Buchanan: Undocumented immigrants are “bankrupting” California

Buchanan baselessly claims that undocumented immigrants are “bankrupting the state of California.” On the April 28 edition of MSNBC's Morning Joe, Buchanan stated, “We've got 12 to 20 million illegals in the country, they're bankrupting the state of California because they're very poor and unskilled.”

It's a “myth” that undocumented immigrants are to blame for CA fiscal crisis

Schwarzenegger: “It is a 'myth' ” undocumented immigrants are to blame; such immigrants serve as an “easy scapegoat” for CA economic crisis. In a June 8, 2009, article, The Sacramento Bee reported: “In response to dozens of questions from readers who say the state ought to wipe out the deficit by eliminating services for illegal immigrants, the governor said it is a 'myth' that those immigrants are to blame.” The Bee reported that Schwarzenegger “said the cost of services to illegal immigrants ... is a 'small percentage' of the deficit California faces.” From the Bee article:

In response to dozens of questions from readers who say the state ought to wipe out the deficit by eliminating services for illegal immigrants, the governor said it is a “myth” that those immigrants are to blame.

He said the cost of services to illegal immigrants, which has been estimated at $4 billion to $5 billion annually, is a “small percentage” of the deficit California faces.

“Yes, it is something that ought to be dealt with, but the fact of the matter is, I think it's an easy scapegoat for people to point the finger and say, 'Our budget is out of whack because of illegal immigrants.' ”

“It's not,” he added. “Our budget is out of whack because we have self-inflicted wounds that the Legislature and this state has never really sat down and had the will to go and make the necessary changes that have to be made.”

Economist Stephen Levy: “The fact that unauthorized immigrants make up a growing share of California's low-income population does not explain why California has perpetual budget struggles while other states do better.” In a 2008 report, Stephen Levy, director and senior economist for the Center for Continuing Study of the California Economy, wrote of “One Confusion About Unauthorized Immigrants [That] Needs to be Addressed” and stated: “There is a widely heard perception (at least on talk radio and in the blogs) that California's serious budget problems would disappear if there were no 'illegal immigrants'. I don't hear this from elected leaders in California, which I take as a positive sign in a state where budget disagreements run deep between the two major political parties and blaming immigrants might be considered an easy sell in some political circles.” Levy further wrote:

One point is easy to understand and absolutely true. Low-income families usually do not pay enough in state and local taxes to cover the cost of the public services that their families use. It is also true that unauthorized immigrant families have incomes that are well below the state average.

The missing “logic link” that leads to confusion is that California does not have more low-income and low taxpaying families because the state is home to unauthorized immigrants. It is true that unauthorized immigrants probably account for a growing share of the state's low-income families but that does not mean that the total share of families with low-wage jobs is higher than elsewhere.

[...]

California has the same share of low-wage jobs and the same share of people in poverty as the nation. The fact that unauthorized immigrants make up a growing share of California's low-income population does not explain why California has perpetual budget struggles while other states do better.

CBO: State and local spending on undocumented workers is a small percentage of total amount of spending to provide the same services to residents. In a December 2008 report, the Congressional Budget Office (CBO) stated that "[t]he amount that state and local governments spend on services for unauthorized immigrants represents a small percentage of the total amount spent by those governments to provide such services to residents in their jurisdictions." CBO further reported: “Spending for unauthorized immigrants in certain jurisdictions in California was higher but still represented less than 10 percent of total spending for those services.” From the CBO report:

The amount that state and local governments spend on services for unauthorized immigrants represents a small percentage of the total amount spent by those governments to provide such services to residents in their jurisdictions. The estimates that CBO reviewed measured costs associated with providing services to unauthorized immigrants that ranged from a few million dollars in states with small unauthorized populations to tens of billions of dollars in California (currently the state with the largest population of unauthorized immigrants). Costs were concentrated in programs that make up a large percentage of total state spending -- specifically, those associated with education, health care, and law enforcement.11 In most of the estimates that CBO examined, however, spending for unauthorized immigrants accounted for less than 5 percent of total state and local spending for those services. Spending for unauthorized immigrants in certain jurisdictions in California was higher but still represented less than 10 percent of total spending for those services.

