As California Gov. Gavin Newsom rolls out numerous new programs and expands existing ones, is the state biting off more than it can chew?
“Don’t bite off more than you can chew” is one of those old, but valid, aphorisms that people and institutions ignore at their peril.
Most of us know people who have taken on more debt than they can afford or make promises to friends and families that they cannot honor, with adverse human consequences.
Corporations wind up in bankruptcy court when they expand too rapidly or misread markets. That sometimes happens to governments as well, such as the three California cities that have gone bankrupt in recent years by taking on too much debt for projects and benefits that were politically attractive but financially unsustainable.
California’s state government has been on an expansionist binge of late, thanks to a torrent of unanticipated tax revenues and immense amounts of federal aid tied to the COVID-19 pandemic.
Scarcely a week passes without Gov. Gavin Newsom announcing some new program or expansion of an existing program, such as extending health coverage to more undocumented immigrants, increasing slots for pre-kindergarten care and education, and moving mentally ill homeless people into treatment and housing.
There is some financial risk in these expansions. The state is seeing a surge of revenues now, but its finances are dangerously dependent on a relative handful of wealthy taxpayers and even a mild downturn could — as we have often seen in the past — quickly lead to shortfalls.
The promises being made in the expansive services Newsom and the Legislature are launching raise expectations that could turn to dust if the economy turns sour, as it periodically does.
There’s also another aspect that could backfire even if money is not a problem — actually delivering the new services.
Alas, the state’s track record on accomplishing what it promises is not a good one. The managerial meltdowns at the Department of Motor Vehicles and the Employment Development Department attest to that syndrome, as are the state’s numerous high-technology projects that have either failed or become expensive sinkholes.
Capitol politicians have a tendency to enact high-concept “solutions” to perceived problems without fully vetting the capability of delivering or even delving into their performance after the fact.
A prime example of the syndrome is how California has dealt with — or failed to deal with — its immense homeless population, an issue that ranks very high in the public consciousness.
Countless billions of dollars have been spent on multiple approaches, but indications are that the number of people on the streets has continued to increase.
A year ago, the just-retired state auditor, Elaine Howle, issued a highly critical report on California’s efforts, saying “its approach to addressing homelessness is disjointed. At least nine state agencies administer and oversee 41 different programs that provide funding to mitigate homelessness, yet no single entity oversees the state’s efforts or is responsible for developing a statewide strategic plan.”
“As a result,” Howle told the Legislature, “the state continues to lack a comprehensive understanding of its spending to address homelessness, the specific services the programs provide, or the individuals who receive those services.”
Given that, one must wonder whether any of the new programs being rolled out will be any more successful.
How, for instance, will the state deliver more pre-kindergarten care and education if the K-12 system is already many thousands of teachers short? Will extending Medi-Cal health care coverage to more people make any difference when existing recipients already struggle to find doctors? Will there be enough professional staff to handle the mentally ill who would be forced into treatment under Newsom’s “Care Court” plan?
In short, is California continuing to bite off more than it can chew?