Are Furloughs Penny Wise But Pound Foolish ?
As many of my readers know I am an attorney and given the condition of the economy a large amount of my practice is bankruptcy. While my clients come from a variety of places I have recently had a number of state of California employees come in to my office. They are coming to me because due to the furloughs imposed by the state they are looking at 15% pay cuts and as you might imagine this is difficult for them to handle financially.
As often happens in client meetings our discussions range from the business at hand to more general conversational subjects. Obviously with the state employees the topic often turns to the furloughs and the fact that they feel like the budget is being balanced on their backs. The common refrain from those who support the furloughs is that while they are unfortunate the state has few options when the state doesn’t have any money to pay them with.
However in my conversations with various clients I have come to learn something very interesting. Many of the agencies that are facing furloughs are actually money generators. That is to say that they produce more money than they spend and are a net positive to the state budget. But with these cuts that is becoming less and less true.
An example might be found in something like the State Parks system. One of the big income generators for the state is tourism (both from those who live here and from those who come here). The state park system in California is one of the best in the country and produces a net profit to the treasury. But with the furloughs many parks are being closed or on partial schedules and this reduces tourism (especially from those out of state).
Another example is with programs that recieve income from the federal government. In many cases there the state is losing money because there are literally not enough people to fill out the paperwork in order to get the money.
Or when it comes to vital services like the state prisons, we have people working overtime to keep staff in place and this ends up costing more money than it would to just have the regular schedules.
I could tell more specific stories but I want to be cvareful about attorney client privilege issues and while the topics here really don’t fall in to that category I prefer to respect their privacy. Though I’m sure many state employees could chime in with stories of their own.
Obviously there is room for some cutbacks in government spending and it is certainly important to be thrifty when you are dealing with major deficits. At the same time I think that if we can make exceptions for vital services (the prisons are under some budget cuts but not as much as other agencies) then you could also consider the cost/benefit of cuts in other departments.
Share This
Well, I'm against big government, but I look at it completely different that the current argument.
We have the federal government which is the most important, most useful and most necessary. Then we have fifty state governments that rival or surpass other nation’s governments, costing us far to much to operate. After that we have thousands of county and metropolitan governments that cost yet again.
We don’t need fifty governments. All we need is four or five provincial governments with four or five regional governments within those to replace counties and city governments. City governments should be more like administrative bodies without their own law enforcement, elections, or stupid local political rivalries that lead to inept leadership, etc..
Streamlining government should mean actually reducing the number of governments rather than having all these governments in place with little money left over to do anything useful.
It probably makes financial sense to lay off more “money-losing” workers than money-making, but from a practical standpoint it would be an impossible task when dealing with the unions who would portray it as preferential treatment for one group of employees. It's not perfect but it's probably the best California can do under it's dysfunctional system.
…and if you factor in unemployment benefits to those on furlough, the state(s) aren't saving nearly as much as they'd like us to believe.
A furlough is an alternative to a pay reduction. Both are unsurprising and in order during these hard times. (It's a separate issue whether or not it's being done just as another way to make quarterly numbers so that executives can get bonuses. This is not the case in California, which is wrecking itself through bad policies, just as New York City bankrupted itself by bad policy back in the 1970s.)
* * *
“We don’t need fifty governments. All we need is four or five provincial governments with four or five regional governments within those to replace counties and city governments.”
It sounds good in theory, but in reality makes wiser people wary. The last thing we want is an even bigger, more centralized federal (“national”) government (which is the real motive behind having federal health care and ignoring the role of state governments almost completely). The theory certainly is appealing, not only for reducing the number of governments but for standardizing, as well as centralizing, so much. (“If it succeeds with a single currency, why not …?”) In fact, the states (which have been reduced by so many Americans who are ignorant or contemptuous of constitutional federalism, not just the Constitution to mere provinces or administrative districts already) could be abolished completely and have simply a single central government and administration carried out in districts corresponding either to counties, or Congressional districts (which would have their representation in the House of Representatives — it's a side issue what to do with the Senate in the case of no longer having states).
The word “region” acquires a clear, rather than vague or flexible, sense here (as it often does when discussing American phenomena) — in this case it would correspond to the regions of the USA with which we're familiar — Northeast, South[east], Midwest, and West. (This could become more elaborate if desired, but would still follow this arrangement fundamentally.)
Now, something some liberals in particular would like, and those who hate the Senate and how undemocratic it is for states to be peers of each other with varying population (those people largely being liberals, once again) — an intriguing alternative I've thought of (to give nightmares to those who abhor the massive hordes of ignorant and morally low Dem voters, often in highly populated areas) is for states to be grouped in blocks (“blocs,” i.e., groups), with “mega-states” (the high-population states) being placed in superior roles relative to the other states in their respective blocks, which would host much of the role of governing “delegated” by the “national” government and have much government as well as direction and control over subordinate states seated there. Imagine, for example, California being the principal sub-national seat of government for the Far West states, Illinois controlling much if not all of the Midwest's governance, Massachusetts controlling all of New England, New York the Mid-Atlantic, Florida controlling the South[east] or much of it, and so on. A conventional regional system would just be something of a basis for a new federal legislative body (probably replacing the Senate), but instead, this “mega-state-based” hierarchical government system (using the states and implementing superior and inferior levels of authority among them) is a related, though twisted, potentially-nightmarish cousin.
“it would be an impossible task when dealing with the unions”
Aside from fighting everything beyond any reasonable concept of limits, there's also seniority to consider.
” All we need is four or five provincial governments with four or five regional governments within those to replace counties and city governments.”
Or as I described, some states could take superior (or supervisory) roles, and the others, who are in the superior states' “spheres of interest,” inferior roles.
Revising everything does lead to consideration again about true redesign and reconceptualization of just what the states are supposed to be. How (much more closely) would they be more alike in fractions of the total US population, where would the boundaries be (with emphasis on natural boundaries, not just political traditions based on arbitrary lines drawn on maps), and would they be (logically) centered about major metro areas (which makes a great deal of sense, as does natural boundaries)? Note that these revised states coupled with consolidation and redesign of counties (making them like reforms proposed for Congressional districts, with equal-population being sought if possible along logical boundaries) would achieve something very much if not ideally conforming to a two-tier scheme below the central government that Father Time and no doubt many others reflexively imagine.
Of course the furloughs are “penny wise and pound foolish”, but I don't think that necessarily makes them the wrong thing to do under the circumstances. I kind of think of it like using credit cards to buy groceries when you're broke. Will it come back to bite you later? Yep. But what are your other options?