Someone once said that before you can arrive at the answers, you must first fully understand the questions. When it comes to questions surrounding government budgets, it’s hard to know where to begin. Here are a few points to ponder.
The SF Chronicle recently reported that 300 city employees were issued layoff notices. That same week, the paper reported that SF Firefighters were scheduled for a 7 percent raise in 2009! (Presumably, the 300 city workers could keep their jobs if the firefighters’ raises were cancelled or trimmed.)
In a letter published by the Mercury News, a Cupertino resident reported that “California’s general fund spending had increased from $75 billion in March 2004 to $105 billion today.” (That’s a nearly 50 percent increase in less than five years!)
San Jose’s projected budget deficit is now $65 million (according to Councilmember Oliverio’s recent SJI post). How in the world did the city’s budget deficit level accelerate so quickly?
QUESTION: Is the “budget crisis” at every level of government a product of too much spending, or reduced revenues? The answer is, of course, both.
Okay…where do we start? What recommendations do you have to reduce government spending in San Jose, and what great ideas do you have to bring new revenues to the City?
Increasing the revenues (taxes) tend to motivate business’ and people to move to other areas. I believe that the city should reduce the employees by ten %. This can be done by not replacing retiring workers and removing temps. And if raises are suspended until the budget is balanced it would help. I realize that these ideas will not be popular but we must bite the bullet some way.
Why does Victor Ajlouny have a long term contract? Isn’t that an expense San Jose can do without?
Perhaps I speak from ignorance, but since deficit is the measured shortfall between incoming tax revenue and budget, I suspect that the rapidly devolving economy led to a rapid decline in expected sales and property tax revenue.
Federal government faces the same issue. There is a downward trend in expected income tax revenue since we’ll all be claiming stock and property losses.
Government folks just don’t get it. They don’t treat tax money as if they paid it out of their personal pockets. It’s “monopoly money” to them. We used to think Billions was big. Obama is now talking in Trillions for budget deficits.
Every President since at least Reagan has preached downsizing government, and the number of federal employees has outpaced population and budget growth anyway. Every president has left with a larger federal bureaucracy than existed when he entered office. I suspect the same is true in all states and localities that are in budget trouble.
Barney Frank got real huffy when he said that the bailout cannot include bonuses for CEO’s. As usual, Barney got it exactly wrong. In order to get federal bailout $$ top managment must pledge to $1.00/year salaries, with their major compensation coming from performance bonuses if the firm and its stock do well.
Barney’s plan, as all democratic plans, is the union model—if you just show up, you get paid hansomely, and you’ll get annual increases no matter how poorly you perform. The layabout gets the same rate of pay as the conscientious worker who tries her/his hardest for quantity and quality. There’s no incentive to excel; everything is an entitlement.
And we can’t fire you unless you kill your supervisor on the jobsite AND mess up the furniture in so doing. So, what’s the incentive to do well…better??? NONE! ZILCH! NADA! ZERO!
If Barney’s model passes, we’re all screwed. CEOs will get big guaranteed pay packages, no incentive bonuses/stock options, and so they’ll just do as most government workers and union types do—show up with their hands out asking for more simply because another year has passed.
CEO’s, and professional athletes, too should have 99% of their pay based on performance, not time in grade, or longevity, or entitlements.
Reduce spending in San Jose, you ask?
Pete it`s to late.
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