Freedom Line Blog

Increasingly, Californians across nearly all age, political and demographic groups oppose organized labor, according to a new poll.

Overall, 45 percent of respondents said labor unions do “more harm than good,” while 40 percent said they do “more good than harm.”

Interestingly, it doesn’t matter whether it’s private or public employee unions. People dislike both equally.

Even Democrats are souring on one of their party’s most powerful constituencies. The independent Field Poll found that “30 percent of registered Democrats now say unions do more harm than good, up from 21 percent in the 2011 survey.”

Potential reasons include the ongoing pension and retirement benefits funding crises causing many municipalities to cut other services like public safety. An ongoing strike by public transit workers is stoking discontent in the Bay Area, heretofore a pro-union fortress.

It’s probably too early to tell how the slide in support for unions will impact California’s politics. One thing is certain, though. By overplaying their hand, unions have earned the ire of a populace predisposed to support them. If disapproval of unions turns into a clear majority, the state that touched off a wave of property tax reform in the 1970’s may become the impetus for weakening unions in the next decade.

Stay tuned.

California’s Obamacare-aligned health insurance exchange will not bail out President Barack Obama.

Data released by Covered California, the state’s exchange, explains why.

“People between the ages of 45 and 64 have enrolled in California’s health exchange at a much higher rate than their overall portion of the state’s total population, while younger adults’ enrollment levels essentially track their overall population,” reports CNBC.

“If the trend holds up, it could mean that insurance plans are overweighted with older customers, and underweighted with younger, presumably healthier people. Since their premiums are much needed to offset the cost of benefits paid out to sicker individuals, that could lead to higher premium prices in 2015.”

In other words, Covered California – like any other Obamacare exchange – can’t afford President Obama’s costly ‘fix’ that would allow young and healthy people to keep their pre-Obamacare insurance plans and stay out of the post-Obamacare risk pools. As I explain in my column this week, doing so would lead to the dreaded ‘death spiral’ that will doom the Obamacare exchanges.

There’s no other way to say it. California’s refusal to go along with Obamacare’s latest ‘fix’ is a huge blow to President Obama. So far, the Golden State is home to the most Obamacare-related enrollments, so if it’s afraid that adopting Obama’s enforcement delay will put its fiscal sustainability in jeopardy, it’s hard to see how any other state that’s serious about the issue will disagree.

Liberalism’s word police are at it again.

Student government representatives at UCLA and UC Berkeley voted recently to ban use of the term “illegal immigrant” in on-campus “academic writing, or in communications between faculty, students and staff,” reports the University Herald.

The reasons given for the prohibition allege that saying the word ‘illegal’ is ‘racially charged’ and ‘dehumanizing’ to the people it describes. Better, the students argue, to use labels like ‘undocumented immigrants,’ ‘immigrants without papers,’ and ‘immigrants seeking status.’

This line of argument is consistent with the old trope that “no person is illegal.” Which, of course, misses the point and confuses the issue. The term illegal immigrant does not refer to a person’s humanity, but rather to his or her legal status.

Because Congress has the power under Article I, Section 8 of the U.S. Constitution “To establish a uniform rule of naturalization,” it has the power to determine what qualifies as legal immigration. Foreign nationals who violate Congress’ uniform rules are, by definition and common sense, illegal immigrants. The reason illegal immigrants are “undocumented” and “without papers” is because they are “seeking [legal] status” without wanting to undergo the legal process.

No serious person disputes this. What the UC students really mean to convey with their vote is that the very idea of distinguishing between legal and illegal immigration is itself racially charged and dehumanizing. Having rejected the idea that American citizenship requires accepting certain fundamental beliefs, these enlightened collegians would extend the blessings of liberty without requiring a reciprocal commitment to respect the laws and mores of the community that make these blessings possible.

In other words: All of the benefits, none of the responsibilities.

Sounds like sophomoric reasoning to me…

Disfiguring the truth seems to be one of the primary skill sets at Covered California, the state’s Obamacare-aligned insurance exchange.

When the online platform launched on Tuesday, it erroneously stated receiving 5 million hits. A day later, that number was revised down to 645,000.

