We Couldn't Afford it Before... How can we Now?

California's government has been generous to the poor. So generous, in fact, that being poor isn't stigmatized as much anymore unless one is also homeless, because being poor doesn't limit one's ability to still be able to live a full life. The enabling of the poor to continue to be so stifles their initiative because there is no need to be productive when the government will provide for you. That's another story, though.

California's government has also allowed for those who are poor to be able to be provided for as if they were not so. Providing preventative health care for those who can't otherwise afford it through their means alone is all well and good, if they are poor but working. Subsidizing health insurance for those who CHOOSE to obtain preventative medicine is noble, but mandating that every citizen obtain preventative medical insurance, fining those who CHOOSE not to, taxing federally those who CHOOSE to provide more for themselves and their families because they have the means to do so, and increasing the fiscal burden for the states that have chosen to do the "right thing" all along is not only wrong, it will have a very hard time standing up to Constitutional scrutiny.

This brings me to the core of this post. Today's SJ Mercury News contains an article  detailing some very good points concerning the costs to the State should the rumored contents of the current bills in Congress pass. California can barely afford to maintain its current fiscal load for health care under Medi-Cal. If the State's projected budget deficit grows past the $20B the budget offices have published for 2011-2012 California won't be able to afford the increased burden the Federal government is looking to impose on ALL of the states. One thing that isn't being very well covered by the mass majority of the media outlets is that the Federal solution (read: swatting a fly with a shotgun) is to build up funding for the intended reform by taxing first, spending later. This translates into increased taxes for individuals, businesses who provided their employees' health insurance, and the states NOW, without benefits enacted by the reform coming into effect until 2013. If California is forced to pay now for services that aren't to be rendered until after California's coffers run out there won't be services to render!

Sounds like fun, huh?

Trains, Busses and Budget Mobiles

The SF Bay Area transit authorities are having a huge problem. The poor economy has forced riders to cut back on their transit budgets. That, coupled with poor budget policy by the powers that be in Sacramento, where a huge portion of the State's various transit authorities get their revenue, has caused what amounts to an economic emergency for the Bay Area.

Ridership is down, cuts have been made to service and prices have been increased to improve the bottom lines, but revenue projections are still in the tank. This was all reported as front page Sunday Paper news in the San Jose Mercury News today. They eloquently worded the situation as the search for the Answer, with a capital "A".

The answer is to cut prices and service together. Ridership will improve when people realize their commute would be cheaper than by driving. Currently, ridership is being lost to driving because people are finding that the basic single stop fee for any transit system in the Bay Area is just too expensive. If you increase the cost of something to the point where your competition is less expensive you lose to them, which is exactly what's being described as happening in this case. What the transit authorities need to do is reduce their operating costs by reducing service, and then reduce their prices to lure customers back to their trains. Unfortunately, this is California. Because ridership is a given in the revenue predictions they use to figure their future budgets they will never understand that if you increase the cost to the customer the customer will invariably find a new way of doing things. This is doubly true when you're talking about people who have a ready alternative available. In their prediction methods reality should allow for the assumed DECREASE in ridership with any given increase in pricing. The hard nut here is that the typical transit authority executive is going to be a California Liberal (YES! THIS IS POLITICAL!), so an increase in price is exactly the same as an increase in taxes. People will find another way to do business, or leave. End of story.

I hope this won't be the end of story for the Bay Area Mass Transit System. I use it regularly because at this point it is cheaper than my commute, and also because my usage is subsidized to encourage my usage. I know you can't subsidize general ridership, but increasing their prices as an alternative is not the answer.

Tax until you can't tax n'more!

When will people get it? The AFL-CIO doesn't have a stake in the taxation of Wall Street... Or do they? There is no reason why a special interest group should even have a say in the way legislation is written, much less be allowed to make an obvious grab at that which is not theirs. If I, as a federal employee, were to go down to the nearest liquor store and "tax" (read: steal) from their register simply because during my last bender I bought copious amounts of beer from them and they should return the favor I did them in profit sharing I'd go to jail! There is no reason this should even be entertained. Goldman-Sachs makes billions of dollars. So what? Their investments drive productivity of businesses big and small. That they make a profit off of their risk in these businesses is only fair. They play their games the same way the liquor store owner plays his; the only difference is the size of the sand box. The AFL-CIO would have the government, through tax revenue, benefit from a complete lack of participation in the market constricting tax being proposed. The government has investments, too. Do you think they would be beholden to the tax man a'cometh? What about Congress Members?