I have often said that the two people who have most profoundly impacted my thinking on economics are Milton Friedman and Adam Smith. At Christmas I sometimes annoy some of my more liberal Hollywood friends by sending them a gift of Mr. Friedman's classic economic primer, "Free to Choose." What I learned from Messrs. Friedman and Smith is a lesson that every political leader should never forget: that when the heavy fist of government becomes too overbearing and intrusive, it stifles the unlimited wealth creation process of a free people operating under a free enterprise system.That’s pretty good stuff. The money line is this one though:
And that is the essence of the economic and fiscal crisis that confronts the state of California today. Over the past five years our state budget has grown nearly three times the pace of inflation. Our debt burden has risen by more than the other 49 states combined. The matrix of onerous regulations we impose on property owners and businesses has made the cost of doing business in California almost twice as high as in neighboring states. Our tax rates have become among the highest in the nation.
And perhaps worst of all our governor, Gray Davis, has created a counterproductive culture in Sacramento where businesses and entrepreneurs that dare make a profit are treated as if they are enemies of the state. Mr. Davis says he wants jobs, but he has done everything possible to chase away job creators. Thanks to the economic policies of this administration, for the first time in California history more native-born Americans are leaving this state than are moving here. No one would confuse the destructive economic policies of Gov. Davis and Lt. Gov. Cruz Bustamante with the pro-growth ideas of Milton Friedman or Adam Smith.
California does not have a taxing problem, it has a spending problem.A spending problem indeed.
This is a Mexican standoff, par excellence.