“Someone misspoke and thought it was indeed 5 million hits. That was incorrect,” said a Covered California spokesman.

This isn’t the first time the Golden State’s Obamacare exchange has been caught misstating the truth.

Earlier this year it misleadingly announced that individual insurance premiums in 2014 would be lower than they are today. The news was quickly circulated as a refutation of the criticism that Obamacare’s heightened coverage requirements will necessarily result in more expensive plans.

But Covered California’s own press release showed that the exchange was comparing apples to oranges. Instead of comparing individual insurance rates from 2013 to 2014, it compared small business rates from 2013 to individual rates in 2014. This sleight-of-hand had the effect of creating a more favorable (i.e. higher) baseline from which to compare Obamacare’s higher individual rates.

In other words, it was a distortion meant to persuade people that Obamacare does the opposite of what it actually did.

And now Covered California is issuing “incorrect” opening day numbers that artificially inflate its popularity.

Call me a cynic, but I think I see a pattern here…

If you think President Barack Obama has a difficult job delivering an on-the-fly speech about the situation in Syria, consider what his former Secretary of Homeland Security Janet Napolitano is about to step into.

In language that’s better suited for an updated version of the movie PCU, a gaggle of liberal student groups in the University of California system sent a letter to Napolitano, who became UC’s first female president upon leaving the Obama administration.

After introducing themselves as “student leaders in the statewide multicultural progressive coalition that represents students who are underrepresented and marginalized within the UC System,” the petitioners “demand that you [Napolitano] implement the following across the UC system.”

These include “making the system a ‘sanctuary’ for illegal immigrants, barring the use of system funds or resources going to help Immigration and Customs Enforcement (which Napolitano oversaw in her previous job), impose mandatory sensitivity training on campus police and prohibit police from interfering with student demonstrations,” according to Fox News.

The letter, posted on Sunday, demands a meeting with Napolitano on Wednesday. For her trouble, the students promise to “do our best to cooperate with you in setting this up so all parties can have a productive conversation.”

Funny as it is to see a liberal like Napolitano have to take such people and demands seriously, it is still ridiculous that a highly compensated public official like her has to spend precious time and resources stoking the entitlement mentality of perennially aggrieved people.

Then again, that’s part of the job description when leading many modern higher education bureaucracies.

Democratic strongholds like California, Vermont and New York have been quick to use ObamaCare’s state-based insurance exchanges as an excuse to register voters.

State officials are claiming that 1993 National Voter Registration Act (aka the “Motor Voter Act”) requires combining election prospects with health insurance, but the reality is much murkier.

To start, ObamaCare is silent on voter registration. “The health care law spans 974 pages and regulates nearly one-fifth of our economy,” Rep. Charles Boustany (R-LA) wrote in a letter to the Department of Health and Human Services, “yet nowhere in the law is voter registration mentioned.”

Then there’s the Motor Voter Act itself.

As written, the law “requires states to offer voter registration at government offices, most commonly departments of motor vehicles,” explains the Detroit Free Press. “With the exchanges, which are in some ways a new kind of government office, some are questioning whether the law applies to them.”

But unlike a state’s motor vehicles department, not all ObamaCare exchanges are standard government agencies. The paper continues, “In some states, the exchange will be a nonprofit; in others it will be part of the state’s health or human services agency. And in many Republican-controlled states, the federal government will operate the exchanges.”

The lack of uniformity is already leading to differing interpretations about whether the Motor Voter Act applies, which in turn is spawning lawsuits.

With this much uncertainty leading to costly court battles, states and their taxpayers would be much better served leaving the question whether Motor Voter applies to ObamaCare for academics to debate.

The alternative is an expensive and unnecessary distraction.

With just eight weeks to go until ObamaCare’s October 1 enrollment, the Health and Human Services department is scrambling to meet the deadline.

Its first order of business: A log-in portal where users can create a personal account.

In a few clicks you can get a sense of the kind of information you’ll be sharing via your account: family size, personal income, health history, age, gender and employment status.

Yes, some level of government likely has access to most if not all of this information, but it is ObamaCare’s user account that will, for the first time, house all of it in one place.

