A good analysis of the infrastructure bond we will be asked to vote on in November.
An excerpt.
Schwarzenegger Gives Up His effort to reform Sacramento? Terminated.
BY SHIKHA DALMIA Tuesday, August 29, 2006 12:01 a.m. EDT
Arnold Schwarzenegger is following the wrong script. After taking over as governor in 2003, he was expected to vanquish business-as-usual politicians in Sacramento--and pull California from the brink of fiscal ruin. Instead, he has decided to put his own political future ahead of the economic survival of his beloved Golden State. How else to interpret his recent move to join ranks with his opponents in Sacramento to put a pork-heavy $37 billion bond infrastructure proposal on the November ballot?
Mr. Schwarzenegger's move officially marks the end of his grand plans to reform Sacramento, earning him kudos from many California Democrats. Sen. Don Perata, the most influential Democrat in the state Legislature, and Senate Assembly Speaker Fabian Nunez have praised Mr. Schwarzenegger's leadership and pledged to campaign with him this fall to promote the initiative. Making joint appearances with prominent Democrats while he is campaigning for re-election will help cement Mr. Schwarzenegger's image as a political moderate, something he has been trying hard to cultivate in this bluest of blue states since last year. That's when the state's public unions accused him of right-wing partisanship, and defeated the bold reform initiatives he put on the ballot to curtail their influence on state government and politics.
The real issue, however, is what this bond measure will do to California. Few doubt the need for California to invest in its crumbling infrastructure. But this is an infrastructure bond in name only. The four big-ticket items in the bond--which is two times bigger than the biggest bond in the state's history--are $2.6 billion for housing, $10.4 billion for K-12 schools and universities, $3.1 billion for levee repairs and $19.2 billion for transportation.
The housing bond is simply welfare masquerading as a capital project. A bulk of its money won't fund general infrastructure--an acceptable use of general-obligation bonds like these--but such things as cheap multifamily dwellings for low-income families, and down-payment assistance for first-time home buyers.
The education bond is equally misguided, given that 40% of the state's $94 billion general-fund revenues are already constitutionally earmarked for education. Moreover, California voters approved a total of $25 billion for school-construction bonds in 2002 and 2004 to reduce overcrowding. If there is still not enough money for new schools, it is not because of lack of state spending, but abject waste by individual districts. If anything, this handout will encourage more waste by undercutting districts' need to explore the kind of public-private partnership responsible for Inderkum High School in Sacramento being completed a month early and $2.5 million under budget. (http://www.natomas.k12.ca.us/ihsweb/ihs.htm ) In this case, a private developer built the school and district authorities used their public dollars to lease the facility from him.
