California Faces $25 Billion Budget Deficit Requiring Deep Cuts to Higher Education and Services for the Poor, Disabled and Elderly (but No Cuts to Public Workers' Salaries, Benefits and Pensions)
California Treasurer Warns of IOUs, If No Cuts
The Associated PressJanuary 22, 2011
State Treasurer Bill Lockyer said Saturday that California could be forced to issue IOUs as early as April or May if state lawmakers don't make deep spending cuts soon.
Lockyer, a Democrat, said that if lawmakers don't adopt a timely budget "that addresses the substantial shortfall in current accounts, we will run out of money to pay the bills either in this fiscal year or shortly into the new one."
The treasurer made the comments at a political conference hosted by the University of California, Berkeley Institute for Governmental Studies.
California faces a $25.4 billion deficit through the end of June 2012, including an $8.2 billion shortfall in the fiscal year that ends in July.
To close the gap, Gov. Jerry Brown, a fellow Democrat, has proposed $12.5 billion in spending cuts and borrowing, and wants to ask voters to extend a series of temporary taxes in a June special election. The state Legislature would need to act by the end of March to get such a measure on the ballot, and Brown has also asked lawmakers to have a budget deal in place by then.
"The governor has said he wants to get a budget back from the Legislature by March. Lockyer's comments today really underscore how important that is," said Brown spokeswoman Elizabeth Ashford.The treasurer said that to win voter approval for extensions of temporary sales, income and vehicle taxes, Brown and other Democrats must show California voters what's at stake -- what would be cut if the proposed $11 billion in tax increases aren't approved.
Republican legislative leaders have vowed to fight efforts to extend the taxes and have so far been steadfastly against even putting such a measure before voters. Brown likely needs two-thirds support in both houses of the state Legislature to get his measures on the ballot, meaning two GOP votes in the Assembly and three in the Senate.
Lockyer said many Democrats are worried about appearing to threaten voters by presenting a "cuts only" budget, but said voters need to know what it would mean to the state.
"The hit on K-12 (schools) is at least close the schools six weeks a year. Voters need to hear that," he said.Earlier this month, Brown proposed a $127.4 billion spending plan for the 2011-12 fiscal year. It includes deep cuts to higher education and services for the poor, disabled and elderly.
Part of Brown's sales pitch this time is that most of the tax revenue from the sales tax and vehicle license fee extensions, if approved at the polls, would go to cities and counties. California voters have shown greater willingness to pay for local services than to fund state government, which many see as inefficient.
The 'End of America' is Beginning in California
S&A DigestOctober 6, 2011
One of the more controversial aspects of Porter's "End of America" thesis is his prediction that – as the financial crisis deepens – many government services people have come to rely on will stop. The government simply won't collect enough tax revenue to pay the pensions, benefits, and salaries of government employees. States and municipalities will declare bankruptcy. Huge cutbacks will take place. Riots and protests (like those going on in New York City and Greece right now) will become commonplace.
This is a problem that runs through the system at all levels: local, state, and federal. It's going to cripple the government's ability to pick up garbage, police communities, and fight fires.
We're in this situation because public employees – and a good portion of the public they serve – have discovered that they can vote themselves the Treasury. Rather than viewing the government as an entity that should set and enforce rules and protect the public in times of war, many people see it as a gravy train.
As Michael Lewis writes in his latest article for Vanity Fair, the gravy train is crashing in California. Lewis, who in our opinion is the best financial journalist in the world, recently traveled to California to investigate the state's financial crisis.
He notes that in the city of Vallejo (which is next to San Francisco), you can park anywhere you like. There aren't any meter maids around to write tickets. Police and fire departments have been cut in half. The city declared bankruptcy in 2008. The pay and benefits of "public safety" workers consumes 80% of its budget. The city's finances have been crushed because too many promises were made for too many years.
This story is playing out in many California cities… and others across America. It's playing out in the private sector as well. Lewis notes his thoughts while talking to Vallejo city manager, Phil Batchelor…
The story of Vallejo, the section on Schwarzenegger, and the story of a fat pheasant named Henry all make for a great article. It's long... So you might want to print it off and save it for weekend reading. Right now, the article is free on Vanity Fair's website. You can read it here.
California tends to lead the way for other US states, which in the past was mostly good. But now the Golden State is about to become a Third World country, complete with deteriorating public services and a permanent, volatile underclass. Those “London burning” pictures will be replicated in LA before too long.
The sad truth is that it’s simply impossible to run a major US state with the current public sector pay/benefits structure. The process of scaling back pensions and salaries will hurt a lot of cops, teachers and social workers who don’t deserve pain. But there’s no mathematical alternative to a dramatic lowering of state/local operating costs.
This is the inevitable result of three decades of lies told to public sector unions and taxpayers. The people making the promises (lifetime pension/health care for 50-year-old retirees, for instance) either knew they were lying or were really, really stupid. Either way, they’re the villains in this story.
The muni bond market has held up amazingly well considering that many of them are loans to bankrupt states in a soon-to-be bankrupt country. But in the coming yearMeredith Whitney’s prediction of “hundreds of billions of dollars of muni defaults” might come true, again with California leading the way.
London is burning. Greece is in receivership. Nobody wants Italian bonds. France’s AAA rating is at risk. The headlines do seem to be a bit Euro-centric lately. But that’s temporary. Before long the spotlight will swing back to America’s failed states, beginning, as always, with California. Consider:
July 29, 2010
An important thing to remember during this financial crisis is that it’s not just the federal government that has mismanaged the public’s money by taking on too much debt and entitlement promises like social security and medicare which it simply cannot service. Like the central planners in Washington D.C., many of our states are also in trouble, namely because of social service programs like state health care and state pension funds.
Over the last several years many state pension funds have experienced massive declines; and because we’re nowhere near the finish line, we can expect even more destruction as stock invested pensions get decimated in coming months and years. This means that the states will be incapable of making payments not only to pensioners, but they’ll be forced to either make massive cuts in essential services like emergency response and government administration, or borrow money from the federal government -- probably both.
Here’s how the states fared in a recent study:
It’s only going to get worse. No bureaucrat in Washington or your state capital is prepared to do what’s necessary, so they will continue to kick the can down the road until the road dead ends.
How long will this be?
It’s hard to say, but in terms of the states, we’re likely looking at sooner rather than later. States are already broke, with California, Illinois and New Jersey already showing serious fiscal strain. In the near future we’ll begin seeing states requesting bailouts directly from the federal government. Eventually, we suspect that the majority of states will be standing in the welfare line looking for hand outs.
For now, the US dollar remains fairly strong given our economic problems. In fact, any time a financial emergency spreads across the globe, investors seem to be running to US bonds for safety, so there is still confidence in the US government’s ability to service our existing debt.
However, we believe that once the states begin to require federal involvement to pay government workers, emergency responders and pensioners, we will be much closer to a serious collapse of not only our economic system, but the monetary system as well. It’s only a matter of time before the rest of the world realizes that we’re completely broke and takes action accordingly.
The states blew a government spending bubble, and that bubble is about to pop. The federal debt bubble will not be far behind.
August 2, 2010
Local business leaders are increasingly alarmed about skyrocketing public-sector pension costs.
They fear that in order to meet pension obligations, state and local governments will go after companies’ pocketbooks, slash government contracts for business, and cut back on services that businesses need or that keep the state and city safe.
With future state pension obligations estimated at $550 billion – more than six times California’s general fund budget – and pension obligations of local governments statewide totaling at least that much, business leaders are calling on governments to reform their pension systems and rein in costs.
Business groups are backing Gov. Arnold Schwarzenegger’s plan to reform the state’s pension systems. In addition, they are prodding officials in Los Angeles and other cities to reform their pension plans, even threatening ballot initiatives should these officials fail to act.
But Toebben said the stakes are high for business.
Business leaders also cite recent losses in pension fund investment portfolios as cause for alarm. In 2008-09, for example, the state’s largest pension fund, the California Public Employees’ Retirement System, or Calpers, lost 23.4 percent of its value. (Some of that was made up in the 2009-10 fiscal year, when a market rally resulted in an investment portfolio gain of 11.4 percent.)
One of the most outspoken local business leaders on the issue is David Fleming, founding chairman of the Los Angeles County Business Federation and of counsel with the downtown L.A. law firm Latham & Watkins LLP. He blames the public employee unions for creating an unsustainable pension system and then pushing for taxes on businesses to help pay for it.
That $1.21 billion figure is one-fourth of general fund revenues and more than 40 percent of payroll.
This rise in pension obligations is a major factor in the projected 2013-14 budget deficit of $515 million.
Part of the problem results from pension recipients getting more money. The average annual pension for a retired L.A. civilian worker in 2009 was $40,000, up 54 percent from 2004. The average pension for a retired police officer or firefighter was $53,000 in 2009, up 29 percent from 2004. The figures come from separate pension analyses by the Los Angeles Daily News and Los Angeles Times.
Also, in 2009 there were more than 600 L.A. retirees receiving pensions of more than $100,000, a stunning increase from 164 five years prior.
Toebben said that if the city does not take steps to rein in pensions, the private sector will push for a ballot initiative in 2011 or 2012.
In Long Beach, the business community is already supporting a proposed ballot measure designed to control pension costs. The local City Council is scheduled at this week’s meeting to consider proposals for the measure.
A central cause of the state’s pension debacle was a 1999 law signed by Gov. Gray Davis that liberalized retirement benefits for state workers, and served as a model for many cities, counties and school districts.
The law boosted pension benefits in several ways. It increased dollar amounts by changing formulas, and benchmarked benefits against the last year of employment instead of the last three years. The latter allowed “spiking” – workers loading up overtime and raises in their last year in order to maximize pensions. It also lowered retirement eligibility from 55 to 50 for police and firefighters.
Controlling costs
Business leaders said that they don’t intend to gut public employee pensions. Rather, they want to see future obligations brought under control by reducing pension payouts for new hires and increasing public employee cash contributions to their retirement plans, among other things.
Ten years ago, the city, along with many local governments, didn’t make any pension contributions to Calpers, due to the fund’s huge portfolio gains in the late 1990s. By 2005, though, Long Beach had to pay $48 million into Calpers. Since then, its contribution has increased an average of 9 percent per year, reaching a projected $71 million for the current 2010-11 fiscal year.
But, according to the city’s estimates, the huge loss at Calpers in 2008-09 means Long Beach will have to pay $95 million to Calpers by 2013, about 17 percent of its general fund. In part to offset these payouts, the city has made budget cuts totaling $163 million over the last six years and faces an additional $19 million budget deficit for the 2011 fiscal year beginning Oct. 1.
Exaggerated claims?
Public employee unions and pension officials said business leaders and their Republican Party allies are exaggerating the pension problem.
They claim that local and state pension systems, while they could use some tweaks, are essentially sound and they promise to fight what they term as attempts to gut public employee pensions.
39-year old John Pike (shown in photo) is a former U.S. Marine sergeant who has been honored for his police work on campus, but an alleged anti-gay slur by Pike also figured in a racial and sexual discrimination lawsuit a former police officer filed against the department, which ended in a $240,000 settlement in 2008. Pike was hired onto the University of California, Davis police force in 2001.
His salary at UC Davis:
2010 Pay - $110,243
2009 Pay - $107,792
2008 Pay - $105,000
By now many will have seen the footage of students from University of California, Davis being pepper sprayed by the campus policeman. It seems to be everywhere.
It’s understandable, there is something brazen in the casual disdain with which he dowses the line of seated students. There was also the momentary raised arm to the crowd, like a gymnast about to commence their floor routine, it seemed a performative gesture to either his colleagues, the crowd or the perhaps inevitable global audience.
This student protest at the UC Davis campus was a protest in response to the hypocrisy I speak of and I can understand their resolute outrage. This protest was organised in response to a call for solidarity following the police violence on the UC Berkeley campus a week earlier. UC Berkeley Chancellor Robert J. Birgeneau (whose salary was $416,596 in 2010) ordered police to break up a peaceful rally against increases in tuition fees. Unsurprisingly in the course of breaking up the protest police used batons against students resulting in injuries that included broken ribs.
UC Berkeley is a campus that has a long tradition of student activism dating back to the 1960s. A key moment was in 1969 when, akin to the contemporary occupy movement, students created a community park on campus to campaign for free speech on campus. Then California Governor Ronald Reagan ordered the National Guard onto the campus resulting in widespread injuries and the death of a student.