Experts, news reports trace CA fiscal crisis to state's tax structure, economic downturn

Schwarzenegger said that “economic meltdown and the state's unbalanced tax system are largely responsible” for current fiscal crisis. The Sacramento Bee reported in the June 2009 article that "[f]acing a $24.3 billion deficit after signing a $92 billion spending plan in February, [Schwarzenegger] accepted some blame for what has transpired since he was elected on the promise of fiscal rescue. But he said the world's economic meltdown and the state's unbalanced tax system are largely responsible." The Bee further reported that "[t]he governor said the state's tax structure, which depends on income and capital gains taxes, is too volatile."

NY Times explains "[o]rigins of the [c]risis" stem from state's “disastrously imbalanced” tax structure, which in part comes from Proposition 13, a 1978 “voter-led initiative that artificially depressed property taxes and shifted school financing burdens to the state.” The New York Times reported on the "[o]rigins" of California's fiscal crisis, stating that "[w]hile the state's property taxes are below average, its personal income tax rate and levies on capital gains are among the highest; so unlike states that pass the tax burden around, California can become disastrously imbalanced." The Times further reported that “the protracted national recession delivered a big hit on the state's greatest source of revenue, income taxes on rich people”:

All of this did not creep up overnight. Expansive growth in the first half of the 20th century led to rising housing prices and infrastructure growth, which came with higher taxes to pay for it all.

Those increases created an anti-tax rebellion that begot Proposition 13 in the 1970s, a voter-led initiative that artificially depressed property taxes and shifted school financing burdens to the state. It also led to the onset of a culture of ballot initiatives that have hamstrung state budgeters by earmarking money for programs with one vote and taking away the ability to pay for them with others.

The state's population -- over 38 million today from 23.6 million in 1980 -- has also meant a growing need for costly services for the poor, especially when revenues are declining.

While the state's property taxes are below average, its personal income tax rate and levies on capital gains are among the highest; so unlike states that pass the tax burden around, California can become disastrously imbalanced.

And the protracted national recession delivered a big hit on the state's greatest source of revenue, income taxes on rich people. Further, the state's structural deficit has become exceedingly pronounced after years of accounting tricks and borrowing.

Cohen and Dreier: CA has “three overlapping budget problems” -- “declining revenues,” “irresponsible fiscal policies,” and “most important[ly] ... the fiscal straitjacket created by Proposition 13.” In a February 1 American Prospect article, Donald Cohen, president of the Center on Policy Initiatives, and Peter Dreier, professor of politics and director of the Urban & Environmental Policy program at Occidental College, wrote that "[p]olitics, not plummeting prosperity, are at the root of California's dysfunction." They further wrote that California has “three overlapping budget problems,” including “declining revenues resulting from a long, deep recession”; “irresponsible fiscal policies”; and “the fiscal straitjacket created by Proposition 13.” From the article:

California actually has three overlapping budget problems. The first -- declining revenues resulting from a long, deep recession -- is shared with every other state.

The second is the result of its own irresponsible fiscal policies, which Steve Levy, head of the Center for the Continuing Study of the California Economy, calls “our special hell.” In the late 1990s when the dot-com boom boosted California's economy, state lawmakers increased spending by about $10 billion, mostly to play catch-up on K-12 education and to expand health and social services. But they also foolishly cut taxes by about $10 billion. When the boom busted, revenues fell, but Sacramento neither rolled back the tax cuts nor repealed the spending increases. Desperate for revenues, Gov. Gray Davis, a Democrat, in 2003 tripled the vehicle license fee, which generated $4 billion a year by boosting fees by $130 on a typical car. Schwarzenegger, a Republican, swept into office that same year in part by promising to roll back the unpopular increase in the “car tax.” He kept his pledge and plunged the state into an even deeper budget crisis.

Prop. 13 “capped property taxes” and “created a constitutional requirement that all tax increases pass the [state] Legislature by a two-thirds majority,” which “made California virtually ungovernable.” Cohen and Dreier further explained that the “most important budget problem is the fiscal straitjacket created by Proposition 13, the original tax-revolt ballot proposition that voters approved in 1978, which capped property taxes and made it extremely difficult to raise revenues.” They explain that the law “did more than simply limit property taxes. It created a constitutional requirement that all tax increases pass the Legislature by a two-thirds majority,” which Cohen and Dreier argue “has made California virtually ungovernable.” From their February 1 American Prospect article:

The third and most important budget problem is the fiscal straitjacket created by Proposition 13, the original tax-revolt ballot proposition that voters approved in 1978, which capped property taxes and made it extremely difficult to raise revenues. As a result, even before the recession, California had steadily disinvested in its once world-class education system and physical infrastructure.

[...]

Politics, not plummeting prosperity, are at the root of California's dysfunction. And there is plenty of blame to go around.

