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> The Cali budget crisis was caused by a decrease in revenue. Let me repeat that. Decrease. The cited Wikipedia article says that, but it also says: "Another

> The Cali budget crisis was caused by a decrease in revenue. Let me repeat that. Decrease. The cited Wikipedia article says that, but it also says: "Another source has been the continuous growth in salaries and benefits of state employees during economic boom times, some of which were lobbied by trade unions." Note also that the decrease in revenue was due to falling incomes as a result of the recession, not falling rates. Spending was on an unsustainable path based on assuming that boom times would last forever.

toyg 14y ago
The problem with public sector pay is currently an open topic in Europe as well, exacerbated by a generalized crisis of confidence in political classes post-1990. On one side, you have a private sector that is dramatically widening the income gap thanks to globalization processes and technological advances that lower expenses, increase productivity and maximize revenue. On the other, you have a public sector that basically cannot compete for talent unless they try to align to private-sector pay levels, because in a post-Soviet "capitalism-uber-alles" world, public office does not grant much social status in itself. It's a vicious circle: the more we disparage civil servants, the less people are attracted to those jobs, the more you have to pay for lower-quality applicants. The same goes for cutting entitlements, by the way. If you can't make public office appealing in itself, you have to pay civil servants in line with any other similar job, or suffer from corruption and "revolving door" effects with a private sector they're supposed to effectively rein in. This applies even to the most high-profile positions (presidents, senators etc). Remuneration levels for US presidents or British Prime Ministers, for example, are so ridiculously low in real terms, that the office is basically seen by most career politicians as an introduction to the moneyed "conference-speech" circuit, or as a past-time for millionaires. It also makes them ripe for corruption: when somebody earning £ 150k per year has to deal with multi-billionaires, it's easy to predict how it will end.

toyg 14y ago

The problem with public sector pay is currently an open topic in Europe as well, exacerbated by a generalized crisis of confidence in political classes post-1990. On one side, you have a private sector that is dramatically widening the income gap thanks to globalization processes and technological advances that lower expenses, increase productivity and maximize revenue. On the other, you have a public sector that basically cannot compete for talent unless they try to align to private-sector pay levels, because in a post-Soviet "capitalism-uber-alles" world, public office does not grant much social status in itself. It's a vicious circle: the more we disparage civil servants, the less people are attracted to those jobs, the more you have to pay for lower-quality applicants. The same goes for cutting entitlements, by the way. If you can't make public office appealing in itself, you have to pay civil servants in line with any other similar job, or suffer from corruption and "revolving door" effects with a private sector they're supposed to effectively rein in. This applies even to the most high-profile positions (presidents, senators etc). Remuneration levels for US presidents or British Prime Ministers, for example, are so ridiculously low in real terms, that the office is basically seen by most career politicians as an introduction to the moneyed "conference-speech" circuit, or as a past-time for millionaires. It also makes them ripe for corruption: when somebody earning £ 150k per year has to deal with multi-billionaires, it's easy to predict how it will end.