The actions ordered on both of the UC campuses fit very well within what is becoming a continued pattern of extremely disingenuous disavowals of the willingness to use violence against non-violent protesters in the name of health safety. The argument that violent policeman are ‘bad apples’ doesn’t hold water. Take the UC Davis footage. Yes, it was one officer that used pepper spray against the students but police forces are designed around a strict system of hierarchy and accountability. Senior officers are accountable for the actions of those they are in charge of and other officers have a duty to ensure fellow officers uphold the law. Recall the performative gesture; his intent was clear and no officer stepped forward to prevent students being pepper sprayed or assist injured students.
The responsibility for these actions can’t be disavowed. A junior faculty member has put this in the strongest possible terms in an open letter to the UC Davis Chancellor, Linda Katehi, calling for her resignation.
Through all this though, the deepest hypocrisy lies in the fact that political UC Berkeley as an institution claims to pride itself on this tradition of campus activism. Its website even has a page dedicated to this tradition. Of all the things that should not become hollowed out into a cynical public relations exercise, it is the idealism of young students.
November 22, 2011
The Internet hacking group Anonymous has launched its latest attack on the UC Davis police officer accused of pepper-spraying student by posting a video online that lists his personal contact information.
A call to the listed cellphone number was answered by a voicemail announcement naming Pike as its owner, but said no space was available to leave a message.
PHOTOS: Protests at UC Davis
A shorter two-minute video was also posted by the hacking group that tells officials,
The far-flung group launched its attack on Pike just days after the students were sprayed Friday. Since the incident, two unidentified UC Davis police officers and the police chief have been placed on administrative leave.
November 23, 2011
The University of California, Davis, chancellor defended herself Tuesday from criticism over the campus police force's pepper spraying of peaceful demonstrators as information emerged about the officer at the heart of the incident.
Video footage of Lt. John Pike and another officer clad in riot gear casually spraying an orange cloud at the heads of protesters who were sitting peacefully on the ground has sparked national outrage since it began circulating online Friday night. Students gathered on campus Tuesday for the second time in as many days to condemn the violence and urged university officials to require police to attend sensitivity training.
UC Davis Chancellor Linda Katehi, who has faced criticism from students over Friday's incident, defended herself during a town hall meeting Tuesday night. She told an auditorium filled with a little more than 1,000 students that she asked police to remove tents from the university's quad but did not direct them to forcibly remove the demonstrators.
Not all students who attended the town hall in a performing arts complex were satisfied with the response from Katehi, who attended a rally on campus Monday and apologized to students. Puneet Kamal, 22, an environmental science and policy major, was among those lined up to ask questions Tuesday.
He has risen swiftly through the ranks of the UC Davis police force over the last decade. As one of four lieutenants, the 39-year-old supervises more than one-third of the sworn officers, including the investigations unit.
He has twice been honored by the university for exceptional police work, including a 2006 incident in which he tackled a scissor-wielding hospital patient who was threatening fellow officers. Afterward, he said he decided against using pepper spray because it might harm his colleagues or other hospital patients.
But an alleged anti-gay slur by Pike also figured in a racial and sexual discrimination lawsuit a former police officer filed against the department, which ended in a $240,000 settlement in 2008. Officer Calvin Chang's 2003 discrimination complaint against the university's police chief and the UC Board of Regents alleged he was systematically marginalized as the result of anti-gay and racist attitudes on the force, and he specifically claimed Pike described him using a profane anti-gay epithet.
As the controversy over the spraying incident has grown, images of the lieutenant have become the subject of a popular blog, which features his image superimposed on famous paintings and spraying famous figures, from Gandhi to John F. Kennedy. The handcraft site Etsy.com also is selling a T-shirt emblazoned with Pike's image but showing flowers coming out of his spray can.
Dieter Dammeier, an Upland lawyer for the Federated University Police Officers Association, the union that represents UC Davis officers, said the operations plan issued by the department includes the use of pepper spray. Dammeier said he does not represent Pike because he is a manager.
Given the sometimes violent events associated with Occupy demonstrations in downtown Oakland and UC Berkeley, UC Davis administrators did not want tents and encampments to take hold on campus because it would likely draw people who were not students, said John Meyer, vice chancellor for administrative and resource management.
In 2003, two years after Pike joined the campus police force, he received his first meritorious service award for using his patrol car to bump a suspect's vehicle onto a local highway ramp, stopping the man from driving the wrong way.
Four years later, the university's press office issued a release about accolades Pike received after subduing a UC Davis Medical Center patient who was threatening a fellow officer with scissors and a spray bottle filled a caustic chemical. Pike saw the scissors-wielding patient try to assault an officer and landed "a body block, powering his left shoulder" into her, the release said.
But in that situation, the 245-pound Pike opted not to use pepper spray, because he didn't want to hurt his fellow officers, Pike said.
He also appointed the university's general counsel and the UC Berkeley law school dean to examine police protocols and policies at all 10 UC campuses, including discussions with students, faculty and staff.
Katehi has already asked the Yolo County district attorney's office to investigate, and Chief Deputy District Attorney Jonathan Raven confirmed Tuesday that the department will look into the matter.
Attorney General Kamala Harris was deeply disturbed by the videos of the incident, spokeswoman Lynda Gledhill said Tuesday.
This is why California is broke and why tuition for the state's higher education system is so high (taxpayers are on the hook for lifetime pensions, healthcare and survivor benefits as well):
November 20, 2009
Authorities arrested dozens of angry students at the University of California, Davis, campus late Thursday after they refused to vacate the school's administration building in protest of a 32-percent tuition hike.
The 52 students were taken into custody by the Davis Police Department and deputies from the Yolo County Sheriff's Department, according to Claudia Morain, a UC Davis spokeswoman.
The arrests at the Mrak Administration building came about four hours after the normal 5 p.m. PT (8 p.m. ET) closing time. At one point, as many as 150 students were at the building protesting the tuition increase, Morain said.
CNN affiliate KCRA captured footage of students outside the building shouting,
Nearly 400 miles south and hours earlier, hundreds of students marched and chanted against the increase while outside the UCLA building in Los Angeles where regents met to vote on the hike.
Protesting students and others say the increased tuition will hurt working and middle-class students who benefit from state-funded education. But officials argue that a fee increase and deep cuts in school spending are necessary because of a persistent budget crisis that has forced reductions across California's state government.
As one regent member walked out, students surrounded his path shouted,
The University of California's Board of Regents approved the plan a day after the regents' finance committee also approved the 32-percent hike in undergraduate tuition fees...
On Wednesday, hundreds of students, faculty and campus workers protested outside the finance committee meeting on the UCLA campus. Fourteen people were arrested Wednesday morning after they disrupted the regents' meeting with chanting, police said. Other protests, including "tent cities," were under way on other University of California campuses across the state.
University executives told the regents the fee hikes were needed since they've already made deep spending cuts in the past two years -- cuts forced by the state budget. About 26 percent of the $20 billion spent each year by the system comes from the state's general fund and tuition and fees paid by students, according to a summary on the regent's Web site.
The first tuition hike, which takes effect in January, will cost undergraduate students an additional $585 a semester. The second hike kicks in next fall, raising tuition another $1,344, she said.
The fee increases would be balanced by a raise in "the level of financial assistance for needy low- and middle-income students," according to a statement from the Board of Regents. The tuition hike is expected to raise $505 million for the university system, and about $175 million of that money would go toward financial aid for low-income students, the board said.
November 18, 2010
University of California committee has approved a plan to raise student fees by 8 percent next fall while expanding financial aid to more students.
The increase will raise an estimated $180 million in annual revenue, with about one-third set aside for financial aid.
November 20, 2009
Authorities arrested dozens of angry students at the University of California, Davis, campus late Thursday after they refused to vacate the school's administration building in protest of a 32-percent tuition hike.
The 52 students were taken into custody by the Davis Police Department and deputies from the Yolo County Sheriff's Department, according to Claudia Morain, a UC Davis spokeswoman.
The arrests at the Mrak Administration building came about four hours after the normal 5 p.m. PT (8 p.m. ET) closing time. At one point, as many as 150 students were at the building protesting the tuition increase, Morain said.
CNN affiliate KCRA captured footage of students outside the building shouting,
Nearly 400 miles south and hours earlier, hundreds of students marched and chanted against the increase while outside the UCLA building in Los Angeles where regents met to vote on the hike.
Protesting students and others say the increased tuition will hurt working and middle-class students who benefit from state-funded education. But officials argue that a fee increase and deep cuts in school spending are necessary because of a persistent budget crisis that has forced reductions across California's state government.
As one regent member walked out, students surrounded his path shouted,
The University of California's Board of Regents approved the plan a day after the regents' finance committee also approved the 32-percent hike in undergraduate tuition fees...
On Wednesday, hundreds of students, faculty and campus workers protested outside the finance committee meeting on the UCLA campus. Fourteen people were arrested Wednesday morning after they disrupted the regents' meeting with chanting, police said. Other protests, including "tent cities," were under way on other University of California campuses across the state.
University executives told the regents the fee hikes were needed since they've already made deep spending cuts in the past two years -- cuts forced by the state budget. About 26 percent of the $20 billion spent each year by the system comes from the state's general fund and tuition and fees paid by students, according to a summary on the regent's Web site.
The first tuition hike, which takes effect in January, will cost undergraduate students an additional $585 a semester. The second hike kicks in next fall, raising tuition another $1,344, she said.
The fee increases would be balanced by a raise in "the level of financial assistance for needy low- and middle-income students," according to a statement from the Board of Regents. The tuition hike is expected to raise $505 million for the university system, and about $175 million of that money would go toward financial aid for low-income students, the board said.
Who Are the London Rioters?
The Superdome in New Orleans after Katrina was meant to be a hurricane refuge, but those who sought shelter there described it as a lawless "concentration camp." "People were locked in the dome like prisoners," said a 13-year veteran of the New Orleans police force who asked not to be identified. Much of the frustration voiced by the evacuees concerned the lack of information. People were prevented from leaving the arena and were desperate for news of what had happened to their friends, neighbors, family members and homes. Many blamed the officials for failing to give them any updates on the situation. "We were treated like this was a concentration camp," said Audrey Jordan of the Superdome. "One man couldn't take it. He jumped over the railing and died." - Stadium Hurricane Refuge Like a 'Concentration Camp', Agence France Presse, September 2, 2005
The Superdome During Katrina
A disaster medical assistance team, DMAT, from San Francisco area, CA-6, served in the Superdome during the Katrina Hurricane. Conditions were horrific.
Greta Van Susteren of Fox interviewed Dr. Charles Burnell, an emergency room physician who was providing medical care in the Superdome. Asked about the level of violence among the 20,000 displaced residents who sought shelter inside the giant stadium, Dr. Burnell said: "We had three murders last night. We had a total of six rapes last night. We had the day before, I think, there were three or four murders. There were half-a-dozen rapes that night. We had one suicide last night. We had one military policeman shot." Dr. Burnell described the Superdome situation as "very unstable, very high tension, a very dangerous environment." While National Guardsmen were on hand for protection, he said that "every time there was an incident that broke out, they had to tend to that, which left us uncovered." Burnell said the task of treating people inside the stadium became impossible after they ran out of supplies. "We did not have oxygen, we did not have any medications to speak of," he said. But what forced the New Orleans doc to finally abandon the giant evacuation center was the threat of violence. "Until I can insure that I'm not putting my life in any significantly dangerous situation as I was before - I will not be back in the Superdome," he told Fox. - Doc: 6 Murders, 12 Rapes Inside Superdome, Newsmax.com, September 1, 2005
We're in this situation because public employees – and a good portion of the public they serve – have discovered that they can vote themselves the Treasury. Rather than viewing the government as an entity that should set and enforce rules and protect the public in times of war, many people see it as a gravy train.
As Michael Lewis writes in his latest article for Vanity Fair, the gravy train is crashing in California. Lewis, who in our opinion is the best financial journalist in the world, recently traveled to California to investigate the state's financial crisis.
He notes that in the city of Vallejo (which is next to San Francisco), you can park anywhere you like. There aren't any meter maids around to write tickets. Police and fire departments have been cut in half. The city declared bankruptcy in 2008. The pay and benefits of "public safety" workers consumes 80% of its budget. The city's finances have been crushed because too many promises were made for too many years.