It will then be the Federal Data Hub’s job to share this information with the applicable state-based insurance exchange, and check your entries against another federal database to ensure accuracy.

As I’ve written before, the two federal databases will attract attention from hackers and identity thieves.

The ObamaCare user account creates a third inviting target.

Enjoy your privacy, while it lasts.

The Los Angeles Time is reporting that Janet Napolitano is resigning as Secretary of Homeland Security to become the president of the 10-campus University of California system.

Beyond the flashy headlines – first female to lead UC in its 145 year history, new compensation more than triple her DHS salary – Napolitano’s appointment heralds a new direction for higher education administration that doesn’t bode well for taxpayers: The rise of the politician-turned-university president.

The reason is simple. Most top-tier research universities are addicted to federal research spending. With Napolitano, UC leaders see a soon-to-be-former Cabinet member able to lobby effectively for increased cash flow.

“UC officials believe that her Cabinet experiences…will help UC administer its federal energy and nuclear weapons labs and aid its federally funded research in medicine and other areas,” according to the Times.

Contrast this with former Indiana Governor Mitch Daniels’ presidency at Purdue – where the one-time private industry executive is getting large individual and corporate donations to fund the public university’s research expansion – and higher education may become the next arena where conservatives and liberals chart different paths on how to pay for education.

As usual, Troy puts his finger on the essential issue in an otherwise complicated matter. Writing with John Yoo for City Journal recently our Senior Fellow explains how the Supreme Court’s ruling in California’s Prop. 8 case – that the official proponents of the traditional marriage law have no standing to defend it when state officials refuse – will have a chilling effect on direct democracy, and with it, dash any hope of checking radical leftwing politicians.

“Regardless of how one feels about gay marriage as a policy matter, the Court’s ruling creates a chilling legal precedent for the future of direct democracy—that is, passing laws by popular vote. The opinion dictates that any law that an electorate passes can be invalidated if it is challenged in court and the state’s constitutional officers refuse to defend it. This amounts to an executive-branch veto for laws approved by an electoral majority. Direct democracy is far from perfect; it often oversimplifies issues and insulates voters from the consequences of their policy choices. At its best, however, it allows popular majorities to tighten the reins on out-of-touch politicians. The Prop. 8 ruling loosens those reins.
…
“All conscientious Californians should be disturbed by the sweeping implications of the Prop. 8 ruling, but it augurs especially poorly for the state’s shrinking cadre of conservatives. With every statewide elected office and both houses of the state legislature controlled by Democrats, only the initiative process gives California conservatives a real chance to have their voices heard. As a result of the Court’s ruling, California liberals now have a mechanism by which to frustrate this last meaningful check on their dominance. The state’s future will only grow dimmer, and the Supreme Court will deserve the blame.”

The entire article can be read here.

Regular readers know that I — partially out of loyalty to my home state, partially because of a masochistic streak — spend a lot of time writing about the public policy failings of California, a state that has weaponized liberalism and turned it on itself. Despite its massive size, enormous population, and national influence, serious analysis of California’s public policy failings was in short supply until just a few years ago. One of the biggest factors in changing that trend has been the Manhattan Institute, which launched a City Journal California website (where I occasionally contribute) and regularly featured pieces on California in the quarterly print edition of City Journal.

After a few years of work, they’ve now anthologized some of the best material to provide a comprehensive overview of what ails the state and what can be done to fix it. It’s available in the form of the new book The Beholden State: California’s Lost Promise and How to Recapture It. The book features contributions from the likes of Victor Davis Hanson, Andrew Klavan, Art Laffer, Steven Malanga, and William Voegeli, in addition to several others. Yours truly is even responsible for a couple of chapters.

I recommend it for all despondent residents of the Golden State, all Americans who want to learn how to keep their states from going down California’s road to decline, and every resident of Texas who likes a good laugh.

Texas Republican Governor Rick Perry is once again visiting Democratic strongholds in an attempt to lure businesses to relocate to the Lone Star State.

Perry is set to meet with business groups in New York and Connecticut, reports National Public Radio. Previously, Perry extolled his state’s low-tax, light-regulation approach in California and Illinois.

