It is perhaps the most dishonest line in the entire California budget debate: It will only cost a typical family $80 a year to keep tax extensions in place to save the schools, public safety, parks, and anything else you might happen to care about that Sacramento touches.
That might be partially true if the $8 billion that would roll into state coffers if the vehicle registration and income tax extensions were extended instead of expiring on July 1 indeed went to the classroom.
Sacramento, however, has established a consistent and clear record over the past 20 years that it won’t go down that way.
Just take one small piece of the decades old deception called the California budget. Back in 1991, the legislature delayed a $168 million payment by a day that it owed the state employee pension fund as part of smoke and mirrors to balance the budget that year. Of course, \ when revenue increased the state never paid the money and instead funded new programs. Today the state still owes that missed payment to the California Public Employees Retirement System but now it has swelled to more than $500 million thanks to interest.
If you think that $80 a year is going to filter down into the classroom either in the form of teacher salaries or educational materials, then you’d be ignoring two facts: The stimulus funds that have propped up state funding for the last three years when state leaders should have been streamlining operations is almost gone plus public employee pension costs are accelerating.
Essentially the $80 will - for the most part - go to feed the pension monster created by the politicians in binding contracts that they approved.
The contracts that are helping drive California state finances to the edge of the abyss weren’t put in place by “heartless” taxpayers who won’t continue to give up “just $80 a year” so Johnny can learn how to read.
Yes, it is true that real layoffs and not just pay cutbacks are going to finally hit the state government sector just as they have ravaged the private sector, local schools, and local government for the past four years. The state, however, squandered opportunities to rethink how it does business and slim down its workforce as most of the private sector and most cities had to do to stay standing.
Private sector and local government employees have carried the brunt of the economic hit. If you doubt that look where the overwhelming number of layoffs have taken place since 2007. And while state workers have had furlough days they pale in comparison with many private sector workers who often don’t have benefits but also saw fulltime jobs slashed 40 percent in terms of hours of employment.
Now the clarion call is out to those people who have carried the brunt of the economic suffering to take another hit so essentially state pensions can remain whole.
It is tough to find very many of the typical California families who are told they can save schools et al by keep forking over $80 a year who haven’t seen their retirement investments decimated. Yet state employees are guaranteed a set amount not based on how well the money they squirreled away is doing in investments but on a contractual number propped up by state tax dollars. Why should public sector employees be immune from forced restructuring by a financial catastrophe? When a private sector enterprise with “guaranteed” retirement benefits goes through bankruptcy or worse, the benefits of the employees are adjusted accordingly.
A more honest line would go something like this: It would cost a typical California family that’s had their pensions hammered just $80 a year to save the pensions of state employees.
Yes, something has to be done. But why should Californians continue to be played as fools after 20 years of overt deception and manipulation from Sacramento? The state employee unions and politicians won’t even make the simplest - and easiest - move toward pension reform by implementing a two-tier system with lower benefits promised for new hires.
Until Sacramento and the public unions change the way they do business, keeping the tax extensions in place is no different than expecting a crank addict to come clean by plying them with meth.
The only difference with Sacramento is the drug of choice is money.