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Ed Driscoll

‘Athens? I’d Like You to Meet Sacramento’

May 20th, 2012 - 9:50 pm

In a lengthy article in the New York Post, Kyle Smith compares the intertwined fiscal, demographic and anti-business woes of Greece and California. After the handshakes and initial pleasantries are out of the way, Smith reminds the Golden State and the birthplace of western democracy, “The two of you should have a lot to chat about. Such as what to do when you’re in a burning building with no exits:”

In the absence of clear authority, conditions would be ripe for a strongman to take over Greece. Strongmen tend not to be very nice. A majority of police officers, according to a survey published in the Athens paper The Tribune, voted this month for the neo-Nazi group Golden Dawn.

Lee Harris, writing for the American Enterprise Institute, brings up a crucial point about Greece: In the US, “No one seriously argues that the period of austerity (i.e., recession) was the deliberate policy of this or that administration. But the European austerity programs are the deliberate policy of the governments that have imposed them, and this is a fact that every citizen forced to tighten his belt is perfectly aware of.”

Greeks aren’t going to be waiting patiently in breadlines singing “Brother, Can You Spare a Drachma.” We’re talking about serious rage. Greece may be the cradle of democracy, but its current democracy is only 37 years old. Before that: military rule.

These sound like just the kind of conditions you probably don’t want if your best hope of climbing out of recession is to attract tourists.

Nationalism, which the EU was supposed to cure forever as all member nations joined hands and sang hosannas to Delors, is rising again like heartburn: A left-wing Greek member of parliament declared, “Achtung Frau Merkel. The Greek people want to live free and they don’t want to be under a new occupation from Germany.” A left-wing extremist group torched a car belonging to a German who leads an EU task force on Greece. In relatively unscathed France, extremist parties captured 30% of the vote in this spring’s presidential elections.

ATHENS? I’d like you to meet Sacramento. The two of you should have a lot to chat about. Such as what to do when you’re in a burning building with no exits.

In California, efforts to close the budget deficit by taxing the rich resulted in the deficit shrinking from $9 billion all the way to $16 billion. Gov. Jerry Brown’s proposed solution: Tax the rich even more (and tax everybody else, too, by hiking sales tax).

California contains about one-third of the nation’s welfare recipients (despite having 12% of the nation’s population) and is planning a high-speed rail system that will cost an estimated $68 billion, including $4 billion on a section The Los Angeles Times dubbed a “train to nowhere.” Its pension costs for public employees, 85% of them unionized, rose 2,000% in the first decade of this century, which is 1,976% more than revenues increased. A CEO survey in April ruled that California was the least business-friendly state in the US.

In 1999, when the state was flooded with dotcom tax revenue, it set in place a law, SB 400, that assumed the good times would continue forever and allowed government workers as young as 50 to retire on 90% of salary they earned in their final year, when they would ramp up the overtime. In order to cover these commitments through the CALPERS investment fund, the Dow Jones Industrial Average would have to be over 25,000 by now.

Pension and health-care spending for retirees are set to triple this decade. More than 12,000 state and local workers are collecting more than $100,000 a year in pensions. Even convicted felons can collect pensions.

Greek and Californian politicians made the same mistake: They wanted union backing so badly that they promised far more than they could ever deliver. They knew that they’d be long gone before the crisis kicked in, or maybe it would solve itself. Either way, they didn’t care. They were happy to use tomorrow’s seed corn to buy themselves power. California’s pension plans face a $500 billion hole in unfunded promises.

And speaking of California’s unions, at City Journal, Troy Senik invites us to observe (fortunately, at a distance far enough back so as to not to worry about the fists and brickbats), “The Worst Union in America — How the California Teachers Association betrayed the schools and crippled the state.” Senik describes the California Teachers Association as “the single most powerful special interest in California,” whose end product brings to mind Woody Allen’s classic Catskills-era riff at the beginning of Annie Hall – ”Boy, the food at this place is really terrible.” “Yes I know — and such small portions.”

Related: Thomas Sowell predicts a Greece/California-style destiny for the rest of America:

Now that census data show — for the first time in American history — that the number of white babies born is exceeded by the number of babies born to non-white minorities, the question is: What does this mean for the future of American society?

Politically, it means that minorities who traditionally vote overwhelmingly for Democrats can ensure that the country veers ever further to the left over the years, making America more like the welfare states of Europe, whose unsustainable spending led ultimately to financial crises and widespread riots.

But this is not strictly a matter of whites versus non-whites. Jews vote consistently, and almost as overwhelmingly, for Democrats as blacks do. Moreover, Asian Americans are by no means as likely as other non-whites to vote for the class-warfare, tax-and-spend agenda of the Democrats.

Yet when all is said and done, the future political direction of the country seems painfully clear from these demographic trends, unless something happens to change the current correlation between race and political-party affiliation. Moreover, even that may not be enough.

Well, that’s something to look forward to.

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