The First Runner-Up in This Year's Daily Reckoning Dodo Derby

Population: 37.5 million.
Unemployed: 2.2 million.
Food stamp recipients: 3.7 million.
Total debt: $367 billion.
Debt/GDP ratio: 18.80%…

And, finally…

Total state debt per man, woman and child – working or not: $9,835!

Ladies and gentleman, Fellow Reckoners, people who enjoy overly dramatic, entirely non-scientific countdowns…

The First Runner-Up in this year’s newly-renamed Daily Reckoning Dodo Derby is…

The Golden State of California. Congratulations!

Now, before we get all carried away with the celebrations, a couple of quick words…

Your editor happens to enjoy a few drinks with a couple of California locals when he visits that paradisiacal stretch of coastline from time to time. One such local happens to be his senior editor, Eric Fry, who resides in Laguna Beach, home of the ever-vigilant Tsunami watchmen. As such, we feel it would be somewhat unbecoming of us to launch into a crassly gratuitous, politico-bashing tirade about a state in which our good friend happens to reside – and in which we do not.

So, we’re going to let our Fellow Reckoners do it for us; Fellow Reckoners who, mind you, also happen to live in California and, therefore, should know better than us about the goings on there.

First up, from Reckoner Dimitri:

“The LA Times ran an investigative series last week showing how billions were mismanaged and squandered in an inept and failed attempt to upgrade the Los Angeles Community College campus. Why the perpetrators of this disaster haven’t been fired is beyond me – it unfortunately highlights the entrenched and increasingly incompetent infrastructure we are hopelessly saddled with. Yes, hopelessly – the chances of removing the incompetents is slim and none, but worse, I don’t see a cadre of competents around to take their places.”

Then there’s this, from another Golden State Reckoner, one who wishes to remain anonymous…

“There are over 600,000 California state workers getting fat pensions and health care and other retirement benefits. With benefits like [theirs] there is no hope of ever balancing the budget. We already have the highest State Income Tax, Gasoline Tax, Sales Tax and property tax. The only hope is to declare bankruptcy and let all benefits be scaled down by the legal system.”

And this, from Reckoner Peterson…

“California has a gigantic hole in this year’s budget [$24.5 billion; the largest state budget shortfall for 2012 in the entire country]. This is illegal, as the California Constitution insists the budget be balanced. Governor Schwarzenegger recalled the legislature to a special session to deal with the crisis last Fall, just before he left office.

“However, he could not get the legislature together. Many of the legislators were in Maui. As in, Hawaii. They were there to discuss green energy and who knows what else. The trip was paid for by California interest groups including the California Prison Guards union. What does the California prison guards union care about green energy, you ask? Absolutely nothing, of course. But, they care a great deal, and are willing to pay handsomely for, legislators’ votes on their pay and benefits.

“Thus, when new (old) Governor Jerry Brown took office, he was forced to propose a draconian budget that cuts all kinds of state services, including funding for education, medical care for children, and assistance to local governments. There were however no proposed cuts to the pay or benefits of the public service unions, including the California Prison Guards Union.”

Chimed Reckoner Edwardo…

“Greetings from California, the most over-governed state in the USA. A crazy place where prison guards earn 3x the rate for starting schoolteachers, and enjoy fabulous retirement benefits. The whole public sector is out-of-control, bleeding the private sector dry. Prison overcrowding has put the State under severe federal pressure.

“We have a whole government agency trying to collect sales taxes on out-of state purchases by Californians – which I would guess has a negative financial benefit to the state when all salaries, benefits, occupancy and other expenses are computed. The lunatics are running the asylum.”

And finally, we couldn’t resist printing this last email, in full. It’s a bit longer but, after having read through the entire mailbag from peeved California residents, we think it deserves a run…

“What is generally not covered in most any press is the government tyranny at the local level.

“5.3 (five point 3) YEARS ago I started the process to build a new home on a 50-acre parcel in Santa Clara County. Still no permit. The tyranny of ‘Planning’ is documented in a CATO report, showing how it created a CA real estate bubble.

“Besides being incompetent and lazy, the planners outright lie to the citizens. Not once in the 5 years did they meet the 30-day CA STATE LAW response time for filings. The top elected officials (Board of Supervisors) admit they are unable to fix the indolence, incompetency, and aggressive adversarial positions taken against the citizens.

“Since they have unchecked and unaccountable monopoly power, Planning has done what any good monopoly does when demand goes down – they have exorbitantly raised prices! Now, nearly triple the permits vs. 5 years ago are needed for – you name it!

“No matter how surly, insulting, or capricious a county employee may be, one must remember to always Kiss Their A** or they will get even. Don’t even think of escalating to a supervisor.

“At one time in the past, taxes paid for government and citizens had some control. Now, the bureaucracies do as they wish, and fee us to death, and we have no recourse.


“A. Reckoner and former CA resident

“P.S. Although I’m liquidating all CA real estate, please don’t use my name or there will be retribution by County employees.”

Tomorrow: The Daily Reckoning Dodo Derby winner. Stay tuned…

Joel Bowman

for The Daily Reckoning