Proposition 13, crafted by right-wing political operatives Howard Jarvis and Paul Gann, did more than simply limit property taxes. It created a constitutional requirement that all tax increases pass the Legislature by a two-thirds majority. (The state already had a two-thirds requirement to pass the annual budget, dating back to 1933.)

Jarvis and Gann meant to put the state in a fiscal straitjacket. They succeeded. Now, three decades later, this change has made California virtually ungovernable.

Though the Democrats now have a 51-to-28 majority in the Assembly and a 25-to-14 majority in the Senate, it isn't enough to raise taxes and pass a budget. They need three Republicans in the Assembly and two in the Senate to cooperate. Unfortunately, the GOP has lost virtually all of its moderates and is dominated by rabidly anti-tax, anti-government conservatives -- giving a small minority veto power over the budget.

California fiscal crisis “30 years in the making” because Prop. 13 made it “far more difficult to raise taxes or pass a budget in California than in other states,” and CA “didn't resolve how to pay for the services that people want.” A July 1, 2009, Time article, titled, “How California's Fiscal Woes Began: A Crisis 30 Years in the Making,” reported that “the Golden State's budget problems are hardly new. The seeds of them were planted more than 30 years ago. They begin with the 1978 property tax revolt and the victory of Proposition 13.” The article quoted former California Assembly speaker Bob Hertzberg saying of Proposition 13: “One side was to protect the people from the government suddenly and wildly raising property taxes. ... That was done. But we didn't resolve how to pay for the services that people want. So we have created this crazy government structure in Sacramento held together by duct tape and bailing wire. It's not coherent and needs to be changed.” From the article:

[T]he Golden State's budget problems are hardly new. The seeds of them were planted more than 30 years ago.

They begin with the 1978 property tax revolt and the victory of Proposition 13. As California experienced a dramatic escalation in home values, property tax assessments skyrocketed. Especially vulnerable were seniors on fixed incomes. When then Gov. Jerry Brown and the legislature dithered, conservative activists led by Howard Jarvis put a seductively simple sounding proposition on the ballot. Under Proposition 13, the annual real estate tax on a parcel of property would be limited to 1% of its assessed value and this assessed value would only increase by a maximum of 2% per year, until a change in ownership. Voters responded and Proposition 13 scored a dramatic victory with 65% of the vote. Property tax rates dropped an average of 57%.

[...]

Proposition 13 has proved to be a two-sided sword. “One side was to protect the people from the government suddenly and wildly raising property taxes,” says Bob Hertzberg, a former Assembly Speaker and co- chair of California Forward, a bipartisan reform group. “That was done. But we didn't resolve how to pay for the services that people want. So we have created this crazy government structure in Sacramento held together by duct tape and bailing wire. It's not coherent and needs to be changed.”

Proposition 13 further altered California politics by requiring a two-thirds majority for tax increases either at the state or local level. This requirement along with a constitutional provision requiring a two-thirds majority to pass a budget -- the result of a proposition passed in 1933 -- means it is far more difficult to raise taxes or pass a budget in California than in other states. For more than 30 years California has been living with a system of minority rule in which 34% of the legislature or a local community can stonewall the majority. Facing this post-Proposition 13 system, California's various interest groups have increasingly used the ballot box to protect themselves -- but by so doing have mandated budgetary havoc.

Former CA Assembly budget consultant: “The state got off track in general after Prop. 13 in terms of balancing spending with revenues.” In a September 21, 2009, Sacramento Bee article, Dave Doerr, senior tax consultant for the California Taxpayers Association and a former California Assembly budget consultant, said that "[t]he state got off track in general after Prop. 13 in terms of balancing spending with revenues ... and once they did, it wasn't long before they were way off track." From the article:

From its beginning, California has had a kinetic economy. Gold propelled it into statehood. When the Gold Rush waned, there was wheat, fruit, real estate, movies, oil, defense, aerospace, computers -- and peaks and valleys with each.

That economy occasionally was reflected in state budgets. From 1945 to 1978, according to Department of Finance statistics, state government spent more general fund revenues than it collected in 11 of 34 years.

The relative kiddie carousel of budgetary ups and downs became a white-knuckle roller coaster in 1978, with the passage of Proposition 13, which cut property taxes and required a two-thirds vote of the Legislature to pass statewide taxes.

Of the 32 budgets passed since then, 19 have spent more than the state took in from tax revenues.

