Fema Employment

Why Keynsian stimulus did not work for California?

The state of of California practiced "stimulus" for a decade. All elements of Obama's stimulus bill were there: * increase in state government spending by 100% * more money for green jobs * 30% of spending financed by borrowing (=deficit) * huge increase in entitlements * and of course free condoms, what else Somehow Keynesian multipliers failed to kick in and economic miracle did not materialize. Instead the state of California became bankrupt on Feb 1st, unemployment is currently 9.5%, and growing.

Public Comments

1. Keynesian bad ideas have been steadily discredited since the time good old John Maynard unleashed them on the world. It's too bad that some people still subscribe to them.
2. The state is bankrupt because of back breaking provisions like Proposition 13 and the elimination of federal medicare funds by Bush (about $10 billion per year in lost revenue) to cover the cost of illegal immigrants and uninsured using health care services. It also didn't help that Arnold cut the vehicle license fee ($4 billion per year in lost revenue). I own 2 homes, but am realistic enough to realize that since Proposition 13 was enacted, the ranking of California schools have dropped from being #1 to being #46 in the US. Most Californians, as a result of Prop 13, have higher sales and income taxes than other states. There is a price to pay to live in California. While the rest of the country is freezing and spending $300-$500/month in energy costs (heating oil, natural gas and electricity), my power bill has only been in the range of $150/mo. The mild climate has it's price and it ain't cheap.
3. I find it bizarre that the majority are following the keynesian economic model - California is just one example of many that show that the model is flawed and doomed for failure - There are alternatives but those in power would end up having to actually spread wealth and power around to quite a few more people -
4. Free condoms.... didn't know that. California is part of the USA.
5. Calfornia has not practiced "Stimulus". Most of the spending is private. If private spending contracts faster than government spending could offset then of course stimulus fails. It needs to be bigger and better.