L.A. fires shine light on broader CA'n issue of misguided, unsustainable spending
Nicolas Régnier: The punishment of Midas (1626-1667). Image by Wikimedia Commons
According to Pirate Wires mag, the many and widespread failures of local gov't during Los Angeles' fires point to a larger problem in CA: We're not prioritizing funding core services. But we are making it rain taxpayer dollars for excessive gov't pensions, ideologically slanted unions, and unaccountable (failing) homelessness initiatives.
Watching Los Angeles burn, it is hard not to think of the fractal-like ways in which America’s governments — local, state, and federal — have failed the residents of America’s second-largest city. State and federal environmental permitting laws made prudent fire prevention close to impossible. Mismanaged water resources meant that firefighters had no ammunition. Public land — especially the land owned by the state and municipal governments — was left without basic preventative care. California’s price-controlled property insurance system barred homeowners from receiving market signals about the riskiness of their properties. Amid the chaos, Los Angeles’ fire departments were overwhelmed. As their homes and schools and churches burned, perhaps some Angelenos, rich and poor alike, wondered whether they, too, were now on their own.
It’s hard to know when, exactly, the shocking decline in state capacity that is an ambient part of our daily life began. Many of the laws mentioned above date to between the late 1960s and the 1980s, and many more laws have piled on since then. Left to enforce these laws are a complex web of government agencies with vague and often overlapping mandates.
The supporters of these agencies might say they are “chronically underfunded,” but in truth California spends more on government than nearly any society in the developed world. Combined, California’s state and local government entities spent, conservatively, nearly $600 billion in 2021 alone. Vast amounts of that — nearly $75 billion in 2024 — are used to pay for the six-figure pensions guaranteed to public employees from retirement to their death. And even with that, the pension system is only 72% funded, leaving a $150 billion liability that there is, simply put, no real plan to deal with beyond kicking the can down the road. Untold billions also go to quasi-governmental nonprofit “social service providers.” Often, these billions truly are untold: the Governor has, for example, consistently vetoed spending transparency efforts in the state’s immense homelessness system. Last September, just months after a state audit revealed that California spent $24 billion on homelessness programs over five years but did not consistently track or measure outcomes, Newsom vetoed AB 2903, which would have required state-run homelessness programs to report cost and outcome data annually. A year before that, he vetoed AB 2570, which would have required annual reviews of state funds allocated to cities and counties for homelessness initiatives.
None of this should come as a surprise. California’s government is, increasingly, in business for itself rather than for its citizens. Many of the most powerful interest groups in the state are government interest groups, namely public sector unions. The majority of California’s unionized workforce are government employees; 60% of the government workforce is unionized, compared to less than 10% in the private sector. These public employees’ union dues — often deducted directly from their paychecks — fund roughly $600 million in union political activity throughout the state every two years. Thus, every taxpayer in California is obligated to fund political activity that most estimates suggest skews heavily toward funding Democratic Party candidates.
In other words, government employees and their representatives drive the political economy of the state. Their blessing is a de facto requirement for successfully holding almost any elected office in California. It is not a surprise that the system works this way. It is not even a failure. It is, instead, the system working as designed. The problem is that the system doesn’t live up to the basic agreement between the people and the government that is supposed to be at the foundation of a republic.
All that largesse is funded disproportionately by the wealthy (and by debt) — even by the standards of most progressive income taxation regimes: just 0.05% of California taxpayers pay around 20% of the state’s income taxes. Many of those same households also pay a disproportionate share of California’s highest-in-the-country capital gains taxes. Many of these people just saw their houses burn down, owing in large part to the incompetence of the government they pay so heavily for.
Eventually, those people are going to wonder what it is, exactly, that their money buys them. Many are probably asking themselves that very question now.
Read the whole thing here (behind paywall).
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