“The Democratic mismanagement of America’s big cities is becoming a liability for the party. A shining example is Los Angeles, where city leaders this week announced a $1 billion budget hole owing to a slowing economy and soaring payouts to public unions,” notes the Wall Street Journal:
Mayor Karen Bass blamed the recent wildfires…The reality is that the city’s fiscal problems have been building up like dry tinder, and Ms. Bass has made them worse….Ms. Bass has struck new labor agreements that increased city costs by hundreds of millions of dollars a year.
Controller Kenneth Mejia warned in a letter last year to Ms. Bass that “deficits for years to come will force wrenching choices,” which are “not the result of a sudden economic downturn, but the culmination of years of short-term budget balancing”—e.g., accounting gimmicks “at the cost of long-term fiscal sustainability.”…
As city costs are ballooning, tax revenue is declining. Mr. Meija recently noted a decline in “economy-sensitive revenues,” including business, sales and real estate transfer taxes, which preceded the wildfires. Los Angeles’s unemployment rate in December was 6%, higher than any state and even Puerto Rico (5.4%).
High taxes, burdensome regulations, the city’s $17.28 an hour minimum wage, litigation abuse, shoplifting and other crime raise business costs and insurance premiums. Litigation abuse is also busting the city’s budget, with payouts totaling $240 million in the last fiscal year and an estimated $301 million in the current one. “Plaintiff attorneys are getting rich at the expense of taxpayers and city services.”…Alas, plaintiff attorneys are nearly as powerful as public unions in Sacramento.
Los Angeles bureaucrats raked in fat salaries even as fires consumed parts of Los Angeles and fire hydrants ran dry.
Even while cutting funding for its fire department, Los Angeles spent money on things like trans cafes and social justice art.
California has the nation’s second-highest electricity prices, due to costly regulations designed to prevent climate change. But it will likely be worse at fighting climate change this year than Florida, which has lower electricity prices than the national average. That’s because California failed to prevent huge wildfires that result in enormous amounts of pollution and emissions of greenhouse gases. As NPR reported in 2021, “the South is decades ahead” of California in wildfire prevention.
As Claire Lehmann observed partway through the wildfires that recently ravaged parts of the Los Angeles region, “insured losses from these fires will exceed $20 billion, setting a new record for wildfire-related insurance claims in US history. The total economic loss could reach $57 billion. A UCLA study found that California’s wildfire emissions in 2020 were twice the total greenhouse-gas reductions the state achieved from 2003 to 2019. Decades of Californian climate change advocacy has, quite literally, gone up in smoke.” The wildfires this January were even more devastating, and have resulted in far more people being left homeless.
The fires continued for weeks after Lehmann wrote about their devastating cost, and the cost continued rising. “Economists at the University of California Los Angeles pegged the insured losses” from the recent fires “at $75 billion,” and said “the total property and capital losses range as high as $164 billion.”
