California Gov. Jerry Brown introduced his final budget last week. For a sense of perspective, the first general-fund budget he introduced back in 1975 was for $11.5 billion. His final one spends $132 billion — a whopping $190 billion if we included total spending from all special funds. It’s 44 percent larger than the budget he introduced in 2011, per news reports. This much is certain: Our state government certainly is good at getting its hands on our money.
You can’t totally blame Brown. This is the sad trajectory of government spending at all levels, regardless of which politician is in charge. Democrats love to spend money, but so do Republicans. I’ve been asked whether, on balance, was this was a good budget. Absolutely not, but it’s the best budget that Californians are likely to see in our lifetime. And that’s the endless conundrum in California. We won’t ever get anything good. When do we settle for less bad?
Our next likely governor, Lt. Gov. Gavin Newsom, recently touted a single-payer healthcare system. The Democratic Senate actually approved a version of a single-payer plan last year. It ultimately was killed after no one could figure out how to pay for it, but lawmakers voted “aye” even after the Senate’s own analysis found that the cost would be $400 billion, or three times the entire general-fund budget. It’s coming back again, now that this idea has become a litmus test for California Democrats.
Indeed, Brown’s final budget was indicative of his entire modern administration (as opposed to his terms in the 1970s and 1980s). Brown clearly wants to spend as much money as possible, but he wants to make sure the state can actually afford to do so. That has put him at odds with a Democratic-dominated Legislature that increasingly makes Bernie Sanders sound like a moderate. Such reasonableness has warranted myriad accolades for his “fiscal conservatism.” Such is the state of affairs in modern California.
And, indeed, his latest budget did have some noteworthy features. In releasing his final budget, Brown urged “legislators to squirrel away most of the state’s projected $6.1 billion surplus as he warned of the next economic downturn and potential cuts by the Trump administration and the Republican-controlled Congress,” reported the San Jose Mercury News.
Yes, it’s wise to plan for a downturn and reduced revenues. Yes, the surplus is nice, although it reinforces the unnecessary nature of the supposedly vital $5.2 billion tax increases he imposed on gasoline and vehicle licenses. It also reminds us that Brown has largely been about raising taxes as a means to afford an ever-expanding state bureaucracy.
Storing away more cash than necessary in the state’s rainy day fund is a good, albeit modest, idea. Even better would be taking on California’s overly progressive, capital-gains-dependent tax system, which Brown admits is the source of its endless boom-and-bust cycles. But Brown never used his political capital to take on the unions that assure that California vastly overspends and under-delivers on every conceivable public service. Or to revamp the tax code to keep job-producing businesses from fleeing to Nevada and Texas.
I do love his big charts that remind us that recessions always are around the corner. Brown trots them out during every budget press conference, as a way to remind legislators that creating permanent new programs will once again lead to those Gray Davis-era deficits of $38 billion or more once the stock market decides to head in a downward direction. That’s welcome news in a Capitol that knows nothing other than more spending.
And Brown was true to form in rhetorically taking on some of the state’s vested interest groups. He reminded us that when a recession comes state pensions will be “on the chopping block.” In one of his best, but belated, moves the governor filed a legal brief with the state Supreme Court essentially arguing that the court should amend the “California Rule,” which forbids the government from cutting even the most unaffordable pensions.
But it’s hard to forget that Brown spent his early terms empowering the same public-sector unions that have created the state’s unsustainable pension mess — one that routinely pays out six-figure retirement deals to people who retire as early as 50 and is causing cities to slash public services. It’s clear that Brown understands the depth of the fiscal problems some of these deals created, yet he has literally waited until others are measuring drapes in the governor’s mansion before he decided to take any serious whacks at the problem.
I’ll always admire him for putting an end to the state’s ham-fisted redevelopment agencies, even though he has allowed them to come back in more limited form — and he never reformed the eminent-domain laws that allowed those agencies to be so abusive. Typical Brown.
Spectator readers from outside California understandably view Brown as a wacky leftist who has traveled the globe using apocalyptic rhetoric about climate change — and as someone who has repeatedly blasted the Trump administration. That’s true, but many of us in California see it a bit differently. Despite his many flaws, Brown is a smart guy who understands the depth of the state’s fiscal problems and has a penchant for taking unorthodox — and even conservative — positions on occasion.
But instead of using his vast political capital to take on entrenched interests, reform the pension system, improve the schools and gain control of bloated bureaucracies, he stuck with just competently managing the current Leviathan. He has assured that the budgets are balanced and there are plenty of reserve funds. But he’s never gotten control of spending, nor has he really tried. He has raised taxes while sticking with his $68 billion plan to build a needless high-speed rail line that connects the Bay Area with Los Angeles — a project that has once again busted its spending projections.
Brown is leaving the toughest problems for the next governor, but his predecessor will no doubt be aligned with the kind of Democratic legislators who think it’s a sensible idea to offer “free” healthcare to all, regardless of the costs or consequences. So was the Brown administration a good one? Of course not, but let’s brace ourselves for what comes next.
Steven Greenhut is Western region director for the R Street Institute. Write to him at email@example.com.