Hullabaloo

Tuesday, January 04, 2011

 
Austerity, Democrat Style

by digby

A new era unfolds in California:

Brown... wants to slash virtually every state-funded program to help balance California's massive deficit, in many cases resurrecting cuts sought by Gov. Arnold Schwarzenegger but rejected by lawmakers. Brown would restrict Medi-Cal access, divert low-level offenders to county jails and cut deeply into California State University and the University of California.

The Democrat is counting on lawmakers to approve the cuts to encourage voters to also provide revenue. A June ballot measure would extend higher tax rates on income, vehicles and sales set to expire this year, as well as eliminate a new corporate tax benefit. The money from the vehicle and sales tax extensions would be sent to local governments, which would take on some functions the state performs now.

Can someone please explain to me why anyone thinks that's going to work? Do they think the citizenry will be so impressed by the government's mature willingness to cause pain that they will agree that it's time to pay more in taxes?

This should be a very interesting test of the starve the beast psychology. Brown wants to throw the state into further chaos in the hope that people will decide that they need to pay more for government services. The Republicans, of course, are counting on 40 years of conservative propaganda kicking in to reinforce the fact that government is so inherently dysfunctional that it can't do anything right and so you shouldn't send one more dime to the politicians who can't deliver. Having this big test come under a Democrat is key. If it doesn't work, it not only destroys the government, but the entire rationale of the Democratic Party with it. Sweet.

It should be interesting to see how this all works out. Grover Norquist must be all aquiver with anticipation waiting to clean out that empty bathtub. As California goes ...



Update: I would guess these guys are going to deal with this in a different way, so it should be an interesting contrast:

there's one state, which is fairly high up on the list of troubled states that nobody is talking about, and there's a reason for it.

The state is Texas.

This month the state's part-time legislature goes back into session, and the state is starting at potentially a $25 billion deficit on a two-year budget of around $95 billion. That's enormous. And there's not much fat to cut. The whole budget is basically education and healthcare spending. Cutting everything else wouldn't do the trick. And though raising this kind of money would be easy on an economy of $1.2 trillion, the new GOP mega-majority in Congress is firmly against raising any revenue.

So the bi-ennial legislature, which convenes this month, faces some hard cuts. Some in the Texas GDP have advocated dropping Medicaid altogether to save money.

So why haven't we heard more about Texas, one of the most important economy's in America? Well, it's because it doesn't fit the script. It's a pro-business, lean-spending, no-union state. You can't fit it into a nice storyline, so it's ignored.

But if you want to make comparisons between US states and ailing European countries, think of Texas as being like America's Ireland. Ireland was once praised as a model for economic growth: conservatives loved it for its pro-business, anti-tax, low-spending strategy, and hailed it as the way forward for all of Europe. Then it blew up.


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digby 1/04/2011 09:21:00 AM