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deficits and debt tax policy

Deadbeat California

The injustices pile up so thick and fast that one can’t really keep track. Some state governments are especially prolific in producing them. Governments like the Deadbeat State, formerly known as the Golden State.

Now businesses in California must pay the price for the state government’s profligacy during the pandemic, when it borrowed $20 billion from the federales to help pay unemployment benefits. California is refusing to repay.

In the budget proposal for 2023 – 2024, $750 million had originally been set aside to begin repaying this debt. But Governor Gavin Newsom killed the provision. So, in accordance with federal regulations, businesses must take up the slack. Starting in 2023, the unemployment tax rate that businesses will pay, which had been 0.6 percent, is being increased by 0.3 percent until the loan is repaid.

“California is just not really an employer-​friendly state,” says Marc Joffe of the Cato Institute. “This one thing will not be a difference between a business remaining open or closing, but it’s just another burden on top of the many burdens the state puts on employers.”

A major contributor to the size of this debt is the state’s failure to act to prevent massive fraud in filings for unemployment benefits. LexisNexis estimates that fraudulent payments amount to more than $32 billion.

California taxpayers must pay for this unsalutary neglect one way or another. But what Newsom has done ends up penalizing businesses in particular. 

Yet another reason to avoid doing business in the state.

This is Common Sense. I’m Paul Jacob.


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initiative, referendum, and recall media and media people

Democracy Fail?

“California recall fails,” The Visalla Times Delta explained. As did KSBY, the NBC affiliate in San Luis Obispo. Not to mention The New York Daily News and The Chicago Sun-​Times.

FiveThirtyEight analyzed “the failed California recall” at length. Even the South China Morning Post proclaimed the apparent democratic malfunction (reprinting an Agence France-​Press report).

Yet the recall did not fail.  

Sure, voters decided not to jettison Governor Newsom mid-​term. But that’s not a failure of this century-​old democratic check on power — not unless a whole bunch of the 64 percent voting to keep Newsom filled in the wrong oval on their ballot by mistake.

I almost wish that were so; it would be easier to correct going forward.

“In a state famous for its acts of direct democracy,” a New York Times feature informs, “detractors of this year’s special election say the recall process is democracy gone off the rails, a distraction from crises that require the government’s attention, and a waste of hundreds of millions of dollars.”

Some folks never complain about government spending until it comes to the cost of holding an election. Funny, that’s precisely when our money might actually be well spent.

“No one in the state’s Democratic leadership is suggesting the elimination of recalls,” The Times notes, merely “vowing to make it more difficult for them to qualify for the ballot.”

In other words, legislators intend to raise the cost … so as to fight wealthy interests, they’ll argue. With a straight face.

“In a sharp piece of political irony,” that Times’ piece bemoans, “it will take a referendum to decide whether to change this particular referendum.”

Which is a feature of the system, not a bug. That is, no fail there

This is Common Sense. I’m Paul Jacob.


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initiative, referendum, and recall

Recall Legal Scholars?

“For weeks, legal scholars have debated whether the recall election of [California] Gov. Gavin Newsom could be found unconstitutional,” The Los Angeles Times reports, “if Newsom failed to realize a ‘no recall’ majority of the ballots cast and was ousted by a candidate who received fewer votes than he did.”

By “failed to realize a ‘no recall’ majority,” writer Maura Dolan means — in normal lingo — that Newsom gets booted out of office by majority vote. But following that phrase with “ousted by a candidate who received fewer votes than he did” ignores precisely who just did the “ousting” or, if you prefer, “booting” — voters.

Her confusion was mightily assisted by University of California at Berkeley academics, Law School Dean Erwin Chemerinsky and Professor Aaron S. Edlin, economist, arguing in The New York Times that the recall is “nonsensical and undemocratic.” Oh, and “unconstitutional,” too, because more votes could be cast to keep the incumbent than for the incumbent’s replacement. 

“Every voter should have an equal ability to influence the outcome of the election,” they contend.

A Golden State recall petition results in two separate elections: (1) the voters’ up-​or-​down decision on keeping or recalling the official in question, and (2) a second election for voters to choose among candidates running to replace that official should the recall succeed. 

Every Californian casting a ballot on these two separate issues indeed has an equal vote. The recall is automatically decided by majority, while the replacement could win with a plurality.

The equal protection angle has been raised unsuccessfully before. In fact, Chemerinsky acknowledged, according to the LA Times, “that courts could decide that the recall proposal itself amounted to a separate election from the second question on the replacement candidates.”

No duh.

The authors should be glad that recalling academics isn’t a thing — even so, they’re not as awful as Governor Newsom.

This is Common Sense. I’m Paul Jacob.


Blast from the past: This column addressed opposition to the 2003 recall of California Gov. Gray Davis.

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incumbents initiative, referendum, and recall

Christmas in California?

“Gray Davis was never in a position to play Santa Claus,” said Steve Maviglio, press flack for the former California governor who was recalled by voters in 2003.

Maviglio was comparing Davis’ relative misfortune, back then — in not having a pandemic and the resulting economic stimulus — to today’s prospects for current Governor Gavin Newsom, who likewise faces a citizen-​initiated recall. Yet, while 18 years ago Davis both cut budgets and raised taxes, Newsom has now discovered an extra $100 billion of spendable funds to let him off that hook. 

