When Governor Jerry Brown, back in the 1970′s, suggested that California should have its own aerospace program, he was dubbed “Governor Moonbeam,” and the moniker has stuck to this day. That’s too bad, because at the time Gov. Brown made that statement, California had the most robust aerospace infrastructure in the U.S. The nexus of companies in Los Angeles – Northrop, Hughes, Rockwell, TRW, plus the branches of dozens of others – the launch complex at Vandenberg, the vast resources of land in the Mojave including Edwards AFB – made California a natural location to further America’s space efforts.
Today half of the companies noted above have been driven out of California by over-regulation, and instead of talking about mining the asteroids for platinum, Jerry Brown is talking about bullet trains to nowhere. Before you laugh at the Gov. Moonbeam’s original idea, consider California-based entrepreneur Elon Musk, founder of SpaceX. This private aerospace company, which is already supplying launch vehicles to NASA, is now rolling out their “Falcon Heavy,” the largest launch vehicle since the Saturn V moon rocket.
The asteroids will be explored and mined by robotic spacecraft within a few decades. And much of the ingenuity and entrepreneurship, risk capital, and high technology will be coming from California. Imagine if California’s dawning recapture of the lead in aerospace technology, following her existing lead in biotech and info-tech, were encouraged by California’s laws and regulations instead of occurring in spite of them?
There are two steps towards putting California back on track. Both relate to public policy: One, reform California’s government and make it more business friendly, two, set a government project agenda that emphasizes infrastructure over pay and benefits for government workers. These steps will lower the cost of living for all California residents.
It would be an ironic blessing if California’s bloated, dysfunctional state and local governments were to financially implode sooner than anywhere else in the U.S., because it would mean Californians would be the first to come out recovered on the other side. It will be a painful transition, but manageable if investments into projects that lower the cost of living are made at the same time as austerity measures are imposed on government workers and recipients of government entitlements. Here are solutions for California:
(1) Balance State and Local Government Budgets:
(a) Lower the wages of all state and local government workers by 20% of whatever amount they make in excess of $50,000 per year. Lower the wages of all state and local government workers by 50% of whatever amount they make in excess of $100,000 per year. Include in “wages” ALL forms of compensation.
(b) Impose special tax assessments on state and local government pensions in the amount of 50% of all pension payments in excess of $60,000 per year and 75% of all pension payments in excess of $100,000 per year.
(c) Require 75% of all school employees to be teachers in a classroom. Raise average class size to 30 students per classroom by abandoning the failed policy of “mainstreaming” virtually all students, and by separating students into classes based on their academic performance.
(d) Faithfully implement the welfare and entitlement policies already adopted by most other states during the Clinton administration.
(2) Change the Rules in Sacramento:
(a) Implement fundamental curbs on the rights of public sector unions, including: Grant all public sector workers the right to opt-out of union membership and payment of any union dues including agency fees. Prohibit government payroll departments from collecting union dues. Allow all public sector employees to negotiate their own wages and benefits and not be bound by collective bargaining terms if they wish. Prohibit public sector unions from negotiating over long term benefits, and require all current wage and benefit agreements to expire at the end of the term for the elected officials who approved the agreements. Prohibit public sector unions from engaging in political activity of any kind.
(b) Discontinue the planned “CO2 auctions,” which are nothing more than a way to redistribute money from middle class ratepayers to bankers, phony green entrepreneurs, and public sector payroll departments. Repeal AB32. Crucially, lift the crippling burden of land use regulations that keep the prices of homes and commercial property ridiculously high in California.
(c) Revisit all business-friendly recommendations made by business associations such as the bipartisan California Chamber of Commerce. This would not include compromise positions in support of public sector unions and crony capitalist environmental regulations. This would include banning mandatory project labor agreements or requiring union only contractors on government funded projects.
(3) Use government surpluses to engage in public works, and streamline permitting for private infrastructure investments, that LOWER the cost of living for everyone:
(a) Rebuild California’s aqueducts and develop additional aquifer and surface storage for runoff harvesting. Build desalination plants on the southern California coast. Upgrade existing dams and pumping stations. Permit farmers to contract with California’s urban water districts to sell their water allocations. Create water abundance and make water cheap.
(b) Build new power stations. Whether this is a joint project with Nevada to establish nuclear power stations in the vicinity of Yucca Mountain, or building new natural gas fired power plants, the immediate establishment of an additional 20%+ of generating capacity in California would allow a lowering of utility rates and make California a net exporter of electricity.
(c) Enable development of offshore oil and gas using slant drilling from land. It is no longer necessary to develop offshore drilling rigs to extract energy reserves. There are cost-effective ways to bring this energy onshore without the risk of an oil spill from an offshore platform.
(d) Enable development of natural gas reserves in California.
(e) Enable development of mines and quarries in California.
(f) Build additional pipeline capacity into California to import and export natural gas to and from elsewhere in North America.
(g) Permit development of a liquid natural gas terminal at least 10 miles off the California coast. Get California onto the global LNG grid to import and export natural gas and further diversify sources of energy and income. Create energy abundance and make energy cheap.
(h) Upgrade existing roads, bridges, and freeways. Begin working on “smart lanes” that will facilitate cars driving on autopilot.
(i) Instead of developing a bullet train – something that might be worth experimenting with once everything else on this list is done and Californians have money to burn – upgrade California’s existing freight and passenger rail infrastructure. When practical, integrate passenger and freight service on common rail corridors in large cities where high population densities make passenger rail economically viable. Complete a passenger rail link from Bakersfield to Los Angeles. Increase the speed of intercity passenger rail to 100+ MPH, which can be done on upgraded but already existing track.
Implementing policies designed to lower the cost of living is a perilous undertaking. Because it involves increasing the supply of all basic commodities and services including taxes, housing, energy, water and transportation, it lowers profits and can contribute to a deflationary economy. But by lowering the cost of living, despite the fewer dollars earned by our public sector workers, or by our private sector workers employed by corporations competing in the global economy, the overall standard of living may actually improve.
The solution for California is to develop infrastructure to lower the cost of living at the same time as deregulation is encouraging economic growth. Because California enjoys so many gifts – natural resources of staggering abundance and diversity, and an economy that is the technological leader in the world – the solutions described here, though painful, will ensure California survives and thrives during what are sure to be challenging years ahead.
During the 21st century there are two competing models of economic growth. The path we’re on involves artificially inflating the prices of all basic commodities. Staying on this path will reduce global competition, empower entrenched global elites, and consolidate the power of public sector unions, monopolistic corporations, and global bankers. Economic growth will be slow, and in terms of genuine productivity, it will be an anti-competitive age of control by the few over the many, and a sad utilization of the great technological advances we have seen in recent decades.
The alternative economic model for California is to adopt policies that dismantle monopolies, nurture competition, and encourage new development of land and resources. If costs for basic commodities are lowered instead of raised, capital is released to finance completely new industries, from space commercialization and development to life-extension and other fundamental advances in medicine. This will cause rapid and sustainable economic growth, unprecedented per-capita prosperity, even faster technological advancement, and a renewed golden age.