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California Has One Option Left to Stop the Bleeding

Posted: 11/28/11 04:29 PM ET

This piece was co-authored by Joshua Pechthalt and Anthony Thigpenn

When we think of California, we imagine the state that allowed the three of us to be who we are, a state that gave us the California Dream. For years now, that dream has been quickly slipping away and now it's in danger of being lost forever.

California is not in crisis; crises are sudden and acute. California is in a chronic, grinding decline and it's providing a window into America's tomorrow. Here we have the richest and poorest, the most diverse population, high technology centers which lead the globe. And yet, here with 38 million people -- 20% of the United States -- we cannot find a path to leave the bounty that invigorated us for the next generation.

The answer will not come from Sacramento, just as on the national level it cannot come from Washington. It needs to come from all of us. It's simple: government has a central role in providing the basics of civilization and that costs money.

The first step is admitting that we need more money to pay for our present, much less our future. That's why it's time for the 1%, those who benefited the most from our state's past investments, to invest in our state's future. Our state needs perhaps $20 billion a year in new revenue to assure that kids grow up to lead. That will take time, but for now, we see a clear path to $6 billion or so a year that would at the very least restore a large portion of the most recent cuts to education, healthcare, safety and transportation. All it takes is the 1% chipping in and paying more income tax.

Warren Buffett said it best: "If anything, taxes for the lower and middle class and maybe even the upper middle class should even probably be cut further. But I think that people at the high end -- people like myself -- should be paying a lot more in taxes. We have it better than we've ever had it."

It's been a brutal decade for most Californians. Our schools, universities, hospitals, roads, and bridges -- which used to be the envy of the nation -- are in tatters. The unemployment rate hovers around 12%, and Sacramento continues to talk only about what to cut next, perpetuating the downward spiral.

Students are rightfully disgusted as they take to the streets and create their own Occupy encampments to protest the relentless inflation of tuition at California's legendary colleges and universities. Working families who dream of providing their children with a higher education watch in horror as costs continue to skyrocket.

A couple of weeks from now, we face a massive $2 billion in additional cuts that will be "triggered" based on a summer budget deal passed on a wishful premise that the economy will get better before it gets worse. On the front lines once again will be children, the elderly, and disabled. The axe will fall on everything from public schools (where California already ranks 47th in per pupil spending) to in-home health care.

A Washington Post-Bloomberg News poll from last month shows that 68% of all Americans support raising taxes on households with incomes of $250,000 per year and higher. Gov. Brown could also take his cue from the patron saint of fiscally conservative Republicans, former California governor Ronald Reagan, who raised taxes as governor and president numerous times, knowing it was for the good of our state and country.

Should every child in California have access to an excellent, rigorous, free education through college and beyond? Should they have healthcare to assure that their minds are sharp and their bodies fit? Should they know that at any point after high school, whether they choose college or another path, they can find a good job? Should they be the sail that lifts our economy to new heights in energy and technology solutions of tomorrow?

Yes.

We believe in our state. We believe in our country. We are patriots of the first order who know that true love of state or country manifests not in slogans, but in deeds that offer a brighter future to the next generation than to ours.

The time has come to say yes to our dreams. The time has come for the 1% to join the fray and help rebuild our state and our country. Let them come forth and pledge with us to invest in tomorrow, starting today.

Joshua Pechthalt is the president of the California Federation of Teachers, representing over 100,000 teachers and education workers. Anthony Thigpenn is president and founder of California Calls, a statewide alliance of 26 community-based organizations who have built a base of 328,000 supporters of a progressive, economic agenda.

 

Follow Rick Jacobs on Twitter: www.twitter.com/rickjacobs

This piece was co-authored by Joshua Pechthalt and Anthony Thigpenn When we think of California, we imagine the state that allowed the three of us to be who we are, a state that gave us the Californi...
This piece was co-authored by Joshua Pechthalt and Anthony Thigpenn When we think of California, we imagine the state that allowed the three of us to be who we are, a state that gave us the Californi...
 