But Perry’s initiative is more than just a series of speeches and photo-ops. His moves are coordinated with the work of TexasOne, a coalition of chambers of commerce and corporations funding a $1 million advertising campaign in the targeted states.

YouTube ads like “Texas is Calling” tout the state’s nine consecutive years ranked #1 for business, hosting the world’s largest medical center and welcoming 1,400 new residents a day.

With states like California, Illinois, New York and Connecticut ranking near the bottom in business-friendly taxes and regulations, it’s no wonder Perry sees an opportunity to let wealth creators in those states know there is an alternative.

Despite initial reports that California’s ObamaCare health insurance exchange will offer plans that are cheaper than currently available, a closer look at the data shows that the state specializing in concocting fake budgets also lied about the supposed cost savings.

Initially, Covered California, the state’s ObamaCare-ready exchange, announced that insurance rates would drop up to “29 percent below the 2013 average,” prompting many of the health law’s defenders to claim victory over critics who estimate double-digit increases.

But the bloom fell off the rose fast. In order to make the new prices look as favorable as possible, Covered California didn’t compare current individual insurance rates to future individual rates. Instead, it compared current small business rates to future individual rates, and reported the “savings” of 29 percent.

Many conservative analysts caught the switch, and deconstructed the ploy. Avik Roy compared current individual rates in California to future individual rates under ObamaCare and surprise, surprise, confirmed that rates will increase between 64 – 146 percent.

Of course, much of the damage from the false information has already been done. I was in a meeting hours after the rates were announced and was greeted by a liberal friend smiling and saying something along the lines of, “Well, how about that; it looks like ObamaCare is better than your side thought all along. Have you seen the California numbers yet?”

At the time I’d only heard the summaries, none of which drew attention to the obvious apples-and-oranges comparison by Covered California. A week later, none of the liberal cheerleaders for the California miracle are going out of their way to correct the record.

At least now we know the truth. Too bad the left and their friends in the media don’t seem to be interested.

How big is a “gap” in coverage when it affects 840,000 people?

The Los Angeles Times says that California is racing to pass a “bridge” program into law that helps individuals and families likely to be caught between qualifying for Medi-Cal (the state’s version of Medicaid), and ObamaCare’s new state-based health insurance exchange.

In California, residents earning up to 138% of the federal poverty level, or about $15,000 a year, will be eligible for Medi-Cal next year. Individuals earning up to 400% of the federal poverty level, or about $46,000, will be eligible for subsidies through the exchange, known as Covered California.

The Covered California board approved a plan in March to help patients expected to jump between the two. The “bridge plan” would enable patients now on Medi-Cal managed care whose incomes rise to continue to stay with their health plan once they move to the exchange.

The program, which still needs federal approval and state legislation to take effect, could serve as many as 840,000 people next year. The plan should streamline the process, keep out-of-pocket premiums low and make it easier for people to keep their providers, said David Panush, external affairs director with Covered California. “It is better for their quality of care, it is better for continuity of care,” he said.

While it’s refreshing to see California taking steps to protect people from being penalized for working more, what the article doesn’t mention is how related government policies are putting the squeeze on the state’s working poor.

California’s anti-business climate – coupled with ObamaCare’s perverse incentive structure that makes it more affordable for businesses to cut hours rather than pay hefty premium increases for employee’s health insurance – are underreported tax increases on the working poor.

By diminishing the number and quality of jobs available to people at the bottom of the employment ladder, certain public policies make it exceedingly difficult for people to work their up into a better standard of living.

Because of this, one way to think of the constant tinkering and enlargement of public benefits is as a way to compensate the working poor for taking away their access to an abundance of jobs where they can get the experience and skills needed to move upward an onward.

Under the current regime, a “bridge” program between Medi-Cal and Covered California is the least state policymakers can do. Still, those entangled in the state’s safety net deserve better.

Ten California public school teachers are suing both the National Education Association (NEA), and its state affiliate, the California Teachers Association (CTA), to block a mandatory $1,000 annual contribution to the union – even though none of the teachers are members of the union.