This story is playing out in many California cities… and others across America. It's playing out in the private sector as well. Lewis notes his thoughts while talking to Vallejo city manager, Phil Batchelor…
... as he talked about the bankrupting of Vallejo, I realized that I had heard this story before, or a private-sector version of it. The people who had power in the society, and were charged with saving it from itself, had instead bled the society to death. The problem with police officers and firefighters isn't a public-sector problem; it isn't a problem with government; it's a problem with the entire society. It's what happened on Wall Street in the run-up to the subprime crisis. It's a problem of people taking what they can, just because they can, without regard to the larger social consequences.Lewis' article also contains an interesting section on former California Governor Arnold Schwarzenegger, who he interviewed for the piece. It details the suffocating bureaucracy and incredible power of special interest groups that control California... and prevent any meaningful change from taking place.
It's not just a coincidence that the debts of cities and states spun out of control at the same time as the debts of individual Americans. Alone in a dark room with a pile of money, Americans knew exactly what they wanted to do, from the top of the society to the bottom. They'd been conditioned to grab as much as they could, without thinking about the long-term consequences. Afterward, the people on Wall Street would privately bemoan the low morals of the American people who walked away from their subprime loans, and the American people would express outrage at the Wall Street people who paid themselves a fortune to design the bad loans.
The story of Vallejo, the section on Schwarzenegger, and the story of a fat pheasant named Henry all make for a great article. It's long... So you might want to print it off and save it for weekend reading. Right now, the article is free on Vanity Fair's website. You can read it here.
Don’t Forget America’s Failed States; California Tends to Lead the Way
After spending a recent week in Los Angeles, I now understand the concepts of Peak Oil and road rage: Tens of thousands of cars, most containing only one person, going 75 miles an hour for a really long time to get anywhere. Besides being stressful, this system is fragile. It will grind to a halt on the day gas hits $6 a gallon.California tends to lead the way for other US states, which in the past was mostly good. But now the Golden State is about to become a Third World country, complete with deteriorating public services and a permanent, volatile underclass. Those “London burning” pictures will be replicated in LA before too long.
The sad truth is that it’s simply impossible to run a major US state with the current public sector pay/benefits structure. The process of scaling back pensions and salaries will hurt a lot of cops, teachers and social workers who don’t deserve pain. But there’s no mathematical alternative to a dramatic lowering of state/local operating costs.
This is the inevitable result of three decades of lies told to public sector unions and taxpayers. The people making the promises (lifetime pension/health care for 50-year-old retirees, for instance) either knew they were lying or were really, really stupid. Either way, they’re the villains in this story.
The muni bond market has held up amazingly well considering that many of them are loans to bankrupt states in a soon-to-be bankrupt country. But in the coming yearMeredith Whitney’s prediction of “hundreds of billions of dollars of muni defaults” might come true, again with California leading the way.
London is burning. Greece is in receivership. Nobody wants Italian bonds. France’s AAA rating is at risk. The headlines do seem to be a bit Euro-centric lately. But that’s temporary. Before long the spotlight will swing back to America’s failed states, beginning, as always, with California. Consider:
Signs point to California facing new budget gap
(Reuters) – California’s summer vacation from its state budget woes didn’t last long.
California’s latest monthly revenue report shows revenue weaker than expected even before the stock market, a key source of revenue for the state, began sliding in response to Standard & Poor’s downgrade of U.S. debt, anxiety about Europe’s finances and the risk of the U.S. economy slipping back into recession.
For officials in California’s capital, underwhelming July revenue and Wall Street’s hard times suggest they will have to draw up plans for cutting more spending early next year.
Beyond Sacramento, if revenue swoons in coming months, it will assure renewed headlines of how the government of the most populous U.S. state is facing yet another budget shortfall.
Californians, and the state’s bond investors, should brace themselves for that in light of how a choppy stock market can hurt the state’s revenue, said Neil Hokanson of Hokanson Associates, a family wealth manager in Solana Beach, California.
California is like a household where one spouse is a sales person, Hokanson said, noting: “It has good years and it has bad years.”
This year was supposed to be a not-so-bad year for California, with revenue improving after a few years of declines sparked by the housing crash, recession and plunge in stock prices following the Lehman Brothers bankruptcy.
Governor Jerry Brown and state lawmakers closed a roughly $10 billion deficit in June with a plan that balanced California’s books with spending cuts, deferred payments, some fees and, most important, the assumption that an additional $4 billion in revenue would flow into state coffers.
The money would be generated by the state’s gradual economic recovery and wealthy taxpayers who pay the bulk of personal income taxes, the state’s most important revenue source, as their capital gains increase with the stock market extending its climb from its March 2009 low.
That plan may soon need to be revised.
Even before volatility struck the stock market this month, California’s revenue was not meeting expectations: July revenue was $538.8 million, or 10.3 percent below its projected level in the state’s recently enacted budget, the state controller said on Tuesday.
New California wildfire fee may drain agency’s firefighting budget
(Mercury News) – A California law that imposes an annual wildfire fee on rural residents may have an unintended consequence — sapping the state fire agency of money it needs to fight wildland blazes, officials said Wednesday.
Concerns about the $150-a-year fee, which is contained in the state budget Gov. Jerry Brown signed earlier this summer, were raised Wednesday by the California Board of Forestry and Fire Protection.
Democrats in the Legislature passed the fee and said it eventually would raise $200 million a year. That would allow the state to transfer an equal amount of money from the California Department of Forestry and Fire Protection to the general fund budget.
Under the law, proceeds from the fee must go to local fire-prevention efforts through local fire districts, fire councils or the California Conservation Corps — not the state fire department.
George Gentry, chief operating officer of the Board of Forestry, told The Associated Press that will leave the department with a hole in its firefighting budget this year.
Court halts dismantling of CA redevelopment agencies
(San Francisco Chronicle) – The state Supreme Court put the brakes Thursday on a plan to dismantle redevelopment agencies in California, posing yet another challenge to California’s ability to keep its budget balanced.
The court said it would decide by mid-January whether the state’s plan to eliminate the economic development program is legal, and allowed redevelopment agencies to continue to exist while the case is pending. But it also barred the agencies from starting any new projects, issuing bonds or purchasing or transferring any property until the suit is resolved.
If the case is successful, it will punch a $1.7 billion hole in the state’s budget for the current fiscal year and cause a $400 million annual shortfall in future years.Stock market turmoil a bad omen for California budget
(Reuters) – The stock market’s recent slump is reviving bad memories for California’s government and raising concerns about revenue estimates for its budget, a perennial concern in the U.S. municipal debt market.
The concern in the state capital of Sacramento is the slump hints at the potential for a stock market meltdown like the one in 2008. That sent California’s finances into disarray.
Heavy market losses could force California to trigger spending cuts to politically popular programs and revive calls for tax increases, both sure to spark rows in the legislature that cause many investors to stay clear of the state’s debt.
Governor Jerry Brown and lawmakers in June notched a budget plan that closed a multi-billion dollar deficit and balanced the state’s books in part with a rosy revenue outlook.
Critics said the forecast was too optimistic given the state’s weak economy and the potential for reversals in financial markets. When they swoon, California’s revenue shrinks because it relies heavily on wealthy taxpayers and their capital gains to provide a large chunk of the personal income tax receipts.And finally this from Douglas French of the Mises Institute:
Los Angeles, America’s Harbinger
In a piece for the Wall Street Journal, Joel Kotkin tells of the demise of Los Angeles. No, you won’t see Snake Plissken or Rick Deckard racing through the City of Angels just yet. But the city’s political machine is doing all it can “to leave behind a dense, government-dominated, bankrupt, dysfunctional, Athens by the Pacific,” explains Kotkin.
…The unemployment rate for Los Angeles County was officially 12.4 percent in June, after peaking a year ago at 13.4 percent. However, the worst is likely not over. As Kotkin explains, the Panama Canal is planning to widen and there are plenty of ports on the eastern seaboard looking for business. Also, the Golden State’s renewable-energy mandates are estimated to increase energy costs by 20–25 percent.
Californians already pay 53 percent more than the national average.
And the taxman is especially brutal in California, with a top rate of 10.3 percent, which kicks in at a $1 million in earnings. Sure, not many are pulling down that much, but the second highest rate, 9.3 percent, applies to those making $46,766 and above. The state’s minimum wage is $8 an hour, 75 cents above the federal rate. And restaurant employers may not use tips earned as credit toward this obligation as is the case in many states. California employers are required to pay “exempt” employees double the state minimum, putting these employees in the 6 percent tax bracket.
What once was believed to be a city of destiny (paradise on earth) is being destroyed by government looting; and now its saviors, the state of California and the federal government, have been looted as well.
The Cause of California's State’s Pension Debacle was a 1999 Law Which Boosted Pension Benefits and Served as a Model for Many Cities, Counties and School Districts
A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, which is always followed by a dictatorship. [Justice Litle, Is America’s Economic Recovery on the Whole Based on a Rotten Sham?, Daily Markets, April 20, 2010]Collapse of Dysfunctional States Is Another Step to the Federal Bubble Detonation
SHTFPlan.comJuly 29, 2010
An important thing to remember during this financial crisis is that it’s not just the federal government that has mismanaged the public’s money by taking on too much debt and entitlement promises like social security and medicare which it simply cannot service. Like the central planners in Washington D.C., many of our states are also in trouble, namely because of social service programs like state health care and state pension funds.
Over the last several years many state pension funds have experienced massive declines; and because we’re nowhere near the finish line, we can expect even more destruction as stock invested pensions get decimated in coming months and years. This means that the states will be incapable of making payments not only to pensioners, but they’ll be forced to either make massive cuts in essential services like emergency response and government administration, or borrow money from the federal government -- probably both.
Here’s how the states fared in a recent study:
The Pew Center on the States, a nonpartisan think-tank based in Washington D.C., recently used California as the poster child for fiscal dysfunctionality. The Pew Center identified the six factors most responsible for California’s ongoing fiscal woes and then scored the other 49 states on how similar they are to the beleaguered Golden State.
The six factors are:
The results are in the table below, with California being assigned the benchmark number of 30.
- high foreclosure rates;
- increasing joblessness;
- loss of state revenues;
- relative size of budget gaps;
- legal obstacles to balanced budgets — specifically, a supermajority requirement for some or all tax increases or budget bills; and
- poor money-management practices.
…
If you’re a resident of one of the most troubled states in America, here’s a glimpse of what’s to come: higher taxes, layoffs of state workers, longer waits for public services, more crowded classrooms, shorter school years, higher college tuition, and less support for the poor and the unemployed.
But for those of you living in places that aren’t in such rough shape, don’t get too comfortable. Think about this: The 10 states in the worst financial condition account for more than one-third of America’s population and economic output.Lower wages, high unemployment, increased taxes, and more economic woes are almost a guarantee going forward. Regardless of what we’re told is being done to quell the situation, it is clear that nothing has actually been done.
…
The health of individual states is important because the United States’ recovery from the Great Recession depends heavily on the degree to which states emerge from their economic doldrums. But the actions needed to repair finances in the 10 most vulnerable states — think higher taxes and lower government expenditures — could slow down the entire nation’s economic recovery.
source: Investing Answers
It’s only going to get worse. No bureaucrat in Washington or your state capital is prepared to do what’s necessary, so they will continue to kick the can down the road until the road dead ends.
How long will this be?
It’s hard to say, but in terms of the states, we’re likely looking at sooner rather than later. States are already broke, with California, Illinois and New Jersey already showing serious fiscal strain. In the near future we’ll begin seeing states requesting bailouts directly from the federal government. Eventually, we suspect that the majority of states will be standing in the welfare line looking for hand outs.
For now, the US dollar remains fairly strong given our economic problems. In fact, any time a financial emergency spreads across the globe, investors seem to be running to US bonds for safety, so there is still confidence in the US government’s ability to service our existing debt.
However, we believe that once the states begin to require federal involvement to pay government workers, emergency responders and pensioners, we will be much closer to a serious collapse of not only our economic system, but the monetary system as well. It’s only a matter of time before the rest of the world realizes that we’re completely broke and takes action accordingly.
The states blew a government spending bubble, and that bubble is about to pop. The federal debt bubble will not be far behind.
L.A.’s Private Sector Targets High-altitude Public Pension Payouts
SZone.USAugust 2, 2010
Local business leaders are increasingly alarmed about skyrocketing public-sector pension costs.