California’s whopping budget surplus of $75.7 billion? Just the beginning. Democrats in Congress wanted to help with even more tax dollars, voting to drop-​ship Golden State pols another $26 billion as part of the stimulus bill … which every Republican opposed, calling it at the time a move to “supply the Governor of California with a special slush fund.”

“Newsom wants to hand out cash before California recall election,” Politico headlined its story on Monday, informing that the embattled governor was quick to “tell Californians he wants to give them cash and pay some of their utility bills and back rent,” and noting specifically: “Checks would arrive in voters’ mailboxes not long before ballots do this fall.”

One key part of Newsom’s $100 billion “California Comeback Plan” is to give $600 “to some two-​thirds of state residents in households making up to $75,000, along with $500 to families with dependents.”*

“It’s very significant,” offered former Gov. Davis, arguing “the future looks brighter as evidenced by the checks the public will soon receive.” 

Whose future, precisely? Not Californians, really. Newsom’s.

This is Common Sense. I’m Paul Jacob.


* “Unlike the federal stimulus aid, undocumented immigrants and their families will be eligible to receive a state tax rebate,” The Sacramento Bee explained. “In fact, undocumented immigrants with dependent children will be eligible for $1,000 for family checks, double what other California families will receive, in order to make up for the lack of support at the federal level, according to Finance Director Keely Bosler.” [Emphasis added.] Must they document that they are undocumented?

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initiative, referendum, and recall

Pols Don’t Like Recalls

California State Senator Josh Newman has, for now, withdrawn a bill to let elected officials facing a recall see the names of petition signers so that they may be asked if they really mean it.

The Democrat complains that critics call his bill “an attack on not just the recall but on them and their constitutional rights. It wasn’t a good context to have a conversation.” 

So unfair!

The willingness of defenders of petition rights to speak up does sound pretty inconvenient for foes of this popular democratic check on power.

Perhaps we’re supposed to believe that under Newman’s legislation, the interviews would go like this: “Did you mean to sign the petition to recall me?” “I did.” “Just checking. Bye.”

Obviously, the targeted official’s opportunity and authority to quiz petition signers would enable his team to intimidate existing and prospective signers. The aim? Try to prevent a question with enough valid signatures from reaching the ballot.

Years ago, in other states, opposition campaigns sent retired FBI agents to knock on doors. Legal, but very intimidating. Which is why California does not make the names public.

The legislation would not have applied to the current petition drive to recall California Governor Gavin Newsom, an effort going splendidly with more than 1.5 million signers. But Newman’s bill was clearly motivated by the success of this campaign. 

Or perhaps it’s residual animosity toward the recall process … from Sen. Newman himself, having been recalled by voters in 2018. (He came back to win election once again in 2020.)

Of course, signing a petition in itself says “I want this question on the ballot.” If a petition signer changes his mind, there is a process to retract it. No bullying follow-​up needed.

This is Common Sense. I’m Paul Jacob.


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general freedom national politics & policies

Sue the Governors!

Expect a tsunami of lawsuits against state and local governments. The lockdowns, mask mandates, and other putative ‘mitigation efforts’ to combat the spread of SARS-​CoV‑2 and COVID-​19 demand a deluge.

The latest is Burfitt v. Newsom, filed in Kern County’s Superior Court of the State of California.

“The legal complaint,” explains Matthew Vadum in The Epoch Times, “seeks declaratory and injunctive relief for the constitutional violations it alleges have been committed by [Governor Gavin] Newsom and his officials, stating that the ‘lockdown was originally supposed to be only a temporary emergency measure. However, nearly seven months later it appears that, absent judicial intervention, there will never be a “reopening” to normal, pre-​COVID activity, despite incontestable facts — including California’s own data … showing that the lockdown is no longer warranted and is causing far more harm than good.’”

The plaintiff is Father Trevor Burfitt, who simply seeks to carry on the established rites of the Roman Catholic Church. 

Though churchgoers and other observant religious people are increasingly defiant, politicians are generally following New York Governor Andrew Cuomo’s lead. Cuomo says* his edicts apply regardless of religious affiliation: “the community must agree to the rules. If you do not agree to enforce the rules, then we will close the institutions down.”

But Cuomo’s “must” is actually iffy:

  1. The states of emergency do not pass the smell test, as the medical infrastructure the lockdowns initially were touted to defend are actually under scant stress.
  2. The basic right at issue here is beyond ecumenical, it is the freedom to peaceably assemble, which too many governors have attacked, though
  3. they have indeed been hardest on religious gatherings, despite being lenient with big box retailers, liquor stores and marijuana dispensaries and completely tolerant of ‘mostly peaceful protests.’

The biggest If, though, is what would happen were the litigation to fail. 

Citizen political action must join the litigation wave.

This is Common Sense. I’m Paul Jacob.


* Mark Tapscott quotes Cuomo’s bracing statement in The Epoch Times, “Silicon Valley Pastor Fights $220,000 in Fines by California Officials for Holding Church Services.”

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