California’s “fair share” and “agency shop” laws allow CTA, the state’s dominant teachers union, to extract involuntary contributions to fund its activities since non-members are deemed to benefit from the union’s collective bargaining agreements, reports Paul Bedard of the Washington Examiner.

The teachers’ lawsuit “claims that NEA and CTA dues fund a Democratic political agenda, not just collective bargaining.” And since the teachers suing don’t agree with that agenda, their coerced dues amount to compelled speech.

In other words, California’s draconian employment tax on non-CTA teachers could be unconstitutional, according to the U.S. Supreme Court’s reasoning in Knox v. Service Employees International Union (2012).

Such a ruling could help weaken the CTA’s stranglehold on California politics, and stop its pilfering of non-members’ paychecks.

Stay tuned.

This won’t make California Democratic Governor Jerry Brown happy.

On the same day a state court blessed a settlement between Brown’s high-speed rail authority and Central Valley farmers that clears the way to begin construction on a Los Angeles-to-San Francisco bullet train, the federal Surface Transportation Board announced it is claiming jurisdiction over the multi-billion dollar project, according to the San Jose Mercury News.

California officials have filed for an exemption, but that might not be an easy sell since the state has angered environmental activists by seeking exemptions from several state regulations already. I wouldn’t be surprised if the assertion of jurisdiction by STB is the result of some closed door lobbying at the federal level to slow down Brown & Co.’s runaway rail project.

Either way, California taxpayers may get an unexpected ally if STB maintains a presence. Originally approved by voters in 2008 with an advertised price tag of $10 billion, the proposed rail line is now estimated to cost at least $68 billion. If the project is made to comply with the federal versions of state regulations California has exempted itself from, the cost of the program will climb higher still.

Further cost overruns and delays could become California’s version of ObamaCare – an idea with a cost structure too big to work that gives partisans on both sides something to hate.

If conservatives want to make headway in Golden State politics, cheering on the train wreck that is Governor Brown’s high-speed rail boondoggle could be one of the ways to start.

An investigative report from the Orange County Register deserves to be read in its entirety, but here’s my executive summary.

Hundreds of schools in California enlisted the services of a bank to underwrite school construction bonds, known on Wall Street as “capital appreciation” bonds.  The key attraction: no payments on principal or interest for 35 years.

Of course, that kind of delay isn’t free.  One school district in Orange County is estimated to owe $13 for every $1 borrowed when the bills come due.  This means that for one $22 million bond issue in 2011, the Placentia-Yorba Linda school district will eventually owe $280 million – 13 times the original amount.

It gets worse.  In 2008, thanks to arguably illegal politicking by the bank underwriter, district voters approved up to $200 million in bond issuances.  But while not all of the total are capital appreciation bonds, those that are could very well bankrupt the district for a generation or more.

The failures on display here are all too familiar.  Public officials opting to mortgage the future to look like a hero in the present saddle taxpayers with huge financial burdens.  Financial whizzes with no ethical scruples abuse the system for big profits.  And money wasted on concrete eye-candy – a football stadium and 600 seat performing arts center – while funding for classroom instruction gets reduced.

While there is no silver lining to the Register piece, it’s worth reading as a reminder of how much American government at all levels needs a deep renewal of ethics, thrift, and a commitment to the common good.

The Daily Caller spotlights a landmark decision in the Los Angeles Unified School District this week:

The Los Angeles Board of Education signed off on a parent-led plan to turn a failing public school over to a private charter company this week — the city’s first use of the controversial “parent trigger” law.

The 5-1 vote granted parents in downtown Los Angeles final approval to convert 24th Street Elementary School into a charter school. The new school will be better equipped to handle demographic changes to the area, parents said.

Unsurprisingly, and despite the fact that the parents pushing for the change met for over a year to put together a charter proposal, the United Teachers of Los Angeles, affiliated with the deplorable California Teachers Association, has been opposing the parents’ move by essentially calling the group insane.

In relevant part, the union’s statement declares:

We believe parents do not want a private charger corporation to take over 24^th Street Elementary, which is exactly what is happening at Desert Trails Elementary School in Adelanto as a result of the Parent Trigger.

