More Shameless Self-Promotion

I have been traveling for the last week, in my endless defense of capitalism and all things good and proper, and so let me note a bit tardily for all Reform Clubbers a "Statement of California Economists In Favor of Constitutional Spending Limitation," published jointly by the Howard Jarvis Taxpayers Association and the Pacific Research Institute (where I am a senior fellow). The statement, published as part of a double-page advertisement in Tuesday's Sacramento Bee, was written, and the forty-two signatures gathered by, ... yes, yours truly. Nobel laureate Milton Friedman is one of the economists endorsing the statement, a very, very good group indeed. The statement and economist list are reproduced below. The Left is fond of arguing that "California should be a leader," meaning of course that it should use political and regulatory processes to steal the property of others; I too believe that the Golden State should lead, in a direction rather different:

NOBEL LAUREATE MILTON FRIEDMAN AND FORTY-ONE OTHER LEADING CALIFORNIA ECONOMISTS ENDORSE THE FOLLOWING

STATEMENT IN FAVOR OF CONSTITUTIONAL SPENDING LIMITATION

<>March 2005

<>

<> Every California family must make difficult spending choices among housing, groceries, clothing, and the like within a fixed overall budget. Similarly, Californians through democratic processes choose between overall public and private spending, and among various public programs. Because there always are limits to the ability of taxpayers to finance public spending, there must be an overall budget maximum for state spending programs, a constraint within which government officials and agencies must learn to operate. < style="font-family: times new roman;">
California’s tax rates are among the highest for the fifty states, and its business environment in terms of investment and employment expansion is poor. This means that Californians cannot afford higher taxes; indeed, California cannot become fully competitive with other states without tax relief, and taxes will not be reduced until spending is brought under control.
Despite revenue growth of $5 billion for the next fiscal year, the longer term structural deficit in the California state budget now is estimated at about $6 billion or more annually. This now-familiar imbalance between pressures to spend and the ability of Californians to finance larger government results from the political environment within which public officials make choices: Pressures to spend more each year are exerted by large, identifiable groups that can deliver sizeable blocs of votes, while the benefits of fiscal discipline accrue to millions of less-organized taxpayers and to the economy as a whole.

A constitutional spending limit will help to reform the inconsistent spending mandates now embedded in California law, and will force government to recognize and operate within the limited incomes earned by Californians. A mere balanced-budget requirement---even if it could be enforced---would allow government to spend as much as it manages to collect, a system that will not force public officials to recognize fully the cost of government spending. That is why constitutional spending limitation now is necessary for the long-term economic health of California.

< style="font-family: times new roman;">< style="font-family: times new roman;"><>Signed (Affiliations for identification purposes only).< style="font-family: times new roman;"> < style="font-family: times new roman;">

Armen A. Alchian University of California, Los Angeles

William R. Allen University of California, Los Angeles

Charles W. Baird California State University, Hayward

Ronald Batchelder Pepperdine University

Richard A. Bilas California State University, Bakersfield

Thomas E. Borcherding Claremont Graduate University

Henry N. Butler Chapman University

Henry G. Demmert Santa Clara University

Harold Demsetz University of California, Los Angeles

Arthur Denzau Claremont Graduate University

Larry Dougharty Former Mayor, City of Manhattan Beach

Fred E. Foldvary Santa Clara University

Milton Friedman Hoover Institution, Stanford University

Gary M. Galles Pepperdine University

Thomas W. Gilligan University of Southern California

Rodolfo A. Gonzalez San Jose State University

Peter Gordon University of Southern California

Steven F. Hayward Pacific Research Institute

Dale M. Heien University of California, Davis

David R. Henderson Hoover Institution, Stanford University

Jack Hirshleifer University of California, Los Angeles

Jesse R. Huff Former Director, California Department of Finance

Ronald N. Johnson San Diego, California

Daniel Klein Santa Clara University

Robert C. Krol California State University, Northridge

Clay La Force Dean Emeritus, Anderson School of Management,

University of California, Los Angeles

Tibor R. Machan Chapman University

Michael L. Marlow California Polytechnic State University, San Luis Obispo

John G. Matsusaka University of Southern California

Lawrence J. McQuillan Pacific Research Institute

Tom Means San Jose State University

Robert J. Michaels California State University, Fullerton

Lydia D. Ortega San Jose State University

Neal A. Pepper Los Angeles, California

Philip Romero Former Chief Economist to the Governor of California

Alan C. Shapiro University of Southern California

Stephen Shmanske California State University, Hayward

Edward Stringham San Jose State University

Shirley Svorny California State University, Northridge

Thomas D. Willett Claremont Graduate University

Paul J. Zak Claremont Graduate University

Benjamin Zycher Pacific Research Institute