Governance and the Lack of Civil Discourse

A Paper and Presentation for the Promise Governance Conference – Covina, CA – August 8-9, 2019.

Have we ever wondered what is at the heart of the political divide between the far right and far left in American politics? Is the far right really made up of greedy self interested, self-absorbed people, as they are sometimes described by the alt-left? Or, is the far left really made up of mush headed, soft thinking bleeding hearts, as they are sometimes described by the alt-right? Is there no way for these groups of people to come to consensus? Is it impossible for these diverse groups to understand each other and to work together for a common purpose? Must disagreements between opposing political or philosophical viewpoints only be solved with violence in words or behavior? 

As stated in the invitation to this conference, “governance should be the process of whereby interested parties interact at various levels, with the aim of reaching one or more mutual beneficial goals.” Therefore, effective discourse and problem-solving must lie at the heart of effective governance. However, it would seem in recent years there is a propensity for an increasing lack of civil discourse. Let’s briefly explore illustrations, the roots, and hopefully the potential steps to address this trend. The number of growing examples of the lack of civil discourse is occurring at the individual,community, business, institutional, and political levels. On June 22, 2018, Sarah Huckabee Sanders was ejected from the Red Hen restaurant in Lexington, Virginia only because she worked for President Donald Trump as his Press Secretary.1 Sanders wrote, “Last night I was told by the owner of Red Hen in Lexington, VA to leave because I work for @POTUS (President of the United States) and I politely left. Her actions say far more about her than about me. I always do my best to treat people, including those I disagree with, respectfully and will continue to do so.” Sanders’ waiter, Jaike Foley-Schultz, at the Red Hen commented on Facebook, “I just served Sarah Huckabee Sanders for a total of two minutes before my owner kicked her out along with seven of her other family members.” And, the Sanders incident occurred just days after Homeland Security Secretary Kirstjen Nielsen was forced to leave a Mexican restaurant in Washington, DC due to hecklers. 

While some were amazed by such treatment, others supported the Red Hen owner’s action by tweeting, “They don’t serve food to fascists? I will be promoting this restaurant to anyone I know in the area.” And name calling (i.e. “fascist”) to get your own political point across to someone else is far from effective, and is more emblematic of an emotional thought process, in contrast to a logical analysis. Somewhat famously now, around May 31, 2018, Samantha Bee, host of the “Full Frontal” TBS show, embraced vulgar name calling and foul language when she spoke of Ivanka Trump, daughter and advisor to President Donald Trump, “Let me just say, one mother to another, ‘Do something about your dad’s immigration policies, you feckless c–t. He listens to you. Put on something tight and low cut and tell your father to f—ing stop it. Tell him it was an Obama thing and see how it goes, okay?”2 Even though Bee later apologized for her actions, it reflects an emotional response to public policy which perhaps should best be handled analytically. 

This unwillingness to discuss sensitive issues neutrally and calmly does not bode well for our society and governance. As a first hand illustration, I have a personal friend in Boston, Massachusetts who is self-admittedly very “liberal” in his political philosophy. Let’s call him Robert for protection of identity. Over the years he and I have had some interesting conversations and I truly wanted to learn from him and understand his world point of view. To that end, I had been given 300 page book titled “Stealing America” by author Dinesh D’Souza, who immigrated to the USA from India with only $500 in his pocket and in 1991 became a naturalized citizen. I may not personally agree with all of his views, but I found his analysis of liberal and conservative political philosophy insightful – particularly in his sixth chapter. 

Over a period of weeks I told Robert of the book and inquired if he might be willing to read and discuss the book together so that I could learn his perceptions. He agreed and so I purchased a copy for him and gave it to him the next time I was in Boston. After chatting for a moment about our plan to jointly review the book, he took it, randomly opened it to a page mid-book, and read three sentences from the top right of the page. He then declared in a bold voice that he did not agree with those three sentences and therefore refused to read the book, despite our previous agreement! I was astonished and commented that while he might not agree with those three sentences (and that I did not agree with the entire text) that there would likely be something he would discover interesting or agreeable within the narrative. He flatly refused again and, unfortunately, that was the end of my attempt for us to learn from each other. I only share this true story to highlight the fact that when humans are unwilling to learn from each other, then communication, problem resolution, and effective governance will be hampered. 

