Join us live Tuesday, 10 a.m. PDT, on CRNtalk.com, CRN1, for another spirited edition of Gadfly Radio with Martha and CalWatchDog.
Martha Montelongo could not stay away from the microphone for long, so she’s returning from her road trip a week early!
In the first half of the program, we’ll talk to Jim Manzi, author of the new book, Uncontrolled: The Surprising Payoff of Trial-and-Error for Business, Politics, and Society. Manzi, a senior fellow at the Manhattan Institute and the founder and chairman of Applied Productive Technologies, argues “we have much less formal knowledge about society than economists and other social scientists often claim, and that therefore we need to rely predominantly on practical expertise, federalism and trial-and-error learning to make useful progress.” It’s a fascinating book, and should make for a fascinating discussion.
Then, John Seiler, Ben Boychuk and Martha Montelongo will discuss some of the latest developments in California, including the pitch battle over Proposition 29, the “Tobacco Tax for Cancer Research Act.” If approved, Prop. 29 would raise the cigarette tax by $1, with the money ostensibly earmarked for cancer research.
Prop. 29’s backers are trying to portray the measure’s opponents—which do, in fact, include tobacco companies—as objectively “pro-cancer.” L.A. Times columnist George Skelton flatly asserts that Prop. 29 will save countless lives, and that opponents of the tax increase are simply lying to protect Big Tobacco. And in a column at California Progress Report headlined “The Friends of Lung Cancer,” former Sacramento Bee editorial page editor Peter Schrag writes:
There are lots of good reasons to support Proposition 29, the tobacco tax initiative on the June 5 ballot, not least those named Philip Morris and R.J. Reynolds. Together, the two tobacco giants have so far kicked in about $40 million to the sleazy campaign to defeat it. If you count the nearly $700,000 that the Republican Party contributed to their cause you have yet another reason.
Incredibly, Schrag comes out in qualified opposition to Prop. 29, saying, “Anything that big tobacco is against – or big pharma or big oil – is usually good enough to be for. But let’s save it for a more worthy purpose next time around. There’s a long list of underfunded programs that can badly use the money.” Well, alrighty then!
The problem with Prop. 29—well, one of them, anyway—is that it would create yet another new agency with an unreliable revenue stream in a state beset with a multi-billion dollar deficit. Remember Prop. 71? That was a 2004 bond measure that set up a mostly unaccountable new agency responsible for spending billions on stem-cell research. The Sacramento Bee reported Monday that the California Institute for Regenerative Medicine is now in danger of running out of money.
And as CalWatchDog’s Katy Grimes noted last month, Prop. 29’s backers have plenty to gain if the measure passes: “Don Perata, a former state legislator, has been using the June ballot measure’s election fund as his own personal checkbook. Perata has paid nearly $40,000 to an Oakland City Councilman in order to win a contract for one of his lobbying clients, the San Francisco Chronicle and Contra Costa Times reported.” Grimes also reports that Prop. 29 includes “a clause prohibiting any changes in the spending decision that its politically appointed commission makes, for a full 15 years.”
What’s more, the measure, “is written in a way to exempt the CEO from normal state salary requirements, and why that CEO can hire whomever he wants, at whatever salary he chooses.”
How bad is California’s economy? People are voluntarily returning to Mexico. John Seiler at CalWatchDog lays out the numbers in “American Dream Goin’ South,” which highlights the reverse migration of Mexicans from California. John writes:
Although the official California unemployment rate is 10.9 percent, the real level — including those working part time who want to work more and those who have given up looking for work — is 25 percent, just as during the 1930s, as I have reported.
A difference this time from the 1930s is that Mexico’s economy is not also in a slump, but is a hot tamale:
“First-quarter growth was 4.6 per cent compared with a year earlier, the fastest pace since the third quarter of 2010, prompting several analysts to upgrade 2012 growth forecasts.”
Other items of note:
- “California’s salary setting commission is bracing next week to consider a 5 percent pay cut for legislators and other statewide officeholders, in keeping with a similar cut proposed by Gov. Jerry Brown for state workers,” reports Jim Sanders at the Sacramento Bee.
- “Executives at California State University campuses would be prohibited from getting public pay increases during the next two years and then limited to 10% raises during the next four years under legislation approved Monday by the state Senate,” according to the Los Angeles Times. CalWatchDog’s John Hrabe has been on the cutting edge of reporting on the Cal State executive compensation scandal. Read his latest report here.
- During last week’s episode, Ben and John discussed California’s exploding budget deficit, including the state’s high hopes for billions in new revenue from the Facebook IPO. City Journal contributing editor Joel Kotkin argues at The Daily Beast that Facebook won’t save the Golden State. Meantime, Facebook shares on Monday closed near $34 on the second day of trading—or about $4 below the stock’s initial offering price. Yikes.