 
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06:05 PM on 11/30/2011
I tend to think California is in a crisis. Like the skydiver who is 10 feet from impact. Now ,that's bad-if you live in California. But,if you live elsewhere,it's both educational and amusing. let's postulate a state where Non Smart People gained political control As time passed,they did more Non Smart things and the Smart people left.The Non Smart People continued the actions that caused the crisis,and things worsened Soon,the N on Smart People were locked in a morass of Loserville,and the rest of the country took note.
Think of it as evolution in action
10:11 PM on 11/30/2011
Best description yet of Reaganism.
10:37 AM on 11/30/2011
California needs serious tax reform and a serious overhaul on the way it spends money. First thing is that state worker pensions needs to be reigned in. Cut the pensions and make state workers participate in Social Security which currently they are not. Second is we need to get rid of the generous social services we have in this state. Reduce welfare benefits to 2 years which is the federal minimum with no exceptions. California is a nightmare to do business in. Small businesses pay way too much in taxes. Small corporations have to pay $800 a year just to exist whether they make a profit or not. We should model our tax code after Nevada which has no state income tax on corporations or individuals and very minimal social services. With our diversified economy California could be a job creation engine again if businesses had to pay no taxes. We have too many poor people in this state and in Los Angeles county 22% get some kind of government assistance. Get rid of the handouts and we can send the poor to Texas instead of job creating companies.
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HUFFPOST SUPER USER
Napoleon3
08:27 AM on 11/30/2011
I find it funny that some people call it patriotic for others to pay their way.

Also, go ahead and raise taxes on rich. We can use them over here in Arizona.
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Mr Bobo
Warriors, come out and PLAY-AY!!
06:17 PM on 11/29/2011
You have to look at the states revenue like you look at an annual bonus from your job (I don't get one). If your company is doing well and you get a big fat bonus (the real estate boom), it's not wise to go out and finance a new S-Class Mercedes (social programs), a home addition (30% salary increase to the prison guards union) and a 60" television assuming that your bonus will always be there. Because next year, the company's profits could drop and they may need to lay workers off and hold back the bonuses. Better to spend wisely and save for a rainy day, which California refuses to do. We just keep going to our credit cards to supplement our lifestyle.

Sometimes you have to give up the fancy car, magazine subscriptions, cable tv and soft water to weather the storm.
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HUFFPOST SUPER USER
giftsthatpurr
zestful life
06:37 PM on 11/29/2011
So you want to give up our elderly, our children and education - as well as the declining infrastructure and environment? I don't mind doing without frills, but we need to take care of a lot more than that, and the 1% won't even mind having their tax cuts expire.
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Napoleon3
08:28 AM on 11/30/2011
You realize that a person can pay more if they want.
06:06 PM on 11/30/2011
Diffidently, I have to inform you a state without Smart People can not long survive.Still, I guess one can think of it as Evolution in Action
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field-man
The bounty hunter
04:41 PM on 11/29/2011
California is a Disaster, Democatic Socialism policies at work
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Y3rMawm
veni, vidi, bibi.
04:39 PM on 11/29/2011
Trying to chase the 1% to Texas?

Perhaps those government projections of 8% growth per year were an actuarial unicorn crapping skittles? What do you think? The idea that giving more money to the state will eliminate the deficits is naive at best. There are votes to be bought.
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Mr Bobo
Warriors, come out and PLAY-AY!!
08:17 PM on 11/29/2011
Marked as a "favorite" for use of the phrase "actuarial unicorn crapping skittles". LOL!
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Moravecglobal
04:37 PM on 11/29/2011
California has one option left to stop the bleeding in higher education. I love University of California (UC) having been a student & lecturer. Like so many I am deeply disappointed by the pervasive failures of Birgeneau from holding the line on rising costs & tuition increases. On an all in cost, Birgeneau has molded Cal. into the most expensive public university.
Paying more is not a better education. Instate tuition consumes 14% of Calif. median family income! Faculty wages must reflect California's ability to pay, not what others are paid.
Chancellor Birgeneau ($450,000 salary) dismissed many much needed cost-cutting options. He did not consider freezing vacant faculty positions, increasing class size, requiring faculty to teach more classes, doubling the time between sabbaticals, freezing pay & benefits, reforming pensions & health benefits.
Birgeneau said such faculty reforms “would not be healthy for Cal”. Exodus of faculty, administrators: who can afford them?
We agree it is far from the ideal situation. UC Berkeley cannot expect to do business as usual: raising tuition; granting pay raises & huge bonuses during a weak economy that has sapped state revenues & individual Californians’ income.
Birgeneau can bridge the trust gap with alumni, donors, politicians, and the public with reassurances that salaries & costs reflect California’s ability to pay.

