Freedom Foundation

Thanks To Unions, California’s Finances Are Collapsing

Originally published by the Daily Caller on Nov. 30, 2018.

Feedback loops, the circle-of-life, the Ouroboros – the serpent that eats its own tail. California politics might not be the first place you’d think to look for science and mythology lessons, but these themes are being played out in our state with dramatic consequences.

For almost a half century, California has been caught in the grips of an incredibly powerful government-union feedback loop in which politicians allocate tax dollars for pension liabilities; government unions return the favor by giving the money to those politicians in the form of campaign contributions.

The government union feedback loop in California is a well-oiled and well-funded machine, designed to near-perfection for over 40 years, and ruthlessly executed with government’s complicity:

  • It is entirely funded by California taxpayers via some of the most regressive taxes (I’m looking at you, sales tax) and revenue schemes, hurting most the millions of low and middle-income families who can least afford it;
  • politicians place these tax increases on state, county and municipal ballots every year and sell them as anything but what they really are: a way for the politicians to pay down government pension liabilities and fund other debt service they created; and,
  • the politicians, and the campaigns to pass the tax measures, are heavily funded by government unions that directly benefit from higher taxes and increased government spending.

As the government union feedback loop spirals-on and intensifies, it stands to eventually choke our golden state, as evidenced by election data compiled by California city finance guru Michael Coleman. This past November, California voters were presented with a whopping 386 local tax and bond measures. Among those, they passed 51 of 53 majority-vote sales tax measures, increases ranging from an eighth of a percent to 1.5 percent — a stunning .962 batting average.

Since 2006, the rate at which politicians have asked for any kind of local voter-approved tax-increases has nearly doubled; and, as one of California’s leading state watchdog columnist Dan Walters has astutely noted politicians are getting increasingly savvy about packaging those increases to disguise their primary use: funding government employee pension debt.

And what do we have to show for it? A state that is barreling toward economic catastrophe with politicians coming up with new taxes to keep the runaway train in motion: the 2018 state budget topped $200 billion in spending, up 53 percent in just eight years; estimates put CalPERS and CalSTERS unfunded pension liability at nearly $1 trillion; and California holds the dubious distinction of having the highest taxes in the nation.

While this unsustainable cycle operates as a never-ending automatic teller machine for government unions and politicians, it is a prison for California taxpayers and businesses and for workers who disagree with the political causes and candidates supported by their unions; a prison they’ve been trapped in for over forty years, until this past June when the US Supreme Court issued its landmark decision in Janus vs. AFSCME.

Janus is a generational game-changer. Union membership is no longer a condition of employment for the 1.2 million government employees in California, which gives champions of free enterprise and lovers of freedom the chance to end the government union feedback loop by helping workers opt-out of their unions, costing unions millions, putting unions on defense for the first time in a generation, and reversing the epidemic, auto-pilot nature of California’s tax-increase by ballot measure system.

Thousands of California government union employees have already exercised their right to opt-out, and more will follow, driving a much-needed dagger into the heart of this venomous cycle – while restoring hope by breathing new life into the effort to save California before government unions bankrupt it.