They fear that in order to meet pension obligations, state and local governments will go after companies’ pocketbooks, slash government contracts for business, and cut back on services that businesses need or that keep the state and city safe.
With future state pension obligations estimated at $550 billion – more than six times California’s general fund budget – and pension obligations of local governments statewide totaling at least that much, business leaders are calling on governments to reform their pension systems and rein in costs.
Business groups are backing Gov. Arnold Schwarzenegger’s plan to reform the state’s pension systems. In addition, they are prodding officials in Los Angeles and other cities to reform their pension plans, even threatening ballot initiatives should these officials fail to act.
“There’s hardly a business meeting today in which people don’t talk about public pension reform,” said Gary Toebben, chief executive of the Los Angeles Area Chamber of Commerce.Public employee unions and pension officials said the concerns of business are overblown and that pension obligations pose less of a risk than critics suggest.
But Toebben said the stakes are high for business.
“Businesses realize that with each passing year, government deficits get larger because of retiree pension and health contributions,” he said. “That leaves two options: cutting services that businesses rely on, or going after businesses for more fees and taxes.”A recent Stanford University study showed the state’s unfunded pension liability had climbed to more than $550 billion. That’s up from $450 billion just two years ago, before the state’s three main pension funds were hit with more than $100 billion in losses in the 2008-09 market meltdown.
Business leaders also cite recent losses in pension fund investment portfolios as cause for alarm. In 2008-09, for example, the state’s largest pension fund, the California Public Employees’ Retirement System, or Calpers, lost 23.4 percent of its value. (Some of that was made up in the 2009-10 fiscal year, when a market rally resulted in an investment portfolio gain of 11.4 percent.)
One of the most outspoken local business leaders on the issue is David Fleming, founding chairman of the Los Angeles County Business Federation and of counsel with the downtown L.A. law firm Latham & Watkins LLP. He blames the public employee unions for creating an unsustainable pension system and then pushing for taxes on businesses to help pay for it.
“It’s no secret that the lavish public pensions engineered by the public employee unions are bringing local governments to the precipice of bankruptcy,” he said. “Those same unions are urging big tax increases on business to pay the bill.”Over the next four years, the city of L.A.’s annual contributions to its three pension funds are projected to rise 85 percent, from the 2010 level of $653 million to $1.21 billion, according to the city’s most recent budget forecast.
That $1.21 billion figure is one-fourth of general fund revenues and more than 40 percent of payroll.
This rise in pension obligations is a major factor in the projected 2013-14 budget deficit of $515 million.
Part of the problem results from pension recipients getting more money. The average annual pension for a retired L.A. civilian worker in 2009 was $40,000, up 54 percent from 2004. The average pension for a retired police officer or firefighter was $53,000 in 2009, up 29 percent from 2004. The figures come from separate pension analyses by the Los Angeles Daily News and Los Angeles Times.
Also, in 2009 there were more than 600 L.A. retirees receiving pensions of more than $100,000, a stunning increase from 164 five years prior.
Toebben said that if the city does not take steps to rein in pensions, the private sector will push for a ballot initiative in 2011 or 2012.
In Long Beach, the business community is already supporting a proposed ballot measure designed to control pension costs. The local City Council is scheduled at this week’s meeting to consider proposals for the measure.
A central cause of the state’s pension debacle was a 1999 law signed by Gov. Gray Davis that liberalized retirement benefits for state workers, and served as a model for many cities, counties and school districts.
The law boosted pension benefits in several ways. It increased dollar amounts by changing formulas, and benchmarked benefits against the last year of employment instead of the last three years. The latter allowed “spiking” – workers loading up overtime and raises in their last year in order to maximize pensions. It also lowered retirement eligibility from 55 to 50 for police and firefighters.
Controlling costs
Business leaders said that they don’t intend to gut public employee pensions. Rather, they want to see future obligations brought under control by reducing pension payouts for new hires and increasing public employee cash contributions to their retirement plans, among other things.
“We’re not saying you go back and take away people’s benefits,” said Joe Czyzyk, chief executive of L.A.-based Mercury Air Group, an air services company. “But you have to draw a line in the sand somewhere. At least let’s look to the future so that the pension contributions don’t overwhelm everything else.”Czyzyk and other business executives said that they are already seeing some indirect effects of the pension crisis.
“My cost of doing business in Los Angeles has gone up,” Czyzyk said. “Rents at the airport are going up. Our DWP rates are going up. And much of this is happening because pension costs are going up and the city needs to backfill its budget.”Another effect, pension critics said, is that government agencies, desperate to save money, are cutting contracts with private companies. Earlier this year, Los Angeles asked contractors to voluntarily cut their bills 10 percent.
“If you do business with the city of Los Angeles, much of the work you have now will disappear,” Alex Rubalcava, an investment adviser, told the Business Journal last week. “It’s already begun with the asking of 10 percent cutbacks in contractors. That’s chapter one of a 20-chapter book.”Companies that rely on funding from the state have similar concerns. Planning Co. Associates in Pasadena, which seeks state funding for local transportation projects on behalf of local government agencies, has seen its business cut back as the state budget crisis has delayed transportation projects.
“If I’m having these issues now with my business, based on all the projections I see about pension obligations, the state budget crisis will only get worse over time and my issues will only get worse, even if the economy itself improves,” said Planning Co. owner David Grannis.In Long Beach, private sector employers are concerned about new fees on business and cutbacks in city services in part to meet increasing pension payouts.
Ten years ago, the city, along with many local governments, didn’t make any pension contributions to Calpers, due to the fund’s huge portfolio gains in the late 1990s. By 2005, though, Long Beach had to pay $48 million into Calpers. Since then, its contribution has increased an average of 9 percent per year, reaching a projected $71 million for the current 2010-11 fiscal year.
But, according to the city’s estimates, the huge loss at Calpers in 2008-09 means Long Beach will have to pay $95 million to Calpers by 2013, about 17 percent of its general fund. In part to offset these payouts, the city has made budget cuts totaling $163 million over the last six years and faces an additional $19 million budget deficit for the 2011 fiscal year beginning Oct. 1.
“We’re extremely concerned that each time business license fees are raised, or new fees come on board – like a new hazardous waste disposal fee that took effect earlier this year, or parking meter rates go up – that affects our bottom line,” said Hilda Sanchez, owner of Minuteman Press in Long Beach. “A big reason the city has to take these actions is because they have to spend more each year paying out pension benefits.”Sanchez said that she is also seeing the effects of cutbacks in services. For example, the city removes graffiti from walls near her business less frequently.
Exaggerated claims?
Public employee unions and pension officials said business leaders and their Republican Party allies are exaggerating the pension problem.
They claim that local and state pension systems, while they could use some tweaks, are essentially sound and they promise to fight what they term as attempts to gut public employee pensions.
“There are a lot of scare tactics being put out there right now,” said Cheryl Parisi, executive director of Local 36 of the American Federation of State, County and Municipal Employees and chairwoman of a coalition of L.A. city unions.Some pension officials agreed. They acknowledged that public pension obligations have increased, but see the increase as moderate over time and not posing a threat to fiscal stability.
“Our belief is that pension obligations, while they have increased, are not going to crowd out other services or force new taxes,” said Brad Pacheco, spokesman for Calpers.Sanchez said big public sector pensions hurt in intangible ways, too: It saps the morale of workers at companies.
“When my employees read about the benefits that Long Beach city employees get, they realize they don’t have anywhere near those kinds of benefits,” she said. “It affects their morale.”
Police Violence on University of California Campuses: Pepper-spraying UC Davis Campus Police Lieutenant's Salary was $110,243 in 2010
39-year old John Pike (shown in photo) is a former U.S. Marine sergeant who has been honored for his police work on campus, but an alleged anti-gay slur by Pike also figured in a racial and sexual discrimination lawsuit a former police officer filed against the department, which ended in a $240,000 settlement in 2008. Pike was hired onto the University of California, Davis police force in 2001.His salary at UC Davis:
2010 Pay - $110,243
2009 Pay - $107,792
2008 Pay - $105,000
In the Face! UC Hypocrisy Hard to Swallow
I feel like I’ve become accustomed to stomaching hypocrisy. Contemporary politics is rife with it. It rarely shocks. Even when I am outraged by hypocrisy, my friends seem busy being outraged by a different hypocrisy, so we can’t get together and talk about it. I can’t remember exactly when this happened. I remember shocked at hypocrisy early in undergrad. I guess it is a gradual process.By now many will have seen the footage of students from University of California, Davis being pepper sprayed by the campus policeman. It seems to be everywhere.
It’s understandable, there is something brazen in the casual disdain with which he dowses the line of seated students. There was also the momentary raised arm to the crowd, like a gymnast about to commence their floor routine, it seemed a performative gesture to either his colleagues, the crowd or the perhaps inevitable global audience.
This student protest at the UC Davis campus was a protest in response to the hypocrisy I speak of and I can understand their resolute outrage. This protest was organised in response to a call for solidarity following the police violence on the UC Berkeley campus a week earlier. UC Berkeley Chancellor Robert J. Birgeneau (whose salary was $416,596 in 2010) ordered police to break up a peaceful rally against increases in tuition fees. Unsurprisingly in the course of breaking up the protest police used batons against students resulting in injuries that included broken ribs.
UC Berkeley is a campus that has a long tradition of student activism dating back to the 1960s. A key moment was in 1969 when, akin to the contemporary occupy movement, students created a community park on campus to campaign for free speech on campus. Then California Governor Ronald Reagan ordered the National Guard onto the campus resulting in widespread injuries and the death of a student.
The actions ordered on both of the UC campuses fit very well within what is becoming a continued pattern of extremely disingenuous disavowals of the willingness to use violence against non-violent protesters in the name of health safety. The argument that violent policeman are ‘bad apples’ doesn’t hold water. Take the UC Davis footage. Yes, it was one officer that used pepper spray against the students but police forces are designed around a strict system of hierarchy and accountability. Senior officers are accountable for the actions of those they are in charge of and other officers have a duty to ensure fellow officers uphold the law. Recall the performative gesture; his intent was clear and no officer stepped forward to prevent students being pepper sprayed or assist injured students.
The responsibility for these actions can’t be disavowed. A junior faculty member has put this in the strongest possible terms in an open letter to the UC Davis Chancellor, Linda Katehi, calling for her resignation.
Through all this though, the deepest hypocrisy lies in the fact that political UC Berkeley as an institution claims to pride itself on this tradition of campus activism. Its website even has a page dedicated to this tradition. Of all the things that should not become hollowed out into a cynical public relations exercise, it is the idealism of young students.
'Anonymous' Hackers Target Pepper-spraying UC Davis Police Officer
Los Angeles TimesNovember 22, 2011
The Internet hacking group Anonymous has launched its latest attack on the UC Davis police officer accused of pepper-spraying student by posting a video online that lists his personal contact information.
In a 10-minute video attributed to the group, a computer-altered voice publicizes the home address, home telephone and cellphone numbers and email address belonging to Lt. John Pike (whose salary was $110,243 in 2010).
PHOTOS: Protests at UC Davis
The mysterious group speaks directly to Pike in the first minute of the video, telling him to “expect our wrath” and threatening, “We are going to make you squeal” as the viral video of Pike pepper-spraying passive protesters plays in the background.
“It is quite difficult to engage in a peaceful protest when you come bearing arms like we’re flies to the swatter. We are here to inform you that it will no longer be tolerated.”
Anonymous members advocate for civil disobedience by hacking into computer systems and releasing private and classified information.
UC Davis Leader Says She Did Not Want Use of Force
The Associated PressNovember 23, 2011
The University of California, Davis, chancellor defended herself Tuesday from criticism over the campus police force's pepper spraying of peaceful demonstrators as information emerged about the officer at the heart of the incident.
Video footage of Lt. John Pike and another officer clad in riot gear casually spraying an orange cloud at the heads of protesters who were sitting peacefully on the ground has sparked national outrage since it began circulating online Friday night. Students gathered on campus Tuesday for the second time in as many days to condemn the violence and urged university officials to require police to attend sensitivity training.
UC Davis Chancellor Linda Katehi, who has faced criticism from students over Friday's incident, defended herself during a town hall meeting Tuesday night. She told an auditorium filled with a little more than 1,000 students that she asked police to remove tents from the university's quad but did not direct them to forcibly remove the demonstrators.
"I explicitly directed the chief of police that violence should be avoided at all costs," she said. "It was the absolute last thing I ever wanted to happen."
