California: Our very own failed state

The state that once had it all, said The Washington Post in an editorial, all of a sudden doesn’t have much of anything. Formerly the optimistic, laid-back home of movie stars, surfers, and sunshine-seeking lovers of the good life, California today boasts unemployment of 11 percent, a budget deficit of at least $21 billion, and the prospect of imminent fiscal collapse. Unless Gov. Arnold Schwarzenegger can come up with $5.5 billion in the next few weeks, California will simply “run out of money.” Borrowing probably isn’t the answer, as California’s credit rating is currently the lowest of the 50 states. In a special election last week, Californian voters emphatically rejected Schwarzenegger’s latest revenue-raising scheme, humbling a man who used to routinely achieve the impossible in his movies. “This means cuts, cuts, cuts,” the glum governor said.

Cuts may be the answer in the short run, said George Skelton in the Los Angeles Times, but the state’s dilemma won’t be solved permanently by laying off thousands of teachers and government workers, and cutting social-service benefits. The real problem is that California has become ungovernable. The state is locked into cripplingly expensive labor contracts with public-employee unions, which largely call the tune for Democrats in Sacramento. But thanks to California’s proud tradition of “ballot initiatives,” voters have imposed a series of conflicting restrictions on their lawmakers, who are required both to balance the budget every year and secure a two-thirds majority for any tax increases. Majorities for any painful decisions are almost impossible to achieve, said Dan Schnur, also in the Times, because of a “redistricting process that elects only the most conservative of Republicans and the most liberal of Democrats” to the state legislature. California is therefore caught between the wishes of big-spending liberals and angry populist tax-cutters, with no means of resolving their ongoing dispute.

Therein lies the danger, and the lesson, for America, said Paul Krugman in The New York Times. Political extremism has transformed California into an ungovernable “banana republic.” The Republican minority in the state’s Assembly has decided to “block any responsible action” to raise revenues, taking some solace for its lack of power by causing paralysis and chaos. Fortunately, on the federal level, Congress doesn’t require a two-thirds majority to take reasonable measures to stave off catastrophe. But if the old principle holds that California is where “the future happens first,” then “God help America.”

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