However, such lack of willingness to discuss or learn from each other goes far beyond individual, personal interactions. On April 27, 2019, a small group of self-proclaimed white nationalist interrupted a Saturday author chat with chants and a megaphone at the Politics and Prose bookstore in Washington DC. The flash protest of ten people interrupted author Jonathan Metzl who was speaking to group of about 20 patrons on his book, “Dying of Whiteness,” with chants of “this is our land” for several minutes before leaving on their own accord.3 This behavior, however, is not restricted to one side of the political spectrum. A similar incident occurred just a month before at the same bookstore when Janet Napolitano, former Homeland Security Secretary, was interrupted by left-wing activists. 

Unfortunately, the freedom to have calm and civil discourse is being compromised by all sides. In part, this may be fostered by a sense of personal frustration as feeling unheard in the community dialogue. However, this type of behavior is actually encouraged by some political leaders. Congresswoman Maxine Waters (Democrat, California), who was upset with President Trump’s immigration policies, declared to a crowd of California supporters over the weekend of June 22, 2018 that, “Let’s make sure we show up wherever we have to show up. If you see anybody from that (Trump) cabinet in a restaurant, in a department store, at a gasoline station, you get out and you create a crowd, and you push back on them, and you tell them they’re not welcome anymore, anywhere.”4 

And, one can become suspect by your opponents only because of whom you might interact. On May 11, 2019, Ronald Sullivan, Harvard University Law Professor and Dean of Winthrop House since 2009, was terminated because of student protests over the fact that he accepted the role of being part of Harvey Weinstein’s legal team to defend him on two current rape allegations.5 The two roles were perfectly allowable by the University and did not conflict with each other. However, it would appear that it is not “politically correct” to be associated with Mr. Weinstein who has not yet been convicted of any charges, and approximately fifty students protested for Sullivan’s removal. Harvard Law Professor emeritus, Alan Derschowitz, blasted the University by saying, “This may be the worst violation of academic freedom during my 55 year association with Harvard. Any student who feels ‘unsafe’ in the presence of Dean Sullivan and his wife does not belong at a university. … ‘Feeling unsafe’ is the new mantra of the new McCarthyism. It’s an excuse for firing anyone, from a Republican to a Muslim. … If the student who demanded the firing of Sullivan had been around in 1776, John Adams would have been fired as an author of the Declaration (of Independence) because he made them feel unsafe for representing the Brits accused of the Boston Massacre.” 

And it is easy to violate political correctness, and it can be used as a punishing stick by people who simply have anger in their souls! Of this, I can provide personal testimony. Within the rarefied air of the Governor’s Office of California and its Department of Finance, it seems at times that the political elite can lose contact with the realities of the average working person. Once in an effort to be polite, I advised a co-worker who was waiting for me to finish a job at a photocopy machine, “I’m almost done, ma’am, it’ll just be a moment.” Her immediate response was to berate me for the better part of a minute … “Don’t you know respect? Didn’t you have professional training? Don’t you know the platinum rule – treat others as they want to be treated?!” Well, I simply did not know that she may not like the term “ma’am”, while others may find it respectful. And, I simply did not feel respected by her, as a simple, “Thanks for letting me know. I can wait a moment. But, for the future, I do not care for the term “ma’am.” That would have been a productive, respectful interaction; rather than to take the occasion to bully and berate me. And, the sky almost fell one day while conducting managerial training, as I referred to an “oriental” concept. Nobody, including all of my Asian colleagues, had any problem with the term, except for one human resource staffer who you would have thought died of a heart attack. Sorry, I just missed the memo is all that I could say. No offense intended. 

