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Walter E. Williams
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A Modest Proposal

Comment

California was once the land of opportunity, but it is going down the tubes. Several of California's prominent cities have declared bankruptcy, such as Vallejo, Stockton, Mammoth Lakes and San Bernardino. Others are on the precipice, and that includes Los Angeles, California's largest city. California's 2012 budget deficit is expected to top $28 billion, and its state debt is $618 billion. That's more than twice the size of New York's state debt, which itself is the second-highest in the nation.

Democrats control California's Legislature, and its governor, Jerry Brown, is a Democrat. California is home to some of America's richest people and companies. It would then appear that the liberals' solution to deficit and debt would be easy. They need only to raise taxes on California's rich to balance the budget and pay down the debt — or, as President Barack Obama would say, make the rich pay their fair share.

The downside to such a tax strategy is the fact that people are already leaving California in great numbers. According to a Manhattan Institute study, "The Great California Exodus: A Closer Look," by Thomas Gray and Robert Scardamalia (October 2012), roughly 225,000 residents leave California each year — and have done so for the past 10 years. They take their money with them. Using census and Internal Revenue Service data, Gray and Scardamalia estimate that California's out-migration results in large shares of income going to other states, mostly to Nevada ($5.67 billion), Arizona ($4.96 billion), Texas ($4.07 billion) and Oregon ($3.85 billion). That's the problem. California politicians can fleece people in 2012, but there's no guarantee that they can do the same in 2013 and later years; people can leave. Also, keep in mind that rich people didn't become rich by being stupid. They have ingenious ways to hide their money.

California has one-eighth of the nation's population but one-third of its welfare recipients.

According to Businessweek, "it is one of the few states that continue to provide welfare checks for children once their parents are no longer eligible." There's nothing new about the handout strategy. As far back as 140 B.C., Roman politicians found that the way to win votes is to give out cheap food and entertainment, what came to be known as "bread and circuses."

Given the widespread contempt for personal liberty and constitutional values, there might be a way for California politicians to solve their fiscal mess. They can simply stop wealthy people from leaving the state or, alternatively, like some Third World nations, set limits on the amount of assets a resident can take out of the state. This would surely be within their jurisdiction and would not raise any constitutional issues, because it would serve a compelling state purpose. In other words, if California were to set up border controls to stop people, as East Germans did at Checkpoint Charlie, before they cross the state line, such action would be protected by the 10th Amendment.

The fact that many Californians have managed to get their assets out of the state complicates the issue. Article 1, Section 8 of the United States Constitution authorizes Congress "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes." This is known as the commerce clause. There's no question that people who pull up stakes and leave California affect interstate commerce; California has less tax revenue, and recipient states have more. What California Attorney General Kamala D. Harris might do is sue Nevada, Arizona, Texas and Oregon in the federal courts for enticing, through lower taxes and less onerous regulations, wealthy California taxpayers.

Were California to take such measures and have a modicum of success, one wonders how many Americans would be offended by such an encroachment on personal liberty. After all, how would forcing an American to remain in a state differ in principle from forcing him to purchase health insurance?

Walter E. Williams is a professor of economics at George Mason University. To find out more about Walter E. Williams and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate Web page at www.creators.com.

COPYRIGHT 2012 CREATORS.COM



Comments

6 Comments | Post Comment
Ma'am;....What does that little trillion tell you??? Why would anyone believe that a piddley little trillion dollars is going to make a dent is an 18 trillion dollar economy???I think, whether they want to admit it or not, that those people in government recognize what Marx said: That high profits are synonymous with glut; that is, Depression...WE have had high profits, and we deal in credit for everything, which means that without credit, our money would have run into profits long ago, and been done... They have all our money... If the government cannot manufacture the courage to tax the rich, it will have to find some will to print up more money, which robs from all, most certainly from the poor it is meant to help... But I like your words: So called Stimulus Package...We wouldn't want to prevent sexually transmitted diseases for example because we might save a dollar or a hundred for every dime we invest now... Let's just invest in giving money to the rich... No one ever has enough money, but if you give it to the poor they will just spend it, and certainly not wisely, like a Madoff invester: in the stuff that dreams are made of...So what is your worry??? Is it that the stimulus will work over your dead body, or that it will not...I am betting on not, myself...But then, we will all have to get ready for a new world...For me, there is little to lose, and nothing to gain by this stimulus... But You and Your class might find that if things get bad enough for long enough that no one is going to put up with the government, or the economy that makes so many poor out of formerly productive people...Lots of people have lost everything, some losing all their hopes and dreams, stuff they have put their backs behind for years, some times, their life's capital.... Some one walked away with all they lost, and they may figure that fact out, and go looking for their lives back... My bet is that they won't  find them by looking... They might find what they've lost if they rearrange society.... Perhaps it will never happen; but do you want to make sure it happens by doing nothing, or by giving even more public money to people who don't need it, and won't spend it???The problem is, that the rich have all the money and the poor can't afford afford even the best of products at any price... Give them credit, and they can't pay it...Give them money, and it is already spent... There really is no solution to the fact that a handful have cornered all the wealth of this vast country... When one has all the goods and all the money that might buy the goods, what is the cure???It surely is not more of the disease...Thanks...Sweeney
Comment: #1
Posted by: James A, Sweeney
Fri Jan 30, 2009 11:16 AM
Excellent proposal! I suggested a similar argument a month ago. I would add two provisions; that the products
be Made in America and NO REFUNDS.
Thank You Ms. Chavez, for some clear minded thinking that would truly jump start the economy, grow business
and jobs, and really punch up the Dow.

