Jun 11, 2009 8:36 pm US/Pacific
Gov's Budget Chief: Middle Class Squeezed
SACRAMENTO (CBS 5) ―
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Gov. Arnold Schwarzenegger and Department of Finance Director Mike Genest.
CBS
It was one of the most controversial statements to come out of the state Capitol in a long time, and it came from Gov. Arnold Schwarzenegger's own budget chief.
"If you look at what the government does, the government doesn't provide services to rich people. We don't provide very many services, even, to the middle class," state finance director Mike Genest told reporters on a conference call.
That admission — that state government doesn't provide many services to the middle class — has set-off a debate over whether the vast majority of Californians, those who pay the bulk of the taxes, are getting what they pay for from the state.
"We understand what he was saying, which is that more and more government is viewed, and is in fact a tool to redistribute wealth from those who have money to those who don't. It didn't always use to be that way," observed Jon Coupal, who runs the Howard Jarvis Taxpayers Foundation.
About half of the state budget goes for public schools and another 30 percent goes for welfare and state medical programs, so those two items account for 80 percent of the budget.
"If your kids go to a private school, you're not using the school system, you might be using the DMV, but you're not going to be using any other public assistance program," said political consultant Patrick Dorinson.
"The problem is that the middle and upper classes don't use the welfare, don't use (state) health care," he continued. "They dont use any of the other things that lower classes use."
But not everyone buys the notion that state government doesn't do much for the middle or upper classes.
"That's absurd," contended Tim Hodson of the Cal State Center for California Studies. "Let's put it this way: for every dollar that the state spends, 40 cents of that goes to public schools, and those schools are in Atherton and Saint Francis Wood as well as in Oakland or San Mateo."
Hodson continued, "Do you drive roads? Do you breathe air? Do you drink water that isn't poisonous? Do you take your sewage out to the gutter in a bucket or does it flush down a sewage system? Do you ever go to Angel Island. Do you go down to the Redwoods at Santa Cruz? If you do any of those things, you are consuming state expenditures."
How did Schwarzenegger react to his finance director's comments.
"Well he's absolutely correct that most of the services, and thank God, most of the services ought to be always for people that are poor, people that are helpless, people that are low income. I mean that's what it is meant for," the governor told CBS 5.
"So, we have to be very careful with this, but usually when you make cuts it comes from people that need those programs. There's no two ways about it," Schwarzenegger explained.
When asked whether he could understand why middle class taxpayers might not be sympathetic to paying more money to support state spending, Schwarzenegger responded: "Well, you know, people sometimes want the services but they don't always want to pay for the services."
But whether the middle class is getting the services that it pays for remains the unanswered question in the minds of some taxpayers.
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
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