Tell me again: How will bond help?
It’s not as if I’m not trying to understand. I read my California Sample Ballot 100 times. I even read the Vietnamese version (they print the California Sample Ballot in 536 languages, including Pig Latin), hoping to recognize a symbol or character that could help me figure out how Arnold’s proposed $15 billion bond is going to rescue California from the depths of financial despair.
If I could actually read Vietnamese, I’m sure I’d still be wondering. When you run out of dong in Vietnam, you stay home with the water buffalo. They don’t allow you to borrow more dong to repay the dong you blew on the chicken fights the night before. I know. I went through 2 million dong one night in a fishing village outside of Da Nang. Lost my watch, too, but that’s a story for another day.
So, I decided to go to the secretary of state’s Web site to download a copy of the “Official Voter Information Guide for the March 2 California Primary Election.” On the cover, there’s a nice letter from Secretary of State Kevin Shelly, who swears that the guide was “correctly prepared in accordance with the law.” He did that knowing many of us will read it and mutter, “What a crock!”
The guide even features the Voter Bill Of Rights. In addition to the right to remain silent, for example, you have the right to cast a secret ballot free from intimidation. If someone looks at you cross-eyed in the voter line and menacingly pounds his fist into his palm, you can call security. And if you’re too drunk to vote, you have the right to ask questions, such as, “Is a billion more than a million?”
So that’s nice to know in advance.
But what I needed to know was more about Proposition 57, Arnold’s answer to the state’s credit rating that has dipped below my own. My wife cut my bank card in half two years ago and gives me a $5 weekly allowance with instructions to “not spend it all in one place.” She called that Proposition 1.
The first thing you need to know about Prop. 57 is that it’s headache material. Don’t think you’re going to march right into the booth and start punching holes without boning up first. Most of us wouldn’t know a bond if it climbed out of our wallet.
According to a legislative analyst (not to be confused with someone who provides therapy to disturbed lawmakers), a bond is, “a type of long-term borrowing that the state uses to raise money for various purposes.”
Paying bills, for example.
“The state obtains this money by selling bonds to investors,” the analyst continued. “In exchange, it agrees to repay this money, with interest, according to a specified schedule.”
The Genovese Family of New York got rich under a similar program. If the state misses a payment, some nice people from the bond company come to town and pull out the teeth of the lowest-ranking member of the governor’s cabinet.
What’s amazing is that there are people actually willing to buy these bonds.
California: “Yeah … we’re here to see about the possibility of borrowing … say … $15 billion?”
Bond investors: “Do you have any collateral, or anything to secure the loan?”
California: “How about our grandkids and we’ll throw in the Golden Gate Bridge and Disneyland?”
Bond investors: “According to our background check, you seem to have a little gambling problem. Is that true?”
California: “That’s a lie. It’s no problem.”
Bond investors: “It also looks like you have a little spending problem.”
California: “That’s not a problem, either. As a matter of fact, we spend money rather well.”
As I was reading this voter info, I couldn’t help imagine what it must sound like to someone who recently arrived in this country and was voting for the first time.
“Ahhhhhh. Oonggawa! What a great country! You spend all the money and they keep giving you more!”
According to the analyst, the $15 billion could cost the state $30 billion over 30 years, which really isn’t bad. The Genovese Family of New York would charge California $30 billion for a $15 billion loan over 30 days.
Still bewildered, I called Arnold’s office.
“Mr. Governor,” I began. “I’m really torn over this $15 billion thing of yours, and was wondering if you could tell me how it’s really going to fix California.”
“If we don’t pass this, we will have fiscal Armageddon in Ca-lee-for-nee-ya!” the governor shouted.
I’d seen the movie and knew that an Armageddon is bad.
“But … but … if we are on the verge of a fiscal Armageddon, why did you roll back the car license fee hikes?” I begged, thinking maybe Ca-lee-for-ne-ya could have used the extra money.
“You … you are a smart aleck!” the governor shot back. “You … you … shut up or I’ll ram my fist down your throat!”
Seconds after hanging up the phone, I kicked myself for not asking about the $178 billion they say it takes to run Ca-lee-for-nee-ya for one year, wondering if we could get by on a lot less if we learned to “just say no,” as we advise our children to do. And – if not – why we just don’t resolve ourselves to pay more taxes and fees. Evidenced by the current scene in D.C., where our federal deficit now has more zeros than a Marysville dive bar, you shouldn’t buy bombs with bad checks.
Jeff Ackerman is the publisher of The Union. His column appears each Tuesday.
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