Chancellor Birgeneau’s campus police deployed violent baton jabs on students protesting increases in tuition. The sky above UC will not fall when Chancellor Birgeneau ($450,000 salary) is ousted.

Opinions? Email the UC Board of Regents marsha.kelman@ucop.edu
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02:46 PM on 11/29/2011
California, one of the most liberal states in the Union, is the canary in the mine for the Left's ideology.

It is now laying feet up at the bottom of the cage.

I doubt it is sleeping.

Stick a fork in it.
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Napoleon3
08:30 AM on 11/30/2011
Cpuld not have said it best. Some people think thus can create utopia but now with their money
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wayne the pain
01:37 PM on 11/29/2011
California has no ability to tax business and that has been the problem since the Jarvis-Gann law was passed in 1978! We are the only state that does not have an oil depletion tax or tax on limber companies that cut our forest! Working people pay up to 35% tax on incomes and business who complain loudly pay almost nothing. California is be best example of the 50 states where the Top 1% own most of the wealth and pay next to nothing. As a result everything is is decaying, roads, water ways, schools etc.! Until the 1% and corporations pay their fair share the Golden State will continue to lose its glitter except in Hollywood!
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nkdgolf
Be the best that you can be!
05:33 PM on 11/29/2011
You cannont tax the 1% enough to cure California's problems. The elected state (and city) officials have been ignoring this problem for years.
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wayne the pain
06:11 PM on 11/29/2011
True but you can tax the corporations and businesses that don't pay any California taxes and that would put a big dent in the defecit! Repeal Prop 98 and tax business property at fair market value and the problem would be solved!
MrStat1
I believe in the rule of law
01:10 PM on 11/29/2011
The time has come for California voters to continue to say no to tax rate hikes! This state spends too damn much money it doesn't have. And sucking more and more money out of whoever is going to send them out of state and you will get nothing.
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hammhome
popcorn anyone?
01:00 PM on 11/29/2011
California has one of the most progressive tax systems in the country. The reason the state is broke is because those few 1%'ers still living in CA aren't making the kind of money they have in the past, so the tax revenues are down. The rich and the middle class are moving out in droves for Texas. Gavin Newsom, our Lt. Gov., even went on a fact-finding trip to Texas to find out what's up. Lower taxes, less regulation and jobs was the answer!
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inmyhumbleopinion
Vote third party.
11:55 AM on 11/29/2011
Why no mention of repealing Prop. 13? That was the beginning of the end for California and it has become a sacred cow that no politician will touch. Which is unfortunate because I think if there was any time in the last 30 years we could re-address the destruction this proposition has caused, now would be it.

I think, too, that the entire direct voting system via propositions has to be thrown out. Sacramento is paralyzed because the money is all spoken for--and yet, voters are not given the context for making their decisions. For example, voting to keep the state parks funded sounds great, until one realizes that means less revenue for public education. But that is never talked about in the way the proposition is presented, so voters are making decisions in a vacuum.