She stressed that students have a right to demonstrate peacefully.
"Because encampments have long been prohibited by UC policy, I directed police only to take down the tents," she said. "My instructions were for no arrests and no police force."Pike, another officer and the campus police chief have been placed on paid administrative leave in the wake of an incident that has generated international attention for the 32,000-student campus just west of the state capital, the third most populous in the UC system behind the campuses in Los Angeles and Berkeley.
Not all students who attended the town hall in a performing arts complex were satisfied with the response from Katehi, who attended a rally on campus Monday and apologized to students. Puneet Kamal, 22, an environmental science and policy major, was among those lined up to ask questions Tuesday.
"She didn't say 'I'm sorry that I did this, or I'm sorry I made this call,'" Kamal said. "She said 'I'm sorry that this situation had to happen.' Where's the blame going to?"Natalie Poulton, 20, a communications major, said Katehi has not fully explained what she knew in advance about the police plans for clearing out protesters.
"I want more answers," said Poulton. "She totally didn't explain if there was a miscommunication with the cops and what exactly happened in terms of the higher-ups."
Pike, one of the officers who sprayed the students, is a retired Marine sergeant who has been honored for his police work on campus, but he also figured in a discrimination lawsuit against the university.
He has twice been honored by the university for exceptional police work, including a 2006 incident in which he tackled a scissor-wielding hospital patient who was threatening fellow officers. Afterward, he said he decided against using pepper spray because it might harm his colleagues or other hospital patients.
But an alleged anti-gay slur by Pike also figured in a racial and sexual discrimination lawsuit a former police officer filed against the department, which ended in a $240,000 settlement in 2008. Officer Calvin Chang's 2003 discrimination complaint against the university's police chief and the UC Board of Regents alleged he was systematically marginalized as the result of anti-gay and racist attitudes on the force, and he specifically claimed Pike described him using a profane anti-gay epithet.
Katehi identified Pike as one of the officers involved in the pepper-spray incident in an interview with the campus television station Sunday, and university communications staff confirmed his role Tuesday.
Over the weekend, the hacker group Anonymous, which is affiliated with the Occupy Wall Street movement, posted on its website Pike's phone number and other personal details.
Pike did not immediately return a message left Tuesday at a home address listed in Roseville, a Sacramento suburb. It was not immediately known whether he had hired an attorney.Dieter Dammeier, an Upland lawyer for the Federated University Police Officers Association, the union that represents UC Davis officers, said the operations plan issued by the department includes the use of pepper spray. Dammeier said he does not represent Pike because he is a manager.
"The officers were doing simply what they were instructed to do by upper management there," Dammeier said, referring to police, not university, management. "So the officers are getting beat up pretty good out there, but they were simply doing what they were instructed to do."
The administrator who oversees campus policing said the force has wide discretion in deciding how to respond to specific circumstances.
He said a decision was made to allow the police to clear the tents.
"We didn't think it was going to end as it ended," Meyer said. "Once these actions begin however, there is great discretion for officers to make decisions in the field."
Records show Pike joined the Marines in November 1989, and by the time he left, he had been promoted to sergeant.
Four years later, the university's press office issued a release about accolades Pike received after subduing a UC Davis Medical Center patient who was threatening a fellow officer with scissors and a spray bottle filled a caustic chemical. Pike saw the scissors-wielding patient try to assault an officer and landed "a body block, powering his left shoulder" into her, the release said.
But in that situation, the 245-pound Pike opted not to use pepper spray, because he didn't want to hurt his fellow officers, Pike said.
"You've got all these tools on your belt but sometimes they're not the best tools," Pike said.Tuesday, state lawmakers announced they would hold a hearing on the pepper-spraying incident. Assembly Speaker John Perez sent a letter to the University of California Board of Regents chairwoman Sherry Lansing and UC President Mark Yudof asking for a system-wide investigation.
"Students, parents and the public deserve to have answers to the myriad of troubling questions these incidents have raised," Perez, D-Los Angeles, said in a statement.Yudof later announced he had appointed former Los Angeles Police Chief William Bratton to review the UC Davis incident and provide "an independent, unvarnished report about what happened."
He also appointed the university's general counsel and the UC Berkeley law school dean to examine police protocols and policies at all 10 UC campuses, including discussions with students, faculty and staff.
Student government leaders on campus condemned the use of pepper spray on student protesters and called for Katehi to resign if she fails to enact reforms.
"Major reforms are needed because regardless of whoever is fired or resigns, it won't mean anything if we don't change policy and the way our institutions are run," Adam Thongsavat, president of the Associated Students of the University of California, Davis, said in an interview. "That's what's going to affect students and campus policy and bring awareness."The student government passed a resolution Monday night calling on the state attorney general's office to investigate campus police misconduct. The students are demanding police go through sensitivity training, seek more student representation and review policies on student protests.
Katehi has already asked the Yolo County district attorney's office to investigate, and Chief Deputy District Attorney Jonathan Raven confirmed Tuesday that the department will look into the matter.
Attorney General Kamala Harris was deeply disturbed by the videos of the incident, spokeswoman Lynda Gledhill said Tuesday.
"She's confident they will conduct a quick and thorough investigation of the matter," Gledhill said.On Tuesday, about 50 tents formed an encampment on the site where the pepper-spraying happened as students went about going to class. During her address during the evening town hall, Katehi said she sympathized with the feelings that are leading students to protest.
"I understand the frustration and anger students are feeling right now," she said. "Our economy is in poor shape, employment prospects are the worst in decades and tuition has been increased a number of times."
State Tuition at UC Campuses Increased Almost 50% in Less Than Two Years
Students are paying tuition (note that the state raised tuition by 32% in 2010, 8% in early 2011, and another 9.6% just eight months later, making it double what tuition was just seven years ago), which is funding the salaries of campus police who are attacking them rather than keeping them safe and secure. This is a college campus and there is no excuse for campus police to be attacking student protesters. If you can't protest on a college campus in America, where can you protest! This is a prime example of the police state that the U.S. has become. We will soon resemble communist China and North Korea.This is why California is broke and why tuition for the state's higher education system is so high (taxpayers are on the hook for lifetime pensions, healthcare and survivor benefits as well):
- UC Berkeley Head Coach Jeff Tedford's salary was $2,349,038 in 2010
- UCLA Head Coach Intercol. Athletics Benjamin Clark Howland's salary was $2,076,535 in 2010
- UCLA Professor-HCOMP Ronald W. Busuttil's salary was $1,984,858 in 2010
- UC Berkeley Head Coach Michael J. Montgomery's salary was $1,859,133 in 2010
- UCLA Clinical Professor-HCOMP Khalil M. Tabsh's salary was $1,783,005 in 2010
- UC President Mark G. Yudof's salary was $560,594 in 2010
- UC Berkeley Chancellor Robert J. Birgeneau's salary was $416,596 in 2010
- UC Davis Chancellor Linda Katehi's salary was $382,249 in 2010
- UC Davis Vice Chancellor for Admin. and Resource Mgmt John Meyer's salary was $213,121 in 2010
- UC Davis Police Chief Annette Spicuzza'ssalary was $140,417 in 2010
- UC Davis Police Lieutenant John Pike's salary was $110,243 in 2010
- Legislative Assembly Speaker John Perez's salary was $107,329 in 2010
Flashback: UC Davis Students Arrested after 32% Tuition Hike for 2010 Sparks Protests
CNNNovember 20, 2009
Authorities arrested dozens of angry students at the University of California, Davis, campus late Thursday after they refused to vacate the school's administration building in protest of a 32-percent tuition hike.
The 52 students were taken into custody by the Davis Police Department and deputies from the Yolo County Sheriff's Department, according to Claudia Morain, a UC Davis spokeswoman.
The arrests at the Mrak Administration building came about four hours after the normal 5 p.m. PT (8 p.m. ET) closing time. At one point, as many as 150 students were at the building protesting the tuition increase, Morain said.
CNN affiliate KCRA captured footage of students outside the building shouting,
"Who's university? Our university!"In response to the protests, university officials said they will convene a meeting at noon Friday between students, the director of student affairs and the school's top budget officials.
Nearly 400 miles south and hours earlier, hundreds of students marched and chanted against the increase while outside the UCLA building in Los Angeles where regents met to vote on the hike.
Protesting students and others say the increased tuition will hurt working and middle-class students who benefit from state-funded education. But officials argue that a fee increase and deep cuts in school spending are necessary because of a persistent budget crisis that has forced reductions across California's state government.
"We're fired up. Can't take it no more," students chanted as they marched and waved signs at UCLA. "Education only for the rich," one sign read.After the vote, students rushed to the parking decks to stage a sit-in to block regents' vehicles from leaving. Campus police and California Highway Patrol officers in riot gear stood nearby.
As one regent member walked out, students surrounded his path shouted,
"Shame on you, shame on you."The situation ended without incident as students gradually left the scene.
The University of California's Board of Regents approved the plan a day after the regents' finance committee also approved the 32-percent hike in undergraduate tuition fees...
On Wednesday, hundreds of students, faculty and campus workers protested outside the finance committee meeting on the UCLA campus. Fourteen people were arrested Wednesday morning after they disrupted the regents' meeting with chanting, police said. Other protests, including "tent cities," were under way on other University of California campuses across the state.
University executives told the regents the fee hikes were needed since they've already made deep spending cuts in the past two years -- cuts forced by the state budget. About 26 percent of the $20 billion spent each year by the system comes from the state's general fund and tuition and fees paid by students, according to a summary on the regent's Web site.
The first tuition hike, which takes effect in January, will cost undergraduate students an additional $585 a semester. The second hike kicks in next fall, raising tuition another $1,344, she said.
The fee increases would be balanced by a raise in "the level of financial assistance for needy low- and middle-income students," according to a statement from the Board of Regents. The tuition hike is expected to raise $505 million for the university system, and about $175 million of that money would go toward financial aid for low-income students, the board said.
University of California Panel Approves 8% Tuition Hike for 2011
The Associated PressNovember 18, 2010
University of California committee has approved a plan to raise student fees by 8 percent next fall while expanding financial aid to more students.
Thursday morning’s vote by the finance committee of the UC Board of Regents comes a day after a student protest left four police officers and more than a dozen protesters arrested.
Later in the day, the full board is expected to approve the tuition hike, which follows a 32 percent increase this year.
In fall 2011, student fees for California residents will increase by $822 to more than $11,000. That doesn’t include individual campus fees or room and board.
Flashback: UC Davis Students Arrested after 32% Tuition Hike for 2010 Sparks Protests
CNNNovember 20, 2009
Authorities arrested dozens of angry students at the University of California, Davis, campus late Thursday after they refused to vacate the school's administration building in protest of a 32-percent tuition hike.
The 52 students were taken into custody by the Davis Police Department and deputies from the Yolo County Sheriff's Department, according to Claudia Morain, a UC Davis spokeswoman.
The arrests at the Mrak Administration building came about four hours after the normal 5 p.m. PT (8 p.m. ET) closing time. At one point, as many as 150 students were at the building protesting the tuition increase, Morain said.
CNN affiliate KCRA captured footage of students outside the building shouting,
"Who's university? Our university!"In response to the protests, university officials said they will convene a meeting at noon Friday between students, the director of student affairs and the school's top budget officials.
Nearly 400 miles south and hours earlier, hundreds of students marched and chanted against the increase while outside the UCLA building in Los Angeles where regents met to vote on the hike.
Protesting students and others say the increased tuition will hurt working and middle-class students who benefit from state-funded education. But officials argue that a fee increase and deep cuts in school spending are necessary because of a persistent budget crisis that has forced reductions across California's state government.
"We're fired up. Can't take it no more," students chanted as they marched and waved signs at UCLA. "Education only for the rich," one sign read.After the vote, students rushed to the parking decks to stage a sit-in to block regents' vehicles from leaving. Campus police and California Highway Patrol officers in riot gear stood nearby.
As one regent member walked out, students surrounded his path shouted,
"Shame on you, shame on you."The situation ended without incident as students gradually left the scene.
The University of California's Board of Regents approved the plan a day after the regents' finance committee also approved the 32-percent hike in undergraduate tuition fees...
On Wednesday, hundreds of students, faculty and campus workers protested outside the finance committee meeting on the UCLA campus. Fourteen people were arrested Wednesday morning after they disrupted the regents' meeting with chanting, police said. Other protests, including "tent cities," were under way on other University of California campuses across the state.
