialist country where I had my last big smile there, in my icon, when I was 2 years old.
I want our boys to smile, but they can't get jobs.
We must reach out to our fishermen, and our entertainers.
Apr '11
Re: News from the Dark Side of the Laffer Curve
We fortunate few in Jersey are getting a 10% income tax cut thanks to the big man.
I pity conservatives in Cali.
Jan '11
Re: News from the Dark Side of the Laffer Curve
Let them raise taxes, as they are asking to do this November. Give the California Democrats exactly what they want.
Steve Hayward pointed out that in the 1980s the tactic conservatives adopted was "starve the beast." It didn't work. He now recommends a Paula Deen diet for the beast, with diabetes to follow.
In the current National Review Mark Steyn says this nation is in decline, and in another article in the same issue Kevin Williamson says that contrary to popular belief some Americans willingly choose decline.
We have the examples in front of us. Stop fighting it.
Make California Detroit. Make Illinois Camden. Give the Democrats what they want. It will serve them right. And who knows, it may teach those imbeciles a lesson.
Edited on May 14, 2012 at 3:27amJun '11
Re: News from the Dark Side of the Laffer Curve
George, that is a great chart on the unemployment in California and Texas.
California can turn around on a dime. I nominate the Golden State as the state with the most resources squandered for stupid reasons. Unbelievable.
Apr '12
Re: News from the Dark Side of the Laffer Curve
I think we all need to keep fighting the good fight. The fight between statists and those believing in liberty and free markets has been fought as long as history has recorded. Taking our marbles and moving to a free state does not help the situation. Instead, it traps many in situations of poverty.
Freesmith, you say make California Detroit? I live just north of Detroit. The whole area is dragged down by having a huge, blighted city in the middle of it. They have been making progress towards bringing it back to life, but it is taking decades. California as Detroit would not just affect California. All of the surrounding states would be changed, as well. Oregon and Washington already have refugees from California bringing with them the same ideas that have been put California behind the eight ball. It will only get worse as California falls deeper into the abyss.
Sep '10
Re: News from the Dark Side of the Laffer Curve
Terrell David: George, that is a great chart on the unemployment in California and Texas.
California can turn around on a dime. I nominate the Golden State as the state with the most resources squandered for stupid reasons. Unbelievable. · 6 minutes ago
This reminds me.
That statement that Romney made to Perry about being given four aces is a lie. Texas is a fullhouse and they play it every time. California is a state that is a royal flush, that will win every time they decide to play.
I know it sounds rather outlandish for you Californians but I honestly think the best thing that can happen to the rural and and suburban along with some of the urban areas break away to form additional states (as in at least 2 more).
Keep in mind that it wasn't just King George that we broke away from Britain. It was that Parliament was way to Britain centric where we found ourselves being an easily isolated minority. The urban centers in LA & San Fran deny the rest of California any ability to pull themselves out of the brink made by decision makers in Sacremento.
Edited on May 14, 2012 at 4:24amJan '12
Re: News from the Dark Side of the Laffer Curve
Best thing that could happen in my state, California: the people should come to realize that the public schools, as they are constituted now for "self esteem" and political correctness, are not worth the taxpayers' dimes.
Do not mistake me; I am not writing from a libertarian perspective. In my Eleventh Grade American History class at the public Redwood High School, I learned more simple facts than most college seniors receive now. And yes, conflicts were discussed and certain ideologies were implicit; but events themselves were always presented under the notion that Americans worked toward actualizing universal liberty.
But this was fifty years ago, when the class president was a young man named John Burke. He knew who Edmund Burke was, and he admired his namesake.
Do you wonder why I believe that the culture suffered less from the sting of decadence fifty years ago? Sometimes when an old man reminisces about 'the good old days,' they really were, in some very important respects, good enough--and in any case less burdened with the petty tyrannies we must now endure.
Edited on May 14, 2012 at 4:55amJan '11
Re: News from the Dark Side of the Laffer Curve
Arahant
"I think we all need to keep fighting the good fight."
The question you need to answer is whether the good fight is the one that is "good," but loses, or the one that is good because it succeeds.
Conservatives have won elections and passed referenda, but the culture continues to drift inexorably Left and anarch0-utopian.
We used to be the Shining City on the Hill; today, we have been cast outside of its walls, whose commanding heights are held by the very people who made Detroit what it is. Conservatives like us now protest, we now rally, we now engage in guerrilla tactics.
Our traditions used to be revered; today they are castigated as racist and mean-spirited. Our definitions used to hold sway; but Democrats have redefined whatever they wanted, from marriage to mortgages, to suit themselves.
Why isn't Detroit's sorry state a campaign issue? Why is Governor Snyder attempting yet another foolish state scheme to bulwark Bing & Company? The reason is simple: we have not held our opponents accountable for their sins.
They made their beds. Let them lie in them. Edmund Burke is clear on this matter:
Jan '11
Re: News from the Dark Side of the Laffer Curve
"Example is the school of mankind, and he will learn at no other."
The title of Kevin D. Williamson's article that I referenced above is "Let Detroit Fail."
Edited on May 14, 2012 at 5:37amJan '12
Re: News from the Dark Side of the Laffer Curve
Freesmith: "Example is the school of mankind, andhe will learn atno other."
The title of Kevin D. Williamson's article that I referenced above is "Let Detroit Fail." · 7 minutes ago
Edited 0 minutes ago
Ah, another alumnus of that old Burkean High School! Welcome, sir!
Jan '12
Re: News from the Dark Side of the Laffer Curve
As to your questions, sir, I fear that few today are persuaded even to ask them. That modern yet nevertheless perspicacious fellow, George Orwell, has put his finger on the contemporary form of public discourse. No doubt in traditonal times, language could become fawning and suavely misguiding, the toy of toadies; just recall the laments of Pope (especially in Dunciad), Swift, and Addison; but the dark "art" seems to have conjured even more subtle imps in modern times. Something about that "grammatology" and all, no?
Edited on May 14, 2012 at 6:04amJan '12
Re: News from the Dark Side of the Laffer Curve
James Gawron
....Too bad she was the most responsible and sympathetic leader Europe could expect to have.
Please, please do not even in jest suggest that Europe has a leader.