Monday, November 15, 2010

Faux Conservative

Arnold Schwarzenegger pulled off some jaw-dropping feats as a movie action hero. But he saved the best for his last role — leaving the state of California in even worse shape than the man he replaced as governor after a recall.
Californians had high hopes for the Terminator when he rappelled into the 2004 race to replace the wimpy Gray Davis. At the time, the swaggering, cigar-puffing bodybuilder seemed like a shot in the arm.

He entered office claiming to be a conservative through and through, a disciple of big-thinking free-market economist Milton Friedman. Now he leaves sounding like his successor — the small-is-beautiful retread from the benighted 1970s, Jerry Brown.

In his first State of the State address, Schwarzenegger bemoaned the "staggering" $15 billion deficit he had inherited — an "aftershock of past financial recklessness." Well, last Wednesday, in a report that seemed to surprise everyone in (but few outside) Sacramento, the state's chief budget analyst estimated this year's shortfall at $25.4 billion.

How can this be? Check the text in which this editorial is floating. It's a list of California's many departments, offices, agencies, schools and quasi-governmental groups— a mare's nest of bureaucracy and red tape. It gives you an idea — but only an idea — of how smothering government has become in the so-called Golden State.

Schwarzenegger spoke of all this officialdom in that first speech. "We cannot afford waste or fraud in any department or agency," he said. "Every governor proposes moving boxes around to reorganize government. I don't want to move boxes around; I want to blow them up."

Judging by the list, he missed a few. The only thing he blew was a permanent hole in the state budget. From 2004 to 2007, Schwarzenegger and the wildly irresponsible Democratic state legislature increased spending by $34 billion, or just over a third.  California is required by its own Constitution to balance its budget. It hasn't done so without gimmicks since 1999.

Schwarzenegger also brayed about becoming California's "job czar." "I am a salesman by nature," he said. "And now most of my energies will go into selling California." Seven years later, the state's a tougher sell than ever.

By almost any measure, it's the most frustrating state in the union to do business. In 10 years, it has lost 640,000 factory jobs, or 34% of its manufacturing base. Unemployment, which in '04 stood at 6.1%, is today at 12.4% — close to its all-time high of 12.6%. Some 2.3 million Californians are without work. No wonder the state, with 12% of the nation's population, has 36% of the welfare recipients.

Schwarzenegger could have done something about this by opposing a climate-change law that may cost the state $100 billion and boost each citizen's cost of living by $7,857, according to Larry Bell of the University of Houston. Instead, he counts it as his crowning achievement.

Even without that ruinous law, an estimated 5,000 people flee the state's high taxes, business-unfriendly government and heavy-handed regulation for other states each week. Many are smart, can-do leaders in business and other fields who built the state's great wealth.

Once upon a time, Arnold Schwarzenegger, the great conservative hope, seemed to fit in. Then he exited, stage left.


sara p said...

Never under estimate the influence of sleeping with a Kennedy!

Baxter said...

That is more IBD pap, Doc. Arnold was always a moderate Republican - the only kind that stands a chance of being elected in the Golden State. He could never have won a GOP primary prior to taking office - it took recalling the just re-elected Gray Davis and the wide open field for Schwarzenegger to win the job.

He was beat by California's near-ungovernable system as well as the Bush economic collapse. He says he wouldn't trade a minute of it - I suspect he is very glad to be leaving. Incumbent governors of both parties nationwide are very unpopular these days as they cope with the greatest economic downturn in generations.

If I wrote the rules, a simple majority could pass the California state budget (a super majority is currently required). I would also curtail the initiative process as it creates a lot of conflicting law and crowds out much of the legislative process. Slick ads financed by the monied special interest groups have an outsized voice at present.

So much to do...