University executives told the regents the fee hikes were needed since they've already made deep spending cuts in the past two years -- cuts forced by the state budget. About 26 percent of the $20 billion spent each year by the system comes from the state's general fund and tuition and fees paid by students, according to a summary on the regent's Web site.
The first tuition hike, which takes effect in January, will cost undergraduate students an additional $585 a semester. The second hike kicks in next fall, raising tuition another $1,344, she said.
The fee increases would be balanced by a raise in "the level of financial assistance for needy low- and middle-income students," according to a statement from the Board of Regents. The tuition hike is expected to raise $505 million for the university system, and about $175 million of that money would go toward financial aid for low-income students, the board said.
'London Burning' Will Be Replicated in Los Angeles Before Too Long
The number of people arrested in London rose to 922 since trouble began on August 6th, with 401 suspects charged. The huge number drew notice. Peter Tapsell, a veteran Conservative Party lawmaker, called on Cameron to draw inspiration from the response of U.S. authorities to anti-Vietnam protests in the 1970s. Tapsell said he recalled law enforcement in Washington, D.C., rounding up demonstrators and imprisoning them in a sports stadium. He did not elaborate, but authorities in 1971 set up an emergency detention center next to Washington's RFK stadium to hold demonstrators after the largest mass arrest in U.S. history. Tapsell asked Cameron if Britain's Wembley Stadium, the country's showpiece soccer arena could be used. Cameron insisted the stadium would be used only for "great sporting events," not the detention of rioters. - UK to Deploy Military, Grant New Police Power, Restrict Social Networking, and Use Facial Recognition to Hunt Rioters and Looters, August 11, 2011Who Are the London Rioters?
The Superdome in New Orleans after Katrina was meant to be a hurricane refuge, but those who sought shelter there described it as a lawless "concentration camp." "People were locked in the dome like prisoners," said a 13-year veteran of the New Orleans police force who asked not to be identified. Much of the frustration voiced by the evacuees concerned the lack of information. People were prevented from leaving the arena and were desperate for news of what had happened to their friends, neighbors, family members and homes. Many blamed the officials for failing to give them any updates on the situation. "We were treated like this was a concentration camp," said Audrey Jordan of the Superdome. "One man couldn't take it. He jumped over the railing and died." - Stadium Hurricane Refuge Like a 'Concentration Camp', Agence France Presse, September 2, 2005
The Superdome During Katrina
A disaster medical assistance team, DMAT, from San Francisco area, CA-6, served in the Superdome during the Katrina Hurricane. Conditions were horrific.
Greta Van Susteren of Fox interviewed Dr. Charles Burnell, an emergency room physician who was providing medical care in the Superdome. Asked about the level of violence among the 20,000 displaced residents who sought shelter inside the giant stadium, Dr. Burnell said: "We had three murders last night. We had a total of six rapes last night. We had the day before, I think, there were three or four murders. There were half-a-dozen rapes that night. We had one suicide last night. We had one military policeman shot." Dr. Burnell described the Superdome situation as "very unstable, very high tension, a very dangerous environment." While National Guardsmen were on hand for protection, he said that "every time there was an incident that broke out, they had to tend to that, which left us uncovered." Burnell said the task of treating people inside the stadium became impossible after they ran out of supplies. "We did not have oxygen, we did not have any medications to speak of," he said. But what forced the New Orleans doc to finally abandon the giant evacuation center was the threat of violence. "Until I can insure that I'm not putting my life in any significantly dangerous situation as I was before - I will not be back in the Superdome," he told Fox. - Doc: 6 Murders, 12 Rapes Inside Superdome, Newsmax.com, September 1, 2005
Bell, California, the Poster Child for Bad Government: Exorbitant Salaries, Lavish Pension Benefits, a Looming Default on $35 Million in City Bonds, and Illegal Property Taxes
Lessons from the Bell, California Fiasco
High government salaries means soaring pension costs that taxpayers cannot afford.Reason Foundation
August 24, 2010
The City of Bell has become the poster child for bad government. Exorbitant salaries, lavish pension benefits, a looming default on $35 million in city bonds, and illegal property taxes have all come to light recently. And as a result, taxpayers across California are focusing new scrutiny on their own local officials.
The biggest long-term threat to taxpayers and budgets is the pension crisis. Bell City Manager Robert Rizzo was raking in a salary of nearly $800,000, and a total compensation package of more than $1.5 million that included benefits such as 28 weeks worth of vacation and sick time. That puts taxpayers on the hook for over $600,000 a year for Rizzo’s pension—for the rest of his life—when he retires.
The Bell scandal is a microcosm of a new class struggle—in California and across the nation—between taxpayers and government employees. Government employees have become the new privileged class.
The argument of public workers has always been that they do not earn as much in salary as comparable private-sector workers, so governments must make up for this inequity through increased job security and greater pension benefits. If this was true a generation or two ago, it certainly is not today. The most recent Bureau of Labor Statistics report on employee compensation revealed that, as of March 2010, state and local government workers earn, on average, nearly 44 percent more than do private-sector workers, including 34 percent higher salaries and wages and over 66 percent greater benefits.
California taxpayers are already paying pensions of over $100,000 a year to more than 12,000 former state and local government workers, including over 9,000 state and local employees covered by the California Public Employees’ Retirement System (CalPERS) and greater than 3,000 former school administrators or teachers covered under the California State Teachers’ Retirement System (CalSTRS).
At the federal level, a recent USA Today analysis, based on Bureau of Economic Analysis data, found that government employees’ average compensation has grown to more than double that of private-sector workers. Federal workers earned average pay and benefits of more than $123,000 in 2009, compared to a little over $61,000 in total compensation for private workers. Since 2000, federal worker compensation has increased 36.9 percent after adjusting for inflation while private-sector workers saw only an 8.8 percent increase.
The silver lining of the Bell fiasco is that it has awakened taxpayers to the magnitude of the public employee compensation problem (recent studies suggest the state has $500 billion in unfunded pension liabilities), and hopefully shamed some elected officials into implementing some real transparency reforms.
The excessive pay and benefits received by many government workers will not be solved, however, by merely increasing transparency of compensation data or tinkering around the edges of the pension system by offering slightly less generous benefits for new employees or requiring them to work a couple of more years before being eligible for retirement. The entire system needs to be overhauled. New employees should be switched to a 401(k)-style defined-contribution system, with pay and benefits comparable to those in the private sector. Only by seriously addressing excessive public employee pay and benefits can state and local governments in California ever rein in their enormous and unsustainable bureaucracies and return to any semblance of fiscal responsibility.
Other Cities Across Southern California to Pay Lavish Bell, Calif., Pensions
MSNBCAugust 2, 2010
Cities across Southern California will be on the hook for the pensions paid to municipal officials in Bell, where excessive salaries led to a recent purge of city leaders, according to pension experts.
The Los Angeles Times reports that more than half of former city manager Robert Rizzo's $600,000-a-year pension will be paid by taxpayers in 140 small cities and special districts that are in the same pension liability pool. This includes Glendale, Simi Valley, Ventura, Norco, La Canada Flintridge and Goleta, as well as Rizzo's former employers, Hesperia and Rancho Cucamonga.
In the case of Bell's former police chief, Randy Adams, the city is only responsible for 3 percent of his estimated $411,300-a-year pension under CalPERS, the state's public employee retirement plan. Taxpayers in Glendale, Simi Valley and Ventura would have to pick up the rest.
Critics of the state's complex pension system are pointing to the scandal in Bell as an example of why the CalPERS should be overhauled. An estimated 90 percent of public agencies in California participate in the system.
Gov. Arnold Schwarzenegger and the two gubernatorial candidates, Meg Whitman and Atty. Gen. Jerry Brown, are urging reforms in the system.
"Even the governor's office couldn't figure these Bell pensions out," said Marcia Fritz, a certified public accountant and president of the California Foundation for Fiscal Responsibility.Even though Rizzo and Adam's salaries were relatively modest until they were hired in Bell, other cities will be responsible for much of their pension costs. When they resigned last week, Rizzo was making nearly $800,000 a year and Adams was making $457,000.
Bell hired Adams at more than double the salary he was making in Glendale. That salary spike also doubled his eligible pension amount under CalPERS. City managers in Glendale and Simi Valley, where Adams previously worked, estimate they'll have to come up with an extra $40,000 in taxpayer dollars each year to cover the pension costs. Ventura's tab could go much higher.
"We had no control over his final year's salary," said Glendale City Manager Jim Starbird. "Yet the rest of us will be bearing the brunt of Bell's decision."CalPERS last week said it is putting both men's pensions on hold pending multiple investigations into Bell's salaries. Glendale and Ventura have sent letters to the attorney general supporting investigations.
California Students Don Jerseys with Stitched-in RFID Chips as School Officials Log and Track Movement 'Required by the Federal Headstart Program'
In early July 2009, county officials in Richmond, California, started talking with AT&T and Dynamic Computer Corp. about using a portion of a $1.1 million stimulus grant from the U.S. Department of Health and Human Services to build such a system. [Source]The George Miller III Headstart site, in Richmond, CA has begun implementing RFID tracking technology for its 200 preschoolers aged 3-5. According to Karen Mitchoof, public information officer for the Contra Costa Employment and Human Services Department, the primary goal of the technology is to supplement safety and to track Federally mandated statistics required for the Headstart program. With the introduction of RFID technology made possible by a Federal stimulus grant of $115,000, the Headstart site was able to deploy an array of sensors throughout the site to read signals emitted by RFID transmitters embedded in jerseys to be worn by students. The George Miller III site, which cost $50,000 to deploy, is the first of three possible sites slated for this program. Other sites will be added based on considerations such as the physical layout of the site. [Source]
Preschoolers in Richmond, California showed up for school and were handed jerseys embedded with Radio Frequency Identification (RFID) tags. RFID tags are tiny computer chips that are frequently used to track everything from cattle to commercial products moving through warehouses. Now the school district is apparently hoping to use these chips to replace manual attendance records, track the children’s movements at school and during field trips, and collect other data like whether the child has eaten or not. [Source]
Since July 1, 2010, 200 preschoolers at the George Miller III Head Start Program in Richmond, California—and their teachers—have been wearing lightweight vests, much like soccer jerseys, with radio frequency identification (RFID) chips inside that track and document their every move. The system was put in place by directors of the Head Start program, to increase security and streamline the required process of taking hourly attendance. The county hopes to deploy the system in all 19 Head Start programs countywide. [Source]
California Head Start Using RFID to Track Preschoolers (Excerpt)
An RFID tracking program, funded by a federal stimulus grant, has drawn the ire of privacy advocates in California, prompting the EFF and ACLU to call the technology “insecure” and “risky”.InfoSecurity
September 16, 2010
At the start of this school year, as part of its reporting requirements mandated by the federal Head Start program, the George Miller III Head Start program based out of Richmond, Calif., began using RFID chips to track 200 preschoolers.
California RFID Tracking Device is in Use for Preschoolers
EzineAugust 14, 2011
A federal grant is giving money to California’s Contra Costa County to track preschoolers using RFID chips. These RFID (Radio Frequency Identification) chips are a device that tracks the exact location of the item the tag is on. This is used all over on items such as CD’s, electronic devices, clothing and more. It helps to prevent theft by alarming the doors if someone were to walk out with an item not paid for or not “de-magnetized” at the check stands.
These chips can also be used for tracking people’s behavior through their personal items. The George Miller III Head Start program in Richmond, California is the first school to adopt this new technology here in California. This controversial chip is not placed inside the human body, but worn attached to a Jersey that the children will have to wear. These jerseys will have a RFID chip inside of it and every door at the school will automatically check them in. This helps them cut cost and keep “inventory” of the children.
A lot of controversy has come along with these chips. Even though they seem harmless because they are worn outside the body, parents wonder why this type of security and monitoring is needed for preschoolers. This seems above and beyond any type of monitoring needed for children under the age of five.
What the county is hoping to benefit from the chip are the children’s movements for data collection, automatic attendance and tracking meal schedules.
According to a county official:
They are implementing this to reduce the cost of teachers manually tracking this information so that they can better serve the needs of their students and have more time to teach them.The question is… how much time does it actually save? Do the benefits of this device outweigh the risk and cost/upkeep? What if someone forgets their jersey at home or a chip starts acting up and the system fails? Then it would do more harm than good, taking the teachers attention away for an even longer period of time trying to fix the system and manually count the kids who forgot their jersey.
