Monday, May 25, 2009

Paul Krugman can be really pathetic sometimes.

Paul Krugman's May 24 opinion column reads like a cartoonish parody of modern day liberals. His nominal subject is the California financial crisis, which he blams on Prop 13:
Despite the economic slump, despite irresponsible policies that have doubled the state’s debt burden since Arnold Schwarzenegger became governor, California has immense human and financial resources. It should not be in fiscal crisis; it should not be on the verge of cutting essential public services and denying health coverage to almost a million children. But it is — and you have to wonder if California’s political paralysis foreshadows the future of the nation as a whole.

The seeds of California’s current crisis were planted more than 30 years ago, when voters overwhelmingly passed Proposition 13, a ballot measure that placed the state’s budget in a straitjacket. Property tax rates were capped, and homeowners were shielded from increases in their tax assessments even as the value of their homes rose.
Krugman's argument here is transparently self-contradictory. He admits that California state spending has been irresponsible, yet he blames the California body politic for the budget crisis since it refuses to pay the bills. In other words, the appropriate public response to out-of-control, irresponsible state spending, according to Krugman, is passive acceptance. You'd have to be really stupid to actually believe this.

The reality of the situation is that it's the Democrats running California who are driving the state over the brink. Prop 13 is a political fact that limits the ability of the state to take in money, ergo, the responsible thing for the state to do is to curtail expenditures appropriately. The problem is that California Democrats (and Republican liberals) have decided to *not* curtail expenditures appropriately. Note to Krugman: this is why this spending is "irresponsible".

This is also the reason why 2009's ballot propositions 1A through 1E failed. If Californians adopt the Krugman plan and respond to out-of-control spending with tax hikes, Californians are just going to see more out-of-control spending. What California needs is a fundemantal political reform to restrain spending, not more tax hikes.

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