How California can head off the next recession and step back from partisan extremes
New Way California movement of centrist Republicans... represent a responsible approach to policy-making and governance.
By: Dan Schnur and Steve Westly, The Sacramento Bee
After almost a decade of uninterrupted growth, an unemployment rate of just over four percent and a $6 billion budget surplus, California’s economy is thriving. But there are ominous storm clouds on the horizon.
The stock market is overdue for a correction and the state tax code is dangerously over-reliant on a small number of wealthy taxpayers – not to mention more than $150 billion in underfunded pension obligations. Most importantly, this economic expansion has left far too many Californians behind.
The wizards of Silicon Valley can accomplish many things, but the remarkable economic explosion and extraordinary societal transformations they have created cannot mask the widening gap between the haves and the have-nots in our state. Tech-fueled prosperity has brought tremendous affluence to coastal enclaves in the Bay Area and Southern California, but inland California has struggled throughout this period of expansion and an economic downturn leaves huge swaths of the state exposed to job loss, budget shortfalls and spending cuts.
The state’s political polarization leaves California particularly ill-equipped to deal with these challenges. Increasingly impatient progressive Democrats have bridled under the budgetary restraint imposed by Gov. Jerry Brown over the last eight years. Increasingly irrelevant conservative Republicans are marginalized by tethering themselves to a national party that is ideologically incompatible with the state’s demographic future.
And while No Party Preference voters here have steadily increased their numbers, there is no cohesive political structure in place to give them a voice in California’s most important policy debates.
With the state’s general election campaign about to shift into high gear, there are smart and experienced truth-tellers on both sides of the partisan divide who are attempting to fashion a pro-growth agenda that can lay the groundwork for broader economic success and job creation. The “Mod Squad” of pro-business Democrats in the state Legislature, the New Way California movement of centrist Republicans, and the fiscal watchdogs of Govern for California all represent a responsible approach to policy-making and governance.
The Independent Voter Project has long fought to increase voter awareness and participation. Most recently, a statewide group of civic leaders known as the Economic Mobility Collaborative has laid out an agenda for economic opportunity and mobility.
Groups like these demonstrate that there is no shortage of sensible ideas to be found in the space between the ideological 40-yard lines; the challenge is to force the debate out of the political end zones and closer to midfield.
The first step is create a tax system with a broader base and therefore less volatility. But we also need to focus our spending on the areas that provide the greater return on investment.The partisan extremes represented by Donald Trump and Bernie Sanders will not solve the state’s long-term challenges. The next governor and Legislature must fashion common sense solutions that might not be the first option of either liberal Democrats or conservative Republicans, but rather a cooperative effort that institutes wise thinking from both sides of the partisan divide.
To do this, we should:
Redirect money to targeted pre-kindergarten education and community colleges that serve in-need communities.
Create a K-12 curriculum for the 21st century so we’re training every Californian to be job ready.
Reduce our pension exposure so we’re not leaving a mountain of debt for our kids.
Invest in housing and infrastructure for the future that will put people to work and help speed the flow of goods and services.
The next recession is coming. Ideological extremism won’t prepare us for these challenges, but pragmatic solutions and smart investing will.