As someone who has lived here for 12 years but grew up on the East Coast, I'm astounded by the dysfunction. We elect representatives for a reason: to make decisions on our behalf that they have the time to study in depth based on the recommendations of their staff and policy gurus. Don't like what they've done? Great. Vote them out of office. Direct voting, while conceived with good intentions, has crippled this state and its ability to have a functioning government.
01:49 PM on 11/29/2011
You only living here for 12 years says it all......Prop 13 helped a lot of seniors stay in their homes and it's not going away any time soon.....
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inmyhumbleopinion
Vote third party.
02:01 PM on 11/29/2011
The whole "taxing seniors out of their home" argument was a smokescreen to allow us to focus on that non-issue while corporations got more tax breaks than they deserve. It's baloney. My mother-in-law bought her home in the late 60s for about $30K. Her house, that she owns free and clear, is now worth $800K and she's paying her property tax at the $30K rate. Ridiculous. If you're telling me that someone with that much equity in their home isn't capable of paying $8K in taxes every year, you're dreaming. But let's say you're right; that for some reason $8K/year is too much on a limited budget. Then downsize and move into a smaller, less expensive home! Most seniors are loathe to maintain a single-family home anyway--too big and too much upkeep.

The financials around this argument just don't wash.
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RUKidding0
Freedom is Fundamental
11:41 AM on 11/29/2011
California has long been America's most virulent social democratic state as its outrageous taxes, insane over-regulation, and doomed to fail social engineering unmistakably attest.

It is also long since time that the state paid the price of its profligacy by going bankrupt and, subsequently divided into two California states - Social Democratic California (including the coastal counties from L.A. to Mendocino County) and Free California (the rest of the state, including Orange, San Diego, Riverside counties).

More importantly, a bankrupt California would serve as an example to the rest of America of the consequences of allowing the completion of a rent seeking social democratic state.

Good riddance,
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inmyhumbleopinion
Vote third party.
01:32 PM on 11/29/2011
Baloney. California has LOWER property taxes than just about any other comparable state in the nation. I pay $10K per year on my home that is valued at a bit more than $1 million (this is California, remember. My house would probably be worth half that in the midwest). That's bubkes compared to a similar suburb in NY, for example, which would be paying at least $16K per year or more. But, the difference between my taxes and theirs is that theirs is locally controlled. Meaning, that money goes directly into their community in the form of public education and services like police, fire, etc. It's not an accident that the NYC suburbs have some of the best public schools in the nation. They pay for it, and gladly, too. To them, it's still a bargain compared to the cost of private school.

Seems like a good investment to me.
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EbonBrown
ignant and lovin it
04:41 PM on 11/29/2011
no hablo
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jmpurser
See My micro-bio
11:37 AM on 11/29/2011
In the first place I think there is no way "back" to being a prosperous first world nation for the USA. Reagan and company (with able assistance from the Democrats) have really broken the structure that allowed that. And I don't think we can recreate it by copying the steps we took to create it in a very different world. That said, I DO think we need to start throwing real resources into education AND to redefine education itself. Being able to count money, type a memo, and enter data makes you a valuable monkey, not an educated human being. I wish I saw a way to "fix" all that's wrong. But at this point "we" as a nation can't even agree on what's killing us so I don't see us coming together on any solutions any time soon.
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09:15 AM on 11/29/2011
Free college education?

Heck no--not unless the degree programs DIRECTLY and RELIABLY lead to meaningful private sector employment.

And even then, student's can work-study their way through college, by providing some of the underserved "public-sector" roles the author claims need be filled--home health care, maintenence, etc.

THAT would demonstrate a return to the social-contract of the halcyon days of the author's youth...
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jmpurser
See My micro-bio
10:31 AM on 11/29/2011
Yes, because if you don't make a buck off it then Education is just wasted right?
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11:52 AM on 11/29/2011
No.

If you can't PAY FOR IT, then it is just wasted.

Education bubble is the next to "pop".
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JScott
John Galt's last name is McGuffin-Smithee
10:35 AM on 11/29/2011
Indirectly it's not free, it's taxpayer subsidized, but the mantra for the electorate and politicians is lower our taxes no matter what since Ronald Reagan was governor.
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12:11 PM on 11/29/2011
Ask the average taxpayer in CA if their taxes have been "lowered".

Prop 13 property tax relief was an absolute blessing to the lowest fixed-income resident's, but perhaps it is time for SOME modification of the law.