When I decided to go to American to receive my master’s in journalism, I assumed that much of my time would be spent covering national politics. Little did I know that despite being 3,000 miles away from my home state, California politics would never be very far away.
For my Reporting on Public Affairs course, I received the opportunity to attend an event at the American Enterprise Institute, a conservative think tank here in D.C. where Steve Poizner, California’s current Insurance Commissioner and a Republican candidate for governor, gave a speech outlining his plan for the state. I must admit that I was a bit surprised that there was so much focus on a gubernatorial race that was still a year away.
Here is the news story I produced after that event:
West meets East
California Insurance Commissioner and Republican gubernatorial candidate Steve Poizner called Wednesday for lower taxes and spending cuts to turn around his state’s budget woes.
“The only was to repair California’s broken economy is to make California’s tax structure competitive again,” he told the crowd of 60 people at the American Enterprise Institute.
California’s budget problems have forced steep cuts in essential services and even forced public officials to issue IOUs to contractors and tax payers to avoid running out of money to keep the state running.
Both Poizner and Henry Olsen, vice president and director of the National Research Institute at the AEI summarized the challenges that have contributed to the economic crises plaguing the state. Olsen cited statistics showing that “hundreds of thousands native Californians leave the state” while Poizner cited advertisements being run in California newspapers trying to entice businesses to cross the border into Nevada.
In order to make California more business friendly and encourage them to “start and grow” in the state, Poizner is running on a plan in which he cuts income tax rates, the state sales tax and the corporation tax rate by 10 percent while also cutting the capital gains tax by 50 percent.
While creating a business-friendly atmosphere in California appeared to be his priority, the California Republican expressed his desire to improve the public education system saying, “I don’t see how you can fix California’s economy until you repair California’s broken public education system.”
The insurance commissioner, who spent a year volunteering as a teacher in a San Jose high school described the decline of the state’s schools from being the best in the nation to today, where “about 50 percent of the fourth graders . . . in the state of California cannot pass basic reading proficiency tests.”
Poizner placed the blame solely on the shoulders of the state’s politicians, who he claimed took control away at the local level and enforced mandates “uniformly to all 5,000 schools at the same time.
In addition to cutting taxes, another key part of the gubernatorial candidate’s plan is a decrease in government spending. Poizner used a chart to illustrate how quickly government spending in California has grown – his data showed that it has doubled over the past 10 years, outstripping even federal spending. Olsen said the state’s budget deficit “exceeds in its size, the size of most other state budgets in total.”
When talking about cutting government spending, Poizner said he is not “a big fan of taking out a big axe and starting to slice;” instead favoring “a top-down review of every dollar, every person; you need to take programs that really don’t help anybody any more and just stop doing them completely.”
Although Schwarzenegger and the state legislators have been attempting to solve the budget deficits with steep cuts in areas like education and health care, the governor, in a speech in March explained why he had to go against his promise not to raise taxes.
“If we had tried to solve the deficit by spending cuts alone, we would’ve had to close our entire state university system, cut off all welfare assistance and shut down all mental health services,” the governor said.
According to the Los Angeles Times’ Evan Halper, much of California’s spending goes towards programs like Medi-Cal, which provides health care for low-income residents and receives more than $14 billion annually or programs aimed at providing services for the disabled, which receive $2.4 billion per year.