Best Regards,

Mack Flinspach
Comment: #2
Posted by: Mack Flinspach
Fri Jan 30, 2009 8:33 PM
I found your idea very intriguing. I agree that politicians have taken the current economic downturn and forged it into an excuse to expand their power.
However, I was a bit disappointed because when I saw the title of your article I assumed you would reference Mr. Swift's plan for economic stimulus. Sadly, you did not.
Comment: #3
Posted by: bohstedt1
Fri Jan 30, 2009 10:28 PM
I think comments directed at Linda Chavez are making it to Walter Williams' page. This comment is upon Mr. Williams thought that California could set up borders and insist that wealthy citizens remain in state: "Were California to take such measures and have a modicum of success, one wonders how many Americans would be offended by such an encroachment on personal liberty."

The NLRB already told Boeing Corp. they cannot build a plant outside of Washington. How's that for "freedom of choice?" Big government's corollary is always big bully.
Comment: #4
Posted by: Tom
Mon Oct 8, 2012 11:46 AM
He had me there for a second. When I got to the paragraph about his "proposal", I thought to myself "no, this can't be. Not from Walter". I quickly realized he was being sarcastic and that this was a bogus idea. But for a second there he had me. I think the true Walter solution would be for the California state government to back off people and bussineses and become less restrictive.
Comment: #5
Posted by: Chris McCoy
Tue Oct 9, 2012 9:34 AM
When politicians are over their heads with lies and deceit, don't have a
writer/teleprompter telling them what lies to tell, don't know anything about what
America needs (nor do they care), use Taxpayers money for extensive
trips/vacations around the world and come back empty handed, there's nothing
else for them to do but “Keep on interrupting, lying, deceiving and flashing those
pearly whites!!!”

Five (5) decades, politicians receive exhorbitant salaries, insurance, retirements,
etc. They've done nothing to earn it! They've sold Americans jobs and left
Americans with nothing. Do you think Taxpayers should be paying the bills?

Instead of ‘blowing smoke' and since you're lost as to how to re-create the textile
and furniture manufacturing jobs you sold to foreign countries,it's time for
Taxpayers to start cutting senators, congress people, and justices. The best thing
that ever happened to America would be send politicians back home with no
salary, insurance, and retirements! ! They've proven they're not needed! After all,
when arriving in DC, they didn't have anything. Now they're millionaires!
Something's wrong?

Put Governor of each state in charge and let them know it's a job, not a career
position. If they don't correct the problems, balance the budget, put trillions back
into savings and start working for the Taxpayers (as politicians were supposed to
do), then ‘YOU'RE FIRED' and Taxpayers will hire someone else. Our children and
grandchildren don't stand a chance if we don't start immediately fixing five (5)
decades of problems created by incompetent, corrupt, and greedy politicians.

If politicians cared about America/Taxpayers, they wouldn't have passed NAFTA,
CAFTA, FOREIGN Trade, just to name a few. In other words, the private
companies politicians bailed out knew they wouldn't make it, but they took
Taxpayers hard-earned money anyway because politicians gave it to them
without Taxpayers consent. Taxpayers are the losers! Incentives, bailouts and
handouts must stop immediately!

Folks, it's really quite simple!

Comment: #6
Posted by: Shirley deLong
Sun Oct 14, 2012 2:37 PM
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