And, in this day of political extremes, even if you sound as if you are attempting to be reasonable, your own friends may turn against you. One example of this is US Senator Dianne Feinstein (Democrat, California) was roundly criticized by her liberal friends when, upon President Trump’s election in 2016, she simply stated that she hopes he does well. Then, on August 29, 2017, she was booed at a San Francisco event of 800 attendees when she said that Trump could be a good president if he changed his direction. “Look, this man is going to be president, most likely for the rest of this term. I think we have to have some patience – it’s eight months into the tenure of the presidency.” Feinstein, who is the oldest Senator at age 84, was met with shouts amid boos of “Oh, come on!” and “No, no!”6 And Trump’s own comment of there are “very fine people on both sides” regarding the Charlottesville, Virginia violence on August 11 and 12, 2017, has been roundly chastised. However, is it not likely that there could be or are fine people on both sides?7 It seems that people hear what they want to hear and interpret things the way they want to interpret things. As I have often said, it is a life principle that people seem to find whatever they happen to be seeking. If you are looking for employees who are doing good work, you will find them. And if you are looking for employees doing poor work, you will find that also, although they are the same employees in the same circumstances. 

And, there is an additional phenomena which is gaining increasing popularity when debating public policy – that of the economic boycott. In May of this year, Georgia (among other states) passed legislation restricting the use of abortion. Rather quickly, the effort was announced by the filmmaking industry in Hollywood to boycott making all films within Georgia, which in past years has benefitted from the movie industry.8 On May 28, 2019, Netflix said it would withdraw its business from Georgia. Following this, several other companies, such as Disney, CBS, and Sony Pictures, announced that they would reevaluate their production plans in Georgia if the “heartbeat abortion” law was not overturned by the courts before it goes into effect in January 2020. Now, what is the relationship between an unborn child’s life and the making of movies? I do not see any nexus. In a nation where we have an established procedure for making public policy, it is simply saying that if I lose in the democratic process, then I will pout, yell, and scream in the corner – much as a child would. It is resorting to economic violence. It is declaring that, “I don’t like your policy, so I am going to bully or economically beat you up!” 

United States Senator Bernie Sanders (Democrat, Vermont) has recently been espousing the concepts of Democratic Socialism on the campaign trail for the 2020 Presidential Election9. For those who do not believe in those concepts, should they economically boycott Vermont? No more maple syrup? Because you disagree with others over a matter of public policy which is debated in the normal, democratic legislative process, should one attempt to bully or intimidate them economically? Now, I believe in vigorous debate, but when the final vote is taken, that’s the new law. And even then, citizens should vigorously debate if the law should be changed. However, intimidation – physically, verbally, economically, or otherwise – is not part of legitimate debate. It is intended as coercion to force others to accept your point of view. It hinders effective debate, rather than enhances it. And in effective debate, all parties should have open minds and hearts to learn from each other. 

Indeed, scandal itself has become a tool of bullying and intimidation, which the media and general public love. John Marini, a professor of political science at the University of Nevada and a Ph.D. of government from the Claremont Graduate School, noted in his September 11, 2018 address at Hillsdale College that, “Scandal can provide a way for defenders of the (political) status quo to undermine the legitimacy of those who have been elected on a platform of challenging the status quo.”10 In other words, scandal, or the pretense thereof, can be an intentional tool used by political opponents to further their aims. And, I have seen this in my own personal service in government. Words and actions taken out of context by the media or political opponents to undermine public policy, to say nothing of outright lies used to smear a reputation for someone else’s political gain. And, in the words of the 1962 western film, The Man Who Shot Liberty Valance, the newspaper editor justified not publishing the truth in a sensitive political situation by saying, “When the legend becomes fact, print the legend.” In this age of misinformation, beware — the reader, the writer, the freeman, the free mind. 

As Leo Rosten noted in his address to the 1962 National Book Awards in New York City: “The most critical problem which free men face today is to get some of their co-citizens to listen – to listen to that which seems to threaten them. For the right to talk involves the duty to listen. We are raised so that we confuse a way of thinking with the way of thinking. We must try – desperately hard – to see things not as we are but as they are. The function of the thinker, the writer, the editor, — indeed the function of the free man and the free mind – is stubbornly and painfully to try to find truth – truth as it is, not as we want it to be, or hope to be, or prefer it to be.”11 