Is it safe? That's a question of many parents whose children attend this school. After they had approved this new program they had not designed an opt-out option for parents who were concerned about this. They have been using this RFID system for a long time in the UK and Japan with small children because they are faster and harder to keep track of. They say it is great for safety, protecting kids from being kidnapped and abducted. The other side of the argument says because these trackers are only embedded in the clothing, it would be easy for a child to remove the jersey, or whatever article of clothing the RFID was attached to and then it would be useless for safety.
Are these chips a false sense of security for parents and school officials or do they really help in giving teachers more time to teach your children? Whatever your thoughts are on this device, technology has come a long way and it is only getting better.
Electronic Monitoring – Fun for the Whole Family
The InformantSeptember 7, 2010
Radio Frequency Identification (RFID) technology is rapidly becoming a part of daily American life. The microchip-based locative technology, which allows a RFID reader to gather information from embedded chips, can be found in passports, driver’s licenses, transit passes, clothes and even pets.
While RFID can be useful when locating the car keys you’ve buried in the couch (again), people seem to get the heebie-jeebies when it comes to using these chips on people.
In 2005, California passed a law making it illegal to embed RFID chips under a person’s skin, a critical update to the Golden State’s privacy laws. However, the Contra Costa School District has found a way around this block. As of this year, roughly 200 preschoolers at Richmond’s George Miller III Center are required to wear basketball-style jerseys with RFID chips woven into the garment. Dubbed CLOUDS, or the Child Location, Observation and Utilization Data System, the child tracking program is intended to help teachers keep track of students, supposedly allowing more time for instruction.
The program will be funded by $160,000 in federal stimulus funds disbursed to Contra Costa County. One Solution Technology, a subsidiary of Testing House Inc, is providing the RFID technology. According to the company’s website, Testing House provides automated surveillance equipment and has contracts in China and Malaysia, countries where electronic surveillance by the government is widespread.
Unsurprisingly, CLOUDS has attracted criticism from civil liberties and privacy advocates, who succeeded in blocking a similar tracking program in rural Sutter County’s Brittan Elementary School five years ago. The Electronic Frontier Foundation, which was involved in the lawsuit against the Sutter tracking program, has concerns about the security and privacy implications of putting RFID chips on preschoolers.
“How secure are these chips?” asked EFF Spokeswoman Rebecca Jeschke. “How hard would it be for someone to eavesdrop on the tracking that’s going on?”Jeschke noted that RFID chips are notoriously insecure and can be “skimmed” (or read) by unauthorized people with ever-cheaper RFID readers. The EFF plans to seek information about these matters as well as what information will be gathered, how long it will be stored and how administrators will use such data.
Beyond privacy matters, the implementation of such a tracking program at a Head Start facility, which serves children from disadvantaged families, is another sign of the government’s increasing reliance on law enforcement techniques and institutions to deal with America’s most marginalized populations. Lillie Coney, the associate director of the Electronic Privacy Information Center, said the Contra Costa School Board’s decision to “beta-test” RFID tracking at a Head Start facility in a notoriously poor city consciously targeted a vulnerable population.
“They’re looking for a place where they have get it in under the radar,” Coney said of CLOUDS. The children involved in this program, she said, are “basically lab experiments – they’re learning their colors and numbers” and are loathe to disobey the instructions from a teacher.On a more sinister note, introducing tracking technology to manage schoolchildren in poor areas is eerily similar to techniques used to track parolees and probationers. Richmond, which is one of the most violent cities in California, has a significant number of parolees and probationers, some of whom may have children at the George Miller III center. Acclimatising Richmond’s children to electronic monitoring at an early age, says Coney of EPIC, will foster a “prison mentality” and make it easier for school officials to punish students for perceived infractions.
Californians are decidedly against electronic monitoring of students. In 2008, the legislature passed SB 29, which would have imposed limits on electronic tracking in schools, only for Governor Arnold Schwarzenegger to veto the bill.
“Californians are really concerned about this,” said Rebecca Jeschke of the EFF.The question is, are state and federal officials listening?
Goodbye Roll Call, Hello RFIDs
IEEE Spectrum
September 23, 2010
September 23, 2010
But it's a nostalgia I may not share with my kids, as tracking devices have begun to dispose of the ritual all together. Last month, a preschool in Richmond, California installed a curiously expensive, high tech system to track the attendance of its students. And it could serve as a pilot program for others to come.
Upon arriving in the morning, according to the Associated Press, each student at the CCC-George Miller preschool will don a jersey with a stitched in RFID chip. As the kids go about the business of learning, sensors in the school will record their movements, collecting attendance for both classes and meals. Officials from the school have claimed they're only recording information they're required to provide while receiving federal funds for their Headstart program.
However, the story has caught the attention of both the ACLU and the Electronic Frontier Foundation, who have expressed alarm at the potential infringement of privacy rights. Together, they have submitted a letter of concern to school officials, including a request that they clarify what security precautions were put in place with the program.
This is not the first time a school has tried to track its students with RFID. In 2005, according to the AP, another grade school in California handed out RFID badges and was met with an equal amount of outrage from the ACLU and privacy rights watch dogs.
Aside from privacy issues, the project has stirred debate about resource allocation. The RFID system was installed with funds from the Federal stimulus program and carries a price tag of $50,000. Moreover, it was designed to replace a task which, from the outside, seems only minimally taxing to budget and personnel—and which, in my case, served to create lasting memories.
Crazy Environmental Extremists have Destroyed California's Agriculture Industry
John Bryson, President Obama’s nominee to head the Commerce Department, told a University of California Berkeley audience in 2010 that a cap and trade system was a good way to hide a carbon tax from the public. Bryson, formerly the CEO of Edison International, said that a carbon tax was the new “third rail” of politics because politicians wouldn’t want to tax energy directly. “I think it’s still unlikely there’ll be a carbon tax bill because I think in the end a very high percentage of the members of Congress think it’s kind of the third rail to support a tax, even if it’s a carbon tax,” Bryson said. “Greenhouse gas legislation, either with a tax or with cap and trade – which is a more complicated way of getting at it but it has the advantage of politically sort of hiding the fact that you have a tax – but that’s what you’re trying to do,” he added. [Source]The Central Valley of California is often referred to the "Congress-created Dust Bowl" by locals because extreme environmental policies from the left-wing have cut-off water to the area. Senator Barbara Boxer (D-CA) and her colleagues have water cut-off because a 3-inch fish would sometimes get caught in the water pipes. While Sarah Palin isn't my favorite member of my party, I like what she said about it. "“A faceless government is taking away their [California farmer's] lifeline, water, all because of a 3-inch fish," Palin said. “Where I come from, a 3-inch fish, we call that bait. There is no need to destroy people’s lives over bait.” One can drive north on the Highway 5 and see miles of barren land. This is our liberal elected officials at work. Some of the towns have up to 45% unemployment, and most of the inner-state counties have unemployment rates which are higher than the statewide average (12%), which in turn is higher than the national average (9%). [Source]
Climate: California Approves Carbon Cap-and-Trade
Ecocentric BlogDecember 17, 2010
OK, so a national carbon cap-and-trade program is, as we've said many times before, extremely dead. And at this point, no one has any idea what form energy and climate legislation might take over the next couple of years, or whether anything's really possible.
Climate change hasn't gone away, even if many people are pretending that it has—NASA has reported that 2010 will likely be the hottest climate year on record. But that's not translating to national action any time soon, even if the international climate process has come back from the dead.
Into that vacuum steps the great state of California, however, where regulators voted last night to approve the creation of a comprehensive carbon cap-and-trade program. The state's powerful Air Resources Board (ARB) voted 9-1 to approve the plan, which will be the key part of California's effort to reduce its greenhouse gas emissions to 1990 levels by 2020, an ambition that was put into law in the state's 2006 climate change act, known as A.B. 32. As ARB chairman Mary Nichols said in a statement following the vote, which came after testimony from more than 170 witnesses:
This program is the capstone of our climate policy, and will accelerate California's progress toward a clean energy economy. It rewards efficiency and provides companies with the greatest flexibility to find innovative solutions that drive green jobs, clean our environment, increase our energy security and ensure that California stands ready to compete in the booming global market for clean and renewable energy.The cap-and-trade will eventually cover about 85% of the state's industrial greenhouse gas emissions, with the rest of California's emissions covered by fuel-efficiency standards and other regulations. The cap-and-trade system will be relatively straightforward, at least in theory: power plants, oil and gas refineries, steel manufacturers and other heavy industries that emit more than 25,000 tons of CO2 a year will be put on a carbon cap. At first they'll receive free allowances that will cover most of their emissions, but over time they'll have to buy those allowances through quarterly auctions that will begin in 2012. If a company manages to keep its emissions level below the cap, it will be able to sell off excess allowances to other companies that might be emitting above the cap—hence the "trade" in cap-and-trade.
Companies will also be allowed to purchase carbon offsets, although the final rules over what will constitute an offset have yet to be set. Expect that to be controversial—dozens of witnesses and a few ARB members spoke out yesterday against a provision that would have made forest clear-cutting eligible to receive credits for improved forest management. Many environmental groups worry that such a standard could inadvertently encourage forest loss, making the offsets virtually meaningless—though the Nature Conservancy, for one, is in favor of the provision. The question is whether the rules will actually encourage the planting of more trees over time, increasing the overall amount of carbon stored in California's forests.
"The total amount of carbon must be increased and it must be maintained over the long-term," says Gary Gero, the president of the Climate Action Reserve, a group that certifies and tracks offsets. "This is going to continue to evolve over the future."Industry has always been, at best, wary about California's climate-change law, but with the defeat of Proposition 23 on the November ballot—which would have all but blocked A.B. 32—there's little choice but to embrace it now. Still, there are concerns about the overall cost of the cap-and-trade system on energy and electricity prices, and on a state economy that is suffering through 12% unemployment. As John Telles, the one ARB member who voted against cap-and-trade, told Climatewire:
This is a regressive tax on the most economically disadvantaged communities. I don't think we can pass something that doesn't in very strong language protect the people. This is a moral issue that's beyond the issue of greenhouse gas reductions.Still, as Governor Arnold Schwarzenegger—who sees A.B. 32 as a chief part of his legacy—has said time and time again, taking strong action on global warming can help the state build its green economy.
"Adoption of a program like this is probably California's best insurance against future recessions," Nichols told the San Francisco Chronicle.With a $1.7 trillion gross state product, California alone is the world's eighth-largest economy, so even if it is acting alone while the rest of the country drags its feet on climate change, the state has a real chance to make a difference. It also means the concept of carbon cap-and-trade may not be quite dead yet.
California Regulators OK Major Greenhouse Gas Rules and Cap-and-Trade Scam
The Associated PressDecember 21, 2010
Hoping other states will follow suit, California regulators overwhelmingly approved the nation's most extensive system giving owners of power plants, refineries and other major polluters financial incentives to emit fewer greenhouse gases.
The Air Resources Board voted 9-1 Thursday to pass the key piece of California's 2006 climate law — called AB32.
"We're inventing this," said Mary Nichols, chairwoman of the state's air quality board. "There is still going to be quite a bit of action needed before it becomes operational."Officials said they hope that other states will follow the lead of the world's eighth largest economy. State officials also are discussing plans to link the new system with similar ones under way or being planned in Canada, Europe and Asia.
California is trying to "fill the vacuum created by the failure of Congress to pass any kind of climate or energy legislation for many years now," said Nichols.
A standing-room only board chambers featured testimony from more than 170 witnesses Thursday. Outside the chambers, a few climate change skeptics held signs reading "Global Warming: Science by Homer Simpson."
Some businesses that would fall under the new rules say the system could dampen California's already flagging economy, complicate lawmakers' efforts to close a $28.1 billion revenue shortfall and lead to an increase in the price of electricity.
The rate increases, however, would still need approval from the state.
Gov. Arnold Schwarzenegger told the board he is sensitive to the recession, but argued that many of the new jobs being created under the system are in the clean technology industry.
"The real jobs we're creating right now are green jobs. Since 2006 or so green jobs have been created 10 times faster than in any other sector, so it's also an economic plus," he said.But he said reducing greenhouse gas pollution is not just about climate change, but about human health and national security.