So, parents who have deliberated for over a year about converting their public school into a charter school, used the state’s parent trigger law to do it, have now been approved for the change, and will get a privately run charter school don’t, in fact, want any of this to happen?

It’s hard to know which is more offensive – saying that adults who navigate a rigorous legal process don’t understand the consequences of their actions, or that the union who released this statement is in a superior position to judge what’s best for students in a failing school.

Thanks to the parent trigger, California parents of kids in failing public schools now have a mechanism for saving their child’s education – and their future.

Conservatives looking for ways to grow the movement’s electoral base should pay close attention to this development.  If championed, it could become a key reason why traditionally liberal voters start supporting more conservative candidates.

It’s an interesting time to follow California politics.

Last month, Democratic Governor Jerry Brown announced that, thanks to the voter-approved tax hikes from last November, the state looks poised reap budget surpluses for the first time in years.

But instead of using those projections as an excuse to restore funding for programs pared back by budget cuts, Brown is promising to set aside the money in a rainy day fund.

Moody’s and S&P rewarded Brown’s announcement by upgrading California’s credit rating.

Now Brown faces an even bigger test.

There’s an estimated 15.4 billion barrels of oil in California’s Monterey Shale formation, or four times as much as North Dakota’s Bakken Shale reserves.  Another way to put it is that California is home to two-thirds of America’s projected shale oil reserves.  Opening it up would be a game changer for the nation’s oil security and California’s economy.

But here’s the rub, according to Walter Russell Mead:

The intrigues in this drama are many. Does California’s Democratic Party come down on the side of low income Californians, who desperately need the jobs and state services new oil extraction will fund? Or does it come down on the side of a green lobby that is heavily backed by some of the wealthiest people in the state? To what extent does the wealthy coastal elite control the future of the inland poor in California? Can the GOP use the issue as a wedge to rebuild its credibility in a state it once dominated? Will black gold bail out big blue California?

Bring lots of popcorn. This is going to be a terrific show.

Tony Lee over at Breitbart.com highlights some interesting divergences between the Republican and Democratic caucuses in the U.S. House of Representatives:

Democratic National Committee Chairwoman Debbie Wasserman Schultz (D-FL) on Wednesday said to “take a good look when the House convenes after this next Congress is sworn in” to see that the Republican party has gotten “white and more male,” while Democrats are “majority minority and female.”

But a University of Minnesota study found that when the 113th Congress convenes, a whopping 29.4% (59 of 201) of Democrats in the House will hail from California (38 members) and New  York (21 members).

As any number of post-election analyses has shown, liberals have been very successful at defining politics in terms of gender and ethnic identities.  What is striking about the Minnesota study is how much those identities – and the ideology of government activism that supports them – are anchored in America’s two most populous coastal states.

Remember this reality the next time you hear an MSNBC talking head decry the Southern hegemony in the GOP.  As always, the parties are defined by powerbases that offer a glimpse into what each group’s policy goals might look like if the candidates promoting them are successful at the ballot box.

The Democratic Party is becoming increasingly defined by high-tax, high-spending states like California and New York.  Like European socialism, that model isn’t sustainable.  It remains to be seen if a Southern-oriented conservative can articulate not only the reasons to reject a statist future, but also the rational benefits of limited government.

Take it from this Californian — the Golden State is no longer the destination du jour for starry-eyed dreamers looking to turn ambition into fortune. The rest of the west, however, looks pretty good. From the Daily Caller:

If you are looking to start a new business, Wyoming might be a place to consider moving. According to the Tax Foundation’s annual State Business Tax Climate report, Wyoming ranks first among the fifty states for most business-friendly tax code.

Behind Wyoming are South Dakota, Nevada, Alaska, and Florida. Washington, New Hampshire, Montana, Texas and Utah rank in the top ten.

For those of you keeping score at home, that’s eight of the top ten states for business located in the West. And if a pro-energy candidate wins the White House, expect the numbers from those states to become even more impressive, given the tremendous amount of resources in the region.

California has chosen gilded decline and reaped economic disaster. The rest of the west, however, has chosen freedom. And prosperity is following closely behind.