In 2016, a quiet pizzeria in Northwest Washington, DC became the focus of a nationwide hoax now known as the “Pizzagate” conspiracy theory. Internet hoaxers alleged that the restaurant, Comet Ping Pong, was the center of a child-sex ring run by Bill and Hillary Clinton, as well as her former presidential campaign manager, John Podesta. The sex business was located in the basement of the restaurant, and the restaurant owner was slammed with hundreds of threats. And, on December 4, 2016, a shooting occurred when Edgar Welch drove from Salisbury, North Carolina, armed with a rifle and a revolver, to the Connecticut Avenue Northwest restaurant to investigate and save the children. Evidently well-intentioned, but misguided, Welch discharged his gun multiple times into a locked storage closet which he came upon. Fortunately, no one was injured, but Welch was sentenced to four years in prison. And, more recently, two years later, on January 23, 2019, there was an arson attempt in the same restaurant.12, 13 This is all so interesting because there was no child-sex ring. The restaurant does not even have a basement! Because of all of the misinformation and hysteria, I intentionally made a special trip myself to Comet Ping Pong in February 2017 to speak with the staff. I saw for myself that there was no basement and learned how the owner had to spend thousands of dollars to hire security guards to protect the establishment and its patrons. 

In my personal opinion, we should consider making intentional fake news illegal and criminal. In a society where “truth” should be the foundation for intelligent decisions and public policy, to intentionally create and spread false news is despicable. Fake news discourages civil discourse, and it can certainly be used to create political advantage. However, even prohibiting fake news would not prohibit people from acting foolishly. My experience has taught me to not jump to conclusions; if you can, to go see for yourself; and to withhold making a judgment until you have all of the information. So let us briefly recap our situation. First, governance requires problem solving among all parties. Second, problem solving requires understanding among all parties. Third, understanding requires meaningful dialog and communication among all parties. And it is at this third step were our process, due to the lack of civil discourse, is faltering. 

The third step is being inhibited and we have seen examples of this at the personal, community, institutional, corporate, and political levels. Situations where emotions override rational thinking. Situations where seemly one or another feels that they must win and others lose at all costs. Situations where coercion is justified. 

And, the impact of this breakdown in step three, the lack of civil discourse, is significant. The impact creates feelings of being inhibited or feeling suppressed. The inability to express ideas leads to less viable solutions to community problems. Ideas become diluted as sugar in saltwater. And, the lack of tolerance of other ideas generates even greater emotional hostility. Indeed, those that make civil discourse impossible, seemingly make violent revolution inevitable, which is an unfortunate turn of events for everyone. Perhaps if I yell louder than you, then I will be heard or win? This becomes the new mantra. If perhaps I can throw a tantrum to intimidate, bully, or coerce, then maybe I will be heard or win? Perhaps if I use economic, social or other pressure, I can shame you into submission to my will? Or, perhaps I can follow the legal maxim as coined by Carl Sandberg, “If the facts are against you, argue the law. If the law is against you, argue the facts. If the law and the facts are against you, pound the table and yell like hell.” However, it is a slippery slope, if we are tempted to believe that if you do not agree with me, then you must also hate me. For our duty is to understand each other, and never to resort to violence. In the words of Rosten, “We must learn to seek change without violence. Always change, and never violence – not even in words, much less than deeds. We must try to understand each other by reconciling ourselves to the fact that most of us never mature; we simply grow taller. We must meet fanaticism with courage, and idealism with caution. We must be skeptical of that which is promised, but not proven. We must be strong enough to be gentle.” And, as Stephen Covey well describes in his book, “The Seven Habits of Highly Effective People”14, the fifth identified habit is that we must first seek to understand others, before helping them to understand ourselves.