“The state got off track in general after Prop. 13 in terms of balancing spending with revenues,” said Doerr, “and once they did, it wasn't long before they were way off track.”

Buchanan has history of attacking immigrants

Buchanan: “Arizona acted because” the federal government failed to “protect the states from invasion” of “illegal aliens.” In an April 26 WorldNetDaily column, Buchanan wrote that Arizona recently passed a controversial immigration bill because the federal government failed to “protect the states from invasion” of “illegal aliens.”

Buchanan: “Sí, se puede” is “the cause of the illegal immigration movement and the amnesty movement.” Discussing then-Sen. Barack Obama's use of the phrase “yes, we can,” Buchanan said: " 'Yes, we can. Sí, se puede.' That's Hispanic. That's the cause of the illegal immigration movement and the amnesty movement." [MSNBC's Hardball, 1/16/08]

Buchanan blamed VA Tech murders on immigrant “invasion,” claimed immigrants “are going berserk here.” Buchanan blamed the April 16, 2007, shootings at Virginia Tech on lax U.S. immigration policies, stating that gunman Cho Seung-Hui “was among the 864,000 Koreans here as a result of the Immigration Act of 1965, which threw the nation's doors open to the greatest invasion in history, an invasion opposed by a majority of our people.” Buchanan suggested that Cho's actions were not an isolated phenomenon, asserting that “in numbers higher than our native born, some [immigrants] are going berserk here.” [5/1/07]

Buchanan: Immigration will turn U.S. into “a polyglot boarding house for the world, a tangle of squabbling minorities.” On CNN's The Situation Room, Buchanan warned that "[w]e'll become a polyglot boarding house for the world, a tangle of squabbling minorities." He continued: “The problem with the immigration, basically -- let's take Mexico -- is these folks are breaking the law, first. Secondly, they're coming in huge numbers, like no other group before. Third, they're from a contiguous nation. Fourth, 58 percent of Mexicans believe the Southwest belongs to them. Fifth, the Mexican government is pushing them in here, and it's got a political and ideological agenda.” [CNN's The Situation Room, 8/28/06]

Buchanan: “I think what's coming is the complete balkanization of America.” On Hardball, Buchanan said, “I think what's coming is the complete balkanization of America, and I'm afraid it's going to be by ethnicity and culture, and language, and every other way. ... And so, then, it's not like the country you and I grew up in, Chris, whereby we were monocultural. We were monocultural.” [Hardball, 6/5/06]

Buchanan: “You're going to have a giant Kosovo in the Southwest, which de facto is going to secede.” On Scarborough Country, Buchanan said: "[Y]ou cannot absorb 40 to 60 million more people. You're going to have a giant Kosovo in the Southwest, which de facto is going to secede from this country." [Scarborough Country, 6/5/06]

Buchanan: Illegal immigration is “an invasion of the United States of America” and "[t]he whole world is coming." On MSNBC's Hardball, Buchanan claimed that the influx of undocumented immigrants into the United States is “not immigration” but “an invasion of the United States of America” that is “coming not only from Mexico,” but “from the whole world.” He reiterated: “The whole world is coming.” [MSNBC's Hardball, 5/15/06]

Buchanan: “They're not welcome to come here and insult the symbols of our country, and that's what these outsiders have done.” On Scarborough Country, Buchanan said that a Spanish-language version of “The Star-Spangled Banner” is “a provocation and an insult” and that immigrants are “not welcome to come here and insult the symbols of our country, and that's what these outsiders have done.” Buchanan then said that the Spanish recording is “a good thing in this sense: The American people are awakening to the character of these people.” [Scarborough Country, 5/1/06]

Buchanan: “Chicano chauvinists and Mexican agents” want to “take back through demography and culture what their ancestors lost through war.” In his book, State of Emergency: The Third World Invasion and Conquest of America, published in August 2006, Buchanan wrote: “Chicano chauvinists and Mexican agents have made clear their intent to take back through demography and culture what their ancestors lost through war.” He also wrote that the United States must keep “Americans of European descent” from becoming the “minority” in order to “survive.” [State of Emergency (Thomas Dunne Books)]

Buchanan: “This is an invasion, the greatest invasion in history.” In State of Emergency, Buchanan also wrote of immigration: “This is an invasion, the greatest invasion in history.” He also wrote: “We are witnessing how nations perish. We are entered upon the final act of our civilization. The last scene is the deconstruction of the nations. The penultimate scene, now well underway, is the invasion unresisted.” [State of Emergency]