California’s Budget: A Deficit of Common Sense

SACRAMENTO — One would never know from the new $310 billion state budget that California had been experiencing an enormous $32 billion deficit. Gov. Gavin Newsom and Democratic legislators touted all the spending in the new deal — including a bailout for struggling transit authorities, additional funding for a laundry list of programs, and an extension of the Hollywood film credit.

In fact, Newsom has boasted that the tougher economic times won’t change his second-term priorities, so consider his budget deal the down payment on that promise. The governor and the Democratic Legislature have built their entire careers around spending more money to address California’s problems, so the spending train surely will chug along.

There are some cuts, for sure. The budget blueprint trims some $3 billion from climate-change programs. Mainly, “the governor is proposing various budget gimmicks that … largely shift general-fund spending to other sources,” the Orange County Register reports. It’s more smoke and mirrors than fiscal discipline.

I doubt that slightly fewer state “investments” in the battle against global warming will make much difference in any of our lives. Newsom did secure some reforms to the California Environmental Quality Act (CEQA) — the “landmark” environmental law that slows infrastructure projects, which is good news. Nevertheless, this “kick the can” budget makes few systemic changes, and lawmakers continue to dig a deeper fiscal hole.

In particular, the state is ramping up giveaways to the public-employee unions. One of the worst bills, which would set precedent for other unions, would grant California state firefighters automatic, guaranteed pay raises forever. It cuts future Legislatures out of the picture, which means fewer tools to rein in future deficits. California Highway Patrol officers already receive automatic pay hikes.

“This bill would require the state to pay firefighters who are rank-and-file members of State Bargaining Unit 8, employed by the Department of Forestry and Fire Protection, within 15% of the average salary for corresponding ranks in 20 listed California fire departments,” per Assembly Bill 1254. It’s authored by Assembly member Heath Flora, thus showing that California Republicans can be as fiscally irresponsible as Democrats.

This is a common California union negotiating trick. In some cities, union-owned legislatures agree to keep their bargaining units in the top 50 percent of pay statewide. That creates a never-ending ratchet effect because — like in Garrison Keillor’s Lake Wobegon — no one is ever below average. Once one city drops below average, another automatically boosts its pay.

After a severe season of wildfires, everyone in California is appreciative of the hard work done by the state’s firefighters. However, Cal Fire firefighters receive extremely generous compensation packages — around $150,000 per year total. That’s just the average.

“We now have a world where you can work at Target and In-N-Out and make $22 an hour and our starting firefighter makes $15.56 an hour,” one union official told CalMatters. “Who’s gonna want to put their life on the line in a time where the state really needs firefighters when they can go work somewhere else and make more money?”

Sure, some seasonal firefighters receive modest pay, but full-time firefighters earn the above-mentioned average — and dozens of them receive compensation packages that can top $500,000 a year. Scroll deeper into that news story and we find this line that addresses the union president’s poor-mouthing: “The average monthly total compensation for a Cal Fire battalion chief was $29,697, according to a 2020 salary survey.… Lower-ranking firefighters earned $19,288 monthly in total monthly compensation.” That pay is for four 72-hour shifts a month and includes time paid for sleeping. It’s tough work, but the pay levels explain why California relies so heavily on inmate firefighting labor ($2.90 to $5 per day).

State firefighters, however, remain upset that municipal firefighters earn even more. CalMatters explains that local battalion chiefs earn 40.7 percent more than their state counterparts, and local lower-level firefighters earn 15.8 percent more. There’s a reason why cities have at times opened arenas to handle the thousands of applicants for the occasional job openings.

Here’s a 2020 analysis from the California Policy Center’s Edward Ring:

There is now a $300,000 club for California’s firefighters. In the city of Manhattan Beach during 2018, the average pay and benefits for a full time firefighter were $300,242. While the Manhattan Beach firefighters, at least through 2018, belong to an exclusive club, twelve California cities pay their firefighters over $250,000 per year, and 69 California cities pay their firefighters over $200,000 per year.

This isn’t the only attempted union pay bump. The state has agreed to increase pay for state service workers by 6 percent over 3.5 years, but the Service Employees International Union Local 1000 is demanding a 26 percent hike. Other unions have secured major pay increases as part of the recent budget negotiations. In California, the tail always wags the dog.

It remains to be seen whether the firefighters get their pay bump, but it’s frustrating to watch the state embrace new spending deals as it struggles with its deficits. It’s not as though there aren’t better alternatives. Last year, Newsom signed a new law that essentially forbids cities from offering their firefighters 401(k) retirements rather than the current pensions that provide 90 percent of final pay as early as age 50.

In the recent past, big deficits forced lawmakers to make tough choices. Now they just keep spending and rely on budget gimmicks to get us to the next crisis.