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It's common knowledge that California is going broke. So broke they're asking for TARP money, a program whose beneficiaries can't get out of fast enough. It was bad enough when they took my money to give to banks and companies that made bad decisions - but naysayers were explained away with words about "systemic risk" and "too big to fail." With a GDP among the top ten in the world (were it an independent country), it's hard to see how we won't see those same platitudes trotted out again.
But what's behind all this? The usual brilliance over at Reason.tv takes a good look at the rise and fall of California's latest, best hope for limited government and the unions that toppled the Governator. It's worth watching the whole thing.
After watching that, and seeing the power public-sector unions have, it's important to check out this WSJ piece.
In New Jersey, which faces a $3.3 billion budget deficit, angry state workers have demonstrated in Trenton and taken Gov. Jon Corzine to court over his plan to require unpaid furloughs for public employees. In New York, public-sector unions have hit the airwaves with caustic ads denouncing Gov. David Paterson's promise to lay off state workers if they continue refusing to forgo wage hikes as part of an effort to close a $17.7 billion deficit. In Los Angeles County, where the schools face a budget deficit of nearly $600 million, school employees have balked at a salary freeze and vowed to oppose any layoffs that the board of education says it will have to pursue if workers don't agree to concessions.
Call it a tale of two economies. Private-sector workers -- unionized and nonunion alike -- can largely see that without compromises they may be forced to join unemployment lines. Not so in the public sector.
Government unions used their influence this winter in Washington to ensure that a healthy chunk of the federal stimulus package was sent to states and cities to preserve public jobs. Now they are fighting tenacious and largely successful local battles to safeguard salaries and benefits. Their gains, of course, can only come at the expense of taxpayers, which is one reason why states and cities are approving tens of billions of dollars in tax increases.
It's clear this isn't just a California problem, it's a national problem. And while it might be easiest to see at the state level where teachers unions, et al are draining state coffers with no hint of ever compromising, if it isn't already - it will soon be obvious at the federal level as well. That's because President Obama's job growth plan is banking on a huge expansion of government to the tune of 600,000 public sector jobs. And recent job numbers touted as a big win for the President were padded by a whopping 66,000 government jobs.
If we think it's bad in California now, can you imagine how bad we'll all have it when the public sector is even bigger than it is now? Taken together, the Reason video and WSJ article paint a gloomy picture, compounded by the threat of card check that would bolster union power exponentially. California is clearly a very sick canary - the same tax and spend tactics to appease the union looters only spells its death. People should get out now or stand up to union thuggery and let in the fresh air of reform.