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California Democrats, Deep Pockets, and Ideological Irrelevance

Ankur Chawla
July 5, 2012, 6:54pm

California legislators have agreed on a budget deal that satisfies their adopted special interest groups while crippling California residents across the spectrum.  This time around it is especially interesting because, believe it or not, legislators have agreed to cut numerous welfare programs in order to protect the interests of public sector unions in Sacramento.

Governor Jerry Brown and the state legislature reached a deal on a balanced budget in the state of California for the upcoming fiscal year, beginning on July 1, 2012.  The $92 billion budget for FY 2012-2013 is facing a projected deficit of $15.7 billion, which the budget deal attempts to close through a combination of cutting or shifting funding for a number of social service programs, and raising revenue through an ambitious November ballot initiative that attempts to amend the California Constitution in order to raise the sales tax and increase state income taxes on those who earn over $250,000 annually (keep a look out for Reason's upcoming commentary on this hefty tax package).

What stuck out while the budget was being negotiated last week was the sheer amount of power that public unions have over budgetary spending in Sacramento.  Even while entertaining deep cuts to welfare and education programs, California lawmakers refused to pass Governor Brown's budget while it contained language that would cut hours and pay for public workers.  The notion that Democratic legislators tragically accept budget cuts when it comes to helping the poor and marginalized while simultaneously fulfilling favors to public unions is astounding.  According to Bloomberg, they rejected a proposal to authorize furloughs (unpaid days off) if unions didn't agree to a one-year 5% deduction in payroll.  Furthermore, they took out language that allowed the use of private contractors in place of public workers to save money.           

Democratic lawmakers rejected a proposal in the May Revision of the governor's budget, which called for a 7% cut in hours to public workers in In-Home Supportive Services (IHSS), a state program that provides personal care to senior citizens in their homes, which saves taxpayers $225 million.  Here is the official language:

"Across-the-Board Reduction in IHSS Hours - The May Revision reflects a decrease of $99.2 million General Fund in 2012-2013 from a 7-percent across-the-board decrease in authorized hours effective August 1, 2012.  Similar to the 3.6-percent across-the-board reduction that under current law sunsets on July 1, 2012, recipients may direct the manner in which the reduction of authorized hours is applied to previously authorized services."

The plan was to cut hours by removing tasks such as doing laundry from the assigned duties of in-home workers.  California lawmakers led by Assembly Speaker John Péréz and Senate President Pro Tempore Darrell Steinberg balked at this idea.  While these 'heroic' lawmakers fought to protect the rights of workers to get paid by taxpayers for doing the laundry, they said not a word about, for instance, the state cutting the Healthy Families program.  This program, which provided health insurance for 880,000 poor children, shifts the children to the purview of the largely inefficient Medi-Cal program.

Unions, especially those in the public sector, have had a pervasive influence and deep pockets in California politics.  During the 2010 election cycle, unions contributed almost $75 million to politicians and ballot initiatives, according to the National Institute on Money in State Politics.  And earlier this month, a number of unions called upon their members to hold protests in Sacramento against cutting their hours, branding it as a campaign to save the money and lives of "California's most vulnerable residents."  All this while ignoring the almost $1 billion in cuts on welfare-for-work programs for poor residents and the 8.7% cut in funding for children in low-income families.

This is not about the merits of state social programs. It is about the disconnect between Democratic state legislators' rhetoric vs. their power politics.  When our 'leaders' in the state legislature decided to stoically accept the situation, shake their heads, provide some choice quotations for the media and resignedly concede to welfare cuts while simultaneously scratching the backs of entrenched public unions, they made it clear that this was more about political expediency than anything else.  And is it so surprising?  A quick search reveals that Assembly Speaker John Péréz, a powerful figure in Sacramento and key opponent of Brown's IHSS payroll cuts, has deep ties to well-funded unions.  Indeed, his biggest campaign contributors were trade unions and public sector unions, with almost 88% of contributions coming from outside of his district.  Assembly member Bob Blumenfield, the Chairman of the Assembly Budget Committee, also received his largest campaign contributions from unions, with as much as 93.2% of the contributions coming from outside of his district (the "representative" from Southern California received most of his campaign funding from Sacramento).

The branding and rhetoric on the part of the politicians and unions has been painfully and disappointingly typical.  Steinberg, when asked why he rejected the furloughs, said that he simply wanted to give the unions more time to negotiate.  Péréz stated, "We have worked hard to preserve In Home Supportive Services for the thousands of Californians with debilitating medical conditions who rely on the support from IHSS caregivers to ensure they can live independently, at lower cost to the tax payers."  SEIU Local 1000, California's largest public union, argued in a statement that the IHSS cuts in hours would, if passed, "put vulnerable seniors and people with disabilities and people with disabilities in danger."  And one union executive by the name of Bruce Blanning made the case that outsourcing jobs to private companies would be more costly than using salaried public workers. 

It is hard to believe that politicians with vested interests in union well-being are fighting for the benefit of California's worst-off residents.  The sugar-coated rhetoric from the lawmakers like, "We know our loved ones would rather be cared for in their own homes by providers who want to stay them say healthy" is dishonest at best.  The argument that exorbitant and unnecessary social programs save taxpayer money is deceitful, the logic inconsistent.  And the insistency of the unions that outsourcing public programs to private contractors is more expensive than investing in public worker salaries and pensions is asinine.  It seems these smoke and mirror arguments exist because, for whatever reason, these California lawmakers like to pretend to hold some semblance of an ideology while conducting their backroom dealings.  Let it be a lesson: deep pockets are a far more lucrative sell for these California lawmakers than ideological consistency will ever be.


Ankur Chawla is Research Assistant


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