So, while our process was derailed in the third stage above – understanding requires dialog and communication; we must look at the fourth and fifth steps for solutions and resolution. Fourth, dialog and communication requires trust. Fifth, trust requires relationship. And from my work in peace and reconciliation in various parts of the globe, sixth, relationship requires forgiveness. Seventh, forgiveness requires the ability to change, and eighth, the ability to change requires humility. Therefore, our most central, core problems facing us in reviving civil discourse include 1) personal character; 2) the self-control of emotional response to logical thought; and 3) to rid ourselves of fallacious thinking, which takes many forms, including (among others): • Attacking the person rather than his argument. (Ad Hominem), • Appealing to emotion, and • Hasty generalizations. And if we think that opposing sides are just too far removed from each other to ever come to consensus, yet alone friendship, let me refer you the true story of Ann Atwater and C.P.Ellis, as chronicled in the 2019 movie, “The Best of Enemies”15. Reluctantly, Atwater, known as “Roughhouse Annie”, a strong willed and tireless activist for the black community; and Ellis, the Exalted Cyclops of the Ku Klux Klan in Durham, North Caroline, agreed to co-chair a series of court-ordered mediation meetings regarding integrating Durham Schools in 1971. The story of how these natural arch-enemies became friends over a lifetime, as they developed respect and care for each other, is touching and inspirational. If they can accomplish this in the strained times of the 1970’s, then surely it can be done again … and again.

The owner of the Red Hen restaurant, Stephanie Wilkinson, later told the Washington Post, that when she decided to kick Sarah Huckabee Sanders out of her restaurant that “there are moments in time when people need to live their convictions. This appeared to be one.”16 However, in retrospect, rather than ejecting Sanders and her party from the restaurant after being seated only two minutes, would it not have been more effective to take the opportunity to have a brief, calm dialogue between the two women? How often would Wilkinson and Sanders have the opportunity to meet in person? Perhaps a meaningful relationship could have been built. It was likely a wasted opportunity due to an emotional reaction which was neither respectful nor caring.

At the root of all of these matters regarding uncivil discourse is human character, human foolishness, and human selfishness. As Galatians 5:19-21b (NIV) says in the New Testament, The acts of the flesh are obvious: ….(including) …. “hatred, discord, jealousy, fits of rage, selfish ambition, dissensions, factions and envy …. , and the like.” In contrast, the fruit of the Spirit (verses 22-23) is “love, joy, peace, forbearance, kindness, goodness, faithfulness, gentleness and self-control. Against such things there is no law.” And in verse 25, “Since we live by the Spirit, let us keep in step with the Spirit.” Let us all continually remember and practice that we all need God and the power of the Spirit to surpass the power of the flesh! And, let us take hope in our generation by generation battle for civil discourse within our society, the encouraging words of Oliver Wendell Holmes that, “The mind, once e x p a n d e d to the dimensions of larger ideas, never returns to its original size.”

1 Denis Slattery, “Virginia restraurant refuses to serve White House press secretary, Sarah Huckabee Sanders”, New York Daily News, June 23, 2018,
2 Megan Cerullo, “Samantha Bee Calls Ivanka Trump c-word on show, gets trashed by White House, sponsors”, New York Daily News, May 31, 2018
3 Marissa Lang, “Beyond Politics and Prose: White nationalist target bookstores, libraries in protests nationwide”, The Washington Post, April 29, 2019
4 Jennifer Calfas, “’They’re Not Welcome Anymore, Anywhere.’ Maxine Waters Tell Supporters to Confront Trump Officials”, Time, June 25, 2018
5 Talia Kaplan, “Alan Dershowitz slams Harvard’s decision to drop Weinstein lawyer as dean: ‘new McCarthyism’”, Fox News, May 12, 2019; and NEWSDAY, BBC World News, May 13, 2019
6 Casey Tolan, “Sen. Dianne Feinstein booed at San Francisco event after saying she hope Trump can change”, Bay Area News Group, August 29, 2017
7 Allan Smith, “Conway: Trump’s Charlottesville remarks ‘darn near perfection’”, NBC NEWS, April 28, 2019
8 Amanda Mull, “What Hollywood Boycotts Would Really Do to Georgia”, The Atlantic, June 5, 2019
9 Reid Epstein and Sydney Ember, “Bernie Sanders Calls His Brand of Socialism a Pathway to Beating Trump”, The New York Times, June 12, 2019
10 John Marini, “Politics by Other Means: The Use and Abuse of Scandal”, Imprimis, Hillsdale College, March 2019, Volume 48, Number 3
11 Leo Rosten, “On Finding Truth: Abandon the Strait Jacket of Conformity” Sunday Star, April 8, 1962 Text of Address at the National Book Awards in New York, New York.
12 Kath Smith, “’Pizzagate’ restaurant survives arson attempt and investigators have a suspect”, CBS, January 25, 2019
13 Fox News, “’Pizzagate’ shooter sentenced: What to know about the Comet Ping Pong conspiracies”, FOX, June 22, 2017 14 Stephen R. Covey, The 7 Habits of Highly Effective People, 1990, Fireside of Simon & Schuster, New York, New York
15 Glenn McDonald and Drew Jackson, “’The Best of Enemies’ journey to the big screen is a ‘story that needs to be told’”, Raleigh News & Observer, March 29, 2019
16 Jennifer Calfas, “’They’re Not Welcome Anymore, Anywhere.’ Maxine Waters Tell Supporters to Confront Trump Officials”, Time, June 25, 2018
Copyright W. Bruce Lee, 2019; Duplication only with written permission.