"I despise the fact that we send $1 billion a year to foreign places for our oil and to places that hate us. We send this money to people that hate us and that are organizing terrorists and trying to blow up our country," he said.Supporters say the system will help spur economic recovery and innovation, pushing business to invest in clean technologies.
They say the billions of dollars the state collects in the system could help fund clean air programs and help offset any increases in utility rates. Details of the uses of these new funds is still uncertain.
California has already enacted the strictest climate-related regulations in the country involving renewable energy mandates for utilities, tighter fuel-efficiency standards for automobiles and low-carbon fuel standards.
The state's landmark climate law had a Jan. 1, 2011, deadline for devising and enacting the so-called cap-and-trade system.
Here's how it would broadly work:
A company that produces pollution, such as a utility or a refinery, buys a permit from the state that allows it to send a specified amount of carbon dioxide and other greenhouse gases into the air each year.The lone dissenting board member, Dr. John Telles, said he had concerns that the new market created by the regulation was too vulnerable to cheating.
Those permits could then be bought and sold by the polluters in a marketplace.
If a company in Fresno is 15 percent under its pollution allowance, it can sell the unused portion to a company in Long Beach that has exceeded its quota. The Fresno company gets to keep the money.
Polluters can even make a profit, if the marketplace sets a price above the initial cost of the permit.
"We're potentially vulnerable here to be manipulated," he said. "And I don't see enough safeguards in the design of the market."The board's staff said it would be working on market issues in the coming year before the launch of the program, but recognized that they were creating something that had not been tried before.
Adding another wrinkle, a company that exceeds its allowance can also buy what are called "offsets." These can be bought by companies with forestry or other projects that reduce greenhouse gases. Those companies can sell those to polluters in the marketplace, also at a profit.
Under the new California rules, regulators would enforce limits on heat-trapping gas emissions beginning in 2012, eventually including 85 percent of the state's worst polluters. The amount of allowed emissions would be reduced over time, and the regulations would expand in 2015 to include refineries and fuel distributors, such as oil companies. The cap would reach its lowest level in 2020, when California wants its greenhouse gas emissions reduced to 1990 levels.
Ninety percent of the allowances would be free in the first years of the program to give industry time to upgrade to cleaner equipment or account for increased future costs as the cap tightens. Over time, as the cap gets lower and fewer allowances are available, costs would rise.
"The idea is to incentivize clean technology over fossil fuels by putting a price on carbon," said Jon Costantino, a senior adviser at a Sacramento law firm who formerly served as the climate change planning manager at the Air Resources Board.Business groups raised concerns that the board had not yet given hard details about what each facility's allowances would be.
"It's crucial for companies to know what their compliance requirements are going to be far in advance," said Dorothy Rothrock of the California Manufacturers and Technology Association.State officials say they had to act, because of years of delays in Washington.
"There are definitely going to be some costs incurred right up front for these companies," she said.
"The goal of (the law's) authors in 2006 was to lead by example, and being a leader you have to bring others along with you," Nichols said.A bill to place a limit on the amount of greenhouse gases nationwide narrowly passed the U.S. House in 2009, died in the Senate because all Republicans and some Democrats from coal- and industry-heavy states balked about how it would raise electricity bills.
Obama, who made the climate bill the centerpiece of his Democratic agenda, pulled support for it after the midterm elections put Republicans in control of the House. The president said he would be looking at other ways to address climate change.
While the Environmental Protection Agency has proposed the first-ever rules to reduce greenhouse gases from large industrial polluters, the GOP, with some support from Democrats, vows in 2011 to block it from moving ahead with the regulations.
California's system, however, could end up being linked to ones being developed in other countries. State officials are talking with the European Union as well as provinces in China and Canada to link systems.
In the U.S., New Mexico narrowly approved its own cap-and-trade program last month and OK'd the state's participation in a regional market. There is another market in the works in the Midwest. Another program exists in the Northeast and Mid-Atlantic states.
Epic Fail: Global Warming Solutions
PPJ GazetteFebruary 8, 2011
A court has tentatively ruled against California’s cap-and-trade law because alternatives were not considered. But then, neither were climate facts or the economic impact.
There’s a delicious irony in the ruling by San Francisco Superior Court Judge Ernest Goldsmith barring the California Air Resources Board (CARB) from implementing AB32, the Global Warming Solutions Act of 2006.
In the opinion of the court, CARB failed to complete the required environmental review under the California Environmental Quality Act because it did not adequately analyze the legislation to see if there are better ways to get the job done.
One of the plaintiffs in the case is the Center on Race, Poverty and the Environment, a group of rabid environmentalists who backed the passage of AB32.
Claiming to seek environmental justice for minorities, the center sued on the grounds that CARB’s implementation plan was too friendly to business.
According to the ruling, the Air Resources Board plan “seeks to create a fait accompli by premature establishment of a cap-and-trade program before alternative (sic) can be exposed to public comment and properly evaluated by the ARB itself.”
Now businesses, consumers, taxpayers and others adversely affected by the law presumably will have yet another opportunity to expose AB32 as an ineffective and draconian attempt to repeal the Industrial Revolution, at least at the state level, and push California even closer to the economic precipice.
AB32 was signed by Gov. Arnold Schwarzenegger in 2006. It required that by 2020, California’s emissions of carbon dioxide, which every human being exhales and every green plant inhales, and other so-called greenhouse gases be reduced 25% to 1990 levels.
A 2009 study found AB32 would cost 900,000 jobs due to increased costs to consumers and an additional 1.1 million jobs due to increased costs on small business, as AB32 caused energy prices to “necessarily skyrocket,” as President Obama once put it.
The study put the annual cost of AB32 at $49,691 per small business and $3,857 per household, or $52 billion in added burdens for California families.
That’s a lot of pain for no gain.
Studies of the Kyoto protocol showed its imposition of a global regime of emissions control would reduce temperatures by an amount too small to measure or matter.
What could California by itself do?
AB32 supporters say California should lead by example. Yeah, right over the economic cliff.
We can only hope that a more thorough review of AB32 would lead to the conclusion that the best implementation plan would be to have none.
California Farmers Say Feds Make Drought Worse
USA TODAYJuly 28, 2009
The road to Todd Allen's farm wends past irrigation canals filled with the water that California's hot Central Valley depends on to produce vegetables and fruit for the nation. Yet not a drop will make it to his barren fields.
Three years into a drought that evokes fears of a modern-day dust bowl, Allen and others here say the culprit now isn't Mother Nature so much as the federal government. Court and regulatory rulings protecting endangered fish have choked the annual flow of water from California's Sierra mountains down to its people and irrigated fields, compounding a natural dry spell.
"This is a regulatory drought, is what it is," Allen says. "It just doesn't seem fair."For those like Allen at the end of the water-rights line, the flow has slowed to a trickle: His water district is receiving just 10% of the normal allocation of water from federal Bureau of Reclamation reservoirs. He says he's been forced to lay off all his workers and watch the crops die on his 300 acres while bills for an irrigation system he put in are due.
"My payments don't stop when they cut my water off," Allen says.Although some farmers with more senior water rights are able to keep going, local officials say 250,000 acres has gone fallow for lack of water in Fresno County, the nation's most productive agriculture county. Statewide, the unplanted acreage is almost twice that.
Unemployment has soared into Depression-era range; it is 40% in this western Fresno County area where most everyone's job is dependent on farming. Resident laborers who for years sweated in fields to fill the nation's food baskets find themselves waiting for food handouts.
"The water's cut off," complains Robert Silva, 68, mayor of the farm community of Mendota. "Mendota is known as the cantaloupe capital of the world. Now we're the food-line capital."Three years of dry conditions is being felt across much of the nation's most populous state.
Gov. Arnold Schwarzenegger declared a water emergency in February and asked for 20% voluntary cuts in water use. The U.S. Department of Agriculture's Drought Monitor lists 44% of the state as in a "severe" drought.
In arid Southern California, cities and water districts have raised rates to encourage conservation and imposed limits on use. In Los Angeles, restaurants are banned from serving tap water unless diners ask for it. Residents can't hose down driveways or sidewalks. Lawn watering is permitted only on Mondays and Thursdays.
This drought is in line with conditions two decades ago, says Elissa Lynn, senior meteorologist for the California Department of Water Resources. But the new federal rulings to protect smelt and salmon have limited water pumping from the Sacramento and San Joaquin River Delta, a vital link between water and its users.
Here in the state's biggest farming region, fingers are pointing at the government, not nature.
"As California standards go, this is not a drought," says Bill Diedrich, a Firebaugh farmer and director of a water district. "It is the pumping restrictions."The federal restrictions arise from environmental suits brought under the Endangered Species Act that argue pulling water out of the delta harms fish. A federal judge in 2007 ordered new biological studies and restrictions on water pumped out of the delta for farmers.
A group of water authorities filed countersuits. While the issue remains unsettled, the rulings have idled the water pumps for 11 months a year, Westlands spokeswoman Sarah Woolf says. Environmental groups say water officials and farmers are overstating the problem.
"This is not a fish vs. farms problem," says Peter Gleick, president of the Pacific Institute, an environmental research group in Oakland. "I believe they're using the drought as an excuse to try and overturn these environmental decisions."Richard Howitt, professor of agriculture and resource economics at University of California-Davis, estimates that statewide about 30% of the water shortage is a result of the environmental restrictions and 70% is drought. But the impact of the regulations hits particularly hard here in the farm region, he says, because complicated water-rights laws leave Allen and his neighbors at the end of the line in water distribution.
Howitt says his studies suggest that the restrictions could put as much as 45% of irrigated acreage in the Fresno area out of production — jacking up prices for melons, broccoli, tomatoes and other produce. The area also is a big producer of almonds, pistachios, lettuce and wheat.
Potential solutions such as more dams or a canal to bypass the delta and bring water to users are pipe dreams for a state with a huge budget deficit.
Meantime, the roads along this farm area are filled with signs warning that less water means less food.
"If you like foreign oil, you'll love foreign food," says a sticker on Allen's truck.
"I wish they'd just put humans first and turn those pumps on," Allen says.
Don’t Stop Believing
Fight for CaliforniaJanuary 22, 2010
Some of you may have heard, and some may not have heard, but there is political news now in the making. Several weeks ago I decided to enter the race in the Republican primary to be the next Governor of the State of California. The reason for this is very simple. After spending this past year crisscrossing this state and traveling up and down the west coast it has become apparent that the entrenched bureaucracy in Sacramento needs new leadership. It is amazing to me that many politicians make excuses or cite legal reasons why nothing can be done to save our farmers and our economy. I cannot stand by another election and just hope for change.
So as we start 2010 I have formed a grassroots campaign staff. Currently it is comprised completely of volunteers. These are average Californians who are suffering under the oppression of the fat cat political machines that have become accustomed to destroying the wealth of our families, sending our jobs out of state, and constantly offering tax increase after tax increase to solve our problems. This nonsense must stop here and it must stop now.
It is time for California to elect one of the people for Governor. Someone who can bring together all of those individuals and businesses who continue to struggle under the weight of a overregulatory legislature that cares nothing for the people they serve, but only does the bidding of foreign interests who want to undermine our freedoms and eliminate our rights.
I’m not ignoring the problem. I’m going to solve it. By the time I’m finished California will be fully employed and prosperous again. Real estate values will increase, taxes will be lower, energy costs will go down, and the budget will be balanced. I will do this by returning to the limited government and fiscal responsibility that made us number one in education, number one in economic prosperity, and number one in leadership in this country. We will turn our water back on, restore our agricultural sector, strengthen our borders, increase the exploration and development of fossil fuels, and stay committed to our core family values. Please join my team to make California great again.
You can visit my campaign site naritelli2010.com for more details on the major issues facing our state and how I plan to solve them. It will not be easy but if we all work together we will turn this state around and return it to the greatness it once had under Ronald Reagan. We will reduce taxes and regulations across the board, bring jobs back to our state, and hold accountable those who have tried to undermine our freedoms with false science and environmental extremism.
I will not tolerate duplicity and deception in our legislature, nor in my own party. My current opponents have supported Al Gore and Barbara Boxer. They have funded the Democratic party and have not even voted in the last decade. The people of this state deserve better. The people of this state deserve a leader who will stand up for values and principles that made our country great. I ask all of you to give me a fair evaluation and choose me to be the next Governor of this great state.
God bless all of you and don’t stop believing!
Brutal use of baton jabs by University of California Berkeley Chancellor Birgeneau campus police on students protesting increases in tuition.
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