Occupational licensing requirements have a widespread and deep reach in California. The Golden State ranks 7th in the nation for licensing burden, with a total of 62 low-income occupations licensed and requiring an average of 549 days of education. These licenses have cast a wide net, with one out of every five Californian’s needing to receive permission to work from the government . By restrict entry into the market occupational licenses also result in lower job growth. Specifically, licensed industries experience up to 20% lower job growth than their unlicensed counterparts. This has prevented the creation of 3 million jobs nationally, according to a study from the Upjohn Institute for Employment Research. Occupational licenses also increase wages at the cost of consumers. While we can cheer hooray for those licensed workers who now enjoy 15% higher wages, the party is ruined for consumers who now fork out an additional $203 billion a year. In fact, the increase in consumer prices in licensed industries ranges from 5% to a whopping 33%.
Oblivious to the fact that these corporate and personal earnings [or just “earners”?] can move to other states or even other countries, Sacramento recently increased the gas tax and car tax by over $5 billion annually. The politicians do not spend this money well. Our freeways, once the envy of a great nation, are an embarrassment. Our dams, once an engineering marvel, threaten hundreds of thousands without warning because maintenance is deferred to cover up pension debt. The CalTrans budget was $13 billion in 2010, the year Governor Brown took office; by 2013, it was reduced to $11 billion. So here is the formula Sacramento politicians have dreamed up for sending our shining stars to other states: tax more, then spend less on the things that matter. Sacramento knows about this problem, but as usual, its solutions are ham-fisted. Here’s an example. Politicians paid Paramount Studios $22 million in tax bribes to film one of the myriad installments of “Transformers” in California instead of taking its business to another state. This is only one of the films in the Transformers “cycle” to be filmed in California; others have been shot in China, Britain and in other states. To keep some of the action in California, Sacramento has created a huge taxpayer-supported fund to help finance films with budgets of $75 million or more “to entice more major motion pictures to choose California and reverse the tide of runaway productions”. According to the LA Times, “California officials hope that more in-state film shoots will help spur local economics through spending and hiring.” Making crony deals with billion-dollar corporations will not stem the flow of our young entrepreneurs from California; it just makes them shake their heads at the pathetic condition of the state they used to love.
When we split obligations into how much California owes to those who have already retired and current employees, a startling fact emerges. The assets California governments have now aren’t even enough to cover what it owes to current retirees. For all employees combined, retirees are owed $134.5 billion as compared to $112.6 billion in total assets. California governments do not have enough money to pay what they owe retirees, and they have nothing at all set aside for current employees. Every year, employees have funds deducted from their paychecks to go into the pension funds. Those funds will go to retirees. By the time it’s their turn, there will be no money left for current employees. Current employees are forced to pay into a retirement system that may be bankrupt when they retire.
Legislators are about to require that private-sector workers in the home-care industry provide a wide range of personal information – home address, email contact, cell-phone number – to any labor organization that wants it. Those unions would then be free, at their discretion, to pester these workers into joining the union. The bill only affects one industry, but the precedent is clear
In Santa Barbara County, the 2017-2018 budget calls for laying off nearly 70 employees while dipping into reserve funds. The biggest cuts are to the Department of Social Services, which works to aid low-income families and senior citizens. Meanwhile, $546 million of needed infrastructure improvements go unfunded as Santa Barbara County struggles to pay off $700 million in unfunded pension liabilities. County officials estimate that increasing pension costs may cause hundreds of future layoffs. Unfortunately, Santa Barbara County is far from alone. Tuolumne County is issuing layoffs in the face of rising labor and pension costs from previous agreements. In Kern County, a budget shortfall spurred by increased pension costs has led to public safety layoffs, teacher shortages, budget cuts, and the elimination of the Parks and Recreation department, even as Kern County’s unfunded pension liability surpasses $2 billion. In the Santa Ana Unified School District, nearly 300 teachers have been laid off after years of receiving pay raises that made them unaffordable, including a 10% raise in 2015.