"Meanwhile, California, long a paradise for regulators and public-sector unions, has become a fiscal disaster area."Really? Regulation is too much of a problem? Conservative hackery run amok. Our current fiscal crisis in the country is the result on the one hand of insufficient regulation, and on the other of not enforcing what's on the books properly. Heck, even Alan Greenspan and Chris Cox, hard-core conservatives both, have admitted as much. I don't know what conservatism will look like going forward, but this particular brand of market triumphalism doesn't seem to have much of a future to me. We tried it their way, and the results cost a trillion bucks with nothing much to show for it. I know we're talking about different types of regulation here, but if he's going to argue in the abstract, then so am I.
And Ross doesn't know much about California politics either. I live here--lived in the State capital, no less--so I know what I'm talking about. I'm not going to defend California's public-sector unions, which are something of a problem even for progressives--but the reason why blue states are running bigger deficits would seem to me to be that they offer more services in general than red states--services that are being used more in a downturn than otherwise would be the case. The reason why only blue states are raising taxes is because decades of extreme anti-tax rhetoric from conservatives makes it impossible to raise them anywhere else, even to balance the budget. And the reason why Texas in particular is doing better economically than most states is because, like Wyoming, it relies heavily on energy production, which hasn't been very hard-hit by the recession. California, on the other hand, is a cherry-picked example because it is one of a handful of states that were ground zero of the real-estate bust, like Arizona (which Douthat mentions) and Florida (which he doesn't). Acting as though outliers illustrate a trend does not impress me.
A better explanation of the geographic effects of the recession (this Nate Silver post is helpful in outlining them) would be that a lot of Republican states in the South and Interior West tend to be involved in industries like agriculture (a la the Dakotas) and resource extraction (Wyoming, Texas, the Deep South) that haven't taken a pounding from the recession, while blue states tend to have more financial businesses and larger public sector employment because they, as previously mentioned, offer more services at a time when funds are tight. It all seems reasonable to me, looking at the data (though, admittedly, Nate's post is old). But if you're trying to make a point about how liberalism is somehow responsible for the current economic straits in which we find ourselves, you're going to need a stronger case than this.
I think this paragraph is incredibly oblivious to California's problems in particular:
But in state capital after state capital, the downturn has highlighted the weaknesses of liberal governance — the zeal for unsustainable social spending, the preference for regulation over job creation, the heavy reliance for tax revenue on the volatile incomes of the upper upper class.California's unsustainable spending is largely due to the ease at putting pricey (and unpaid) ballot propositions to the people, as well as the customary downturn in revenue during a recession. But California's taxes are hardly progressive--the state income tax is flat at 10%, and we have a 7.75% sales tax that exempts food, plus large taxes on cigarettes and other assorted smaller taxes. The California tax system (if not the regulatory system) seems like the sort of system that conservatives would like. I'm not disputing that we liberals prefer a progressive taxation system, but that isn't what California's got. Our problems are of a completely different origin--mostly, people buying homes at exorbitant prices that they couldn't afford, aided by banks that weren't evaluating risk properly, ratings agencies that could be bought, financial frauds that found all the loopholes, etc. In other words, the housing bubble bursting was the major reason why we're so screwed up right now.
Much of the rest of the article is boilerplate Republican partisan attacks. And it's a shame. All in all, I miss the old Ross Douthat--you know, the one who talked openly about disliking Grover Norquist and that would put forward workable conservative proposals for policy reform instead of simpering, exaggerated NYT op-eds. What is it about that NYT slot?
Update: Benen is also worth reading on this:
We're in the midst of a major debate over health care policy, and Texas is anything but a "model citizen." It is easily the worst state in the nation for the uninsured, and stands to benefit greatly from the White House's "blue-state agenda." For that matter, its poverty rate is second only to Mississippi nationwide. If Texas is a "model citizen" for taxes and fiscal balance, it's also a disaster for those families who are struggling with less.Just reminds me that judging economic prosperity solely on deficits and taxes ignores a lot of other dimensions to the debate.California is generally a reliable "blue" state, at least electorally, but to characterize it as "liberalism's favorite laboratory" strikes me as more than a little disingenuous. A variety of factors led to the state's condition as a "fiscal disaster area," but near the top of the list are the measures, pushed by the right and approved by voters, that severely restricted California's ability to raise more revenue.