Sacramento Transit Authority, This is No Time to Move Ahead with a Tax Increase

Here’s an excerpt from an article Bruce wrote as the President of the Sacramento Taxpayers Association, as published in Fox and Hounds:

Over the last month, the country has come to a complete standstill

In early March, at least ten California counties, including Sacramento, ordered their residents to “shelter in place” due to COVID-19: no one is to leave their place of residence except for absolute necessities. Soon after, Governor Gavin Newsom extended a shelter-in-place order to the entire state at least until May...

Read the rest of the article as originally published in Fox and Hounds here.

Photo by Alex Bello on Unsplash

A Time For Budget Reform

This article was originally published in the “CAPITOL BUSINESS : The Business-Government Connection” section of the Sacramento Union on May 5th, 1992.

The battle over Governor Pete Wilson’s initiative for budget and welfare reform in California is beginning to heat up this week.  Proposed last December and likely to qualify with 1.1 million signatures given to the Secretary of State two weeks ago, the “Government Accountability and Taxpayer Protection Act of 1992” proposes far-reaching changes in the area of “autopilot” spending.  In that regard, Wilson is exercising leadership in an area that deserves earnest attention and that will have a significant impact on business.

Too much of California’s budget is based on automatic cost-of-living adjustments (COLAs) and “open ended” appropriations where the amount spent is determined by the number of applicants rather than by a decision based on the fixed amount of money we have available to spend.  As Wilson points out, “California government is running up a bill that California can’t afford.”

If California does run up a gargantuan bill, who’s going to pay for it?  The answer – business and those who reinvest capital.  The value of this initiative, according to proponents, is to place stronger management controls on our budgetary affairs.  Furthermore, it serves to protect the legislative system from continuously bending to pressures for increased taxes – taxes which destroy competitiveness, spur business flight and reduce the jobs available to Californians.

The initiative proposes some refreshingly serious steps for these serious fiscal problems.  Major provisions include 1) requiring a budget to be passed by June 15 of each year or else the Governor and Legislature forfeit their salaries and per diem until it is passed; 2) moves the deadline from January 10 to March 1 for submitting the budget proposal so that the proposed budget is more closely tied to current economic conditions with more accurate information; 3) allows the Governor to declare a fiscal emergency if the budget is not passed and signed by July 1.  The current budget then extends into the new year and the Governor can propose reductions in spending programs that are not protected by the constitution.  The spending reductions take effect in 30 days unless the Legislature enacts a balanced budget by a two-thirds vote; and 4) if the budget goes out of balance by 3% or more due to declining revenues or overspending, the Governor can then declare a fiscal emergency and propose budget cuts if the Legislature doesn’t balance the budget within 30 days by a two-thirds vote.

These measures really give the Governor additional clout in the budget.  However, opponents worry that too much authority is relinquished.  According to former legislative analyst A. Alan Post, the initiative gives the governor “total control over the state’s expenditure program.”  This is especially true when the 3% budget imbalance is defined per the budget estimates of the Governor’s own Department of Finance.  Nonetheless, we do need a much better management handle on our state spending.

While the initiative can be attacked from a “balance of power” perspective, it really gets emotional when the welfare reform provisions kick in.  California’s welfare system is now growing four times faster than our overall population – almost 12% annually and a recent report by the Legislative Analyst found that if a welfare recipient took a job paying $1,200 a month that their monthly income would drop by $150.  Obviously, welfare reform deserves some attention.

Common Cause and the League of Women Voters think they’ve found the proposal’s Achilles heel by asking the Courts to throw the initiative out because it covers two distinct subjects – budget and welfare reform – in violation of the Constitution’s “single subject rule”.  However, Wilson’s consultants contend, “You can’t have budget reform without spending reform!”

Common Cause and the League of Women Voters have sued under this provision to keep the initiative off the ballot.  They claim that obviously welfare reform and budget reform are not the same thing,

However, this is the part of the initiative which is receiving the most heated rhetoric by groups claiming that Wilson wants to “force mothers to choose between buying food for their children and paying rent.”

Unfortunately, even though the courts have been liberal in their interpretation of the “single subject rule”, whereby an initiative can only deal with one topic, this could be the Achilles heel of this proposal.   while the Wilson camp says that welfare reform is integral to successful budget reform.  However, it is also apparent that welfare reform can be the “sexy” attention-getter to draw positive voter consideration to the measure while the “drier” elements of budget reform just get pulled along naturally.

Obviously, in big-stake initiative politics, not everything is always as it seems.  And in that vain one of the silliest statements made so far was by the executive director of Common Cause who claimed they were filing the lawsuit “because, in this time of fiscal crisis, we can’t afford to spend taxpayer dollars verifying signatures and preparing for an election on a measure that is plainly unconstitutional.”  Well, that may be a reason of convenience, but it is clearly not the compelling reason why they simply want the measure defeated.

Bruce Lee expresses the views of the California Business League, a trade association dedicated to restoring quality government.  His column appears Fridays in The Union.  If you have comments or an item for the column, write Capitol Business, P.O. Box 60267, Sacramento, CA  95860.

The Warning of No Money and No Business

This article was originally published in the “CAPITOL BUSINESS : The Business-Government Connection” section of the Sacramento Union on July 3rd, 1991.

For the first time in over fifty years, the State Government of California has had a decline in its revenue from previous years.  The 1990-91 fiscal year just closed a few days ago on June 30th with a serious warning for policy makers – a revenue gap of $462 million dollars.  Not since the Great Depression in the 1930’s has California faced the problem of having declining revenues.

The economy is not totally to blame.  We have rarely seen so many years of sustained economic growth as we have in the recent past, even with our slight recessional dips here and there.  In fact, this recent recession appears to be bottoming out much sooner than many forecasters predicted.

While there are many reasons for the lost of revenue, in part I believe it is indicative of our state’s economic engine being dismantled business by business as California loses its economic and competitive advantage to our states.  After all, this is a free economy and nothing says that business has to stay here (or new ones come here), even if we are the land of Hollywood, glamour and sun-drenched beaches.

You may recall that even Jim Morgan, husband of State Senator Rebecca Morgan (R-Los Altos Hills), decided a few months ago to take his new $100 million facility for 2,000 employees out of California to Texas.  According to Mr. Morgan, “the attitude of state and local government toward industry is pathetic.”

When you consider the rising cost of living; workers compensation rates which are almost double some of our neighboring states; prevailing wage legislation; the potential of mandated health care; the proposals for split-role property taxes for business (which will keep coming back); and all of the regulatory hassles (such as SB 198 and the detailed worker safety requirements), why stay?

Aerospace officials expect that most of the Aerospace industry will flee California over the next several decades for all of these reasons.  And that is an unfortunate blow to the California economy when you consider that Aerospace alone employs over 150,000 Californians.  Those employees buy what they need within our local communities, and local government needs every sales tax dollar it can lay its hands on.  Furthermore, each manufacturing employee on average creates 2.25 jobs elsewhere in the state economy.

One company I am familiar with is moving out of its Los Angeles headquarters to the Midwest with the next two years, and taking over 700 employees with it.  The reasons?  First, the cost of living and doing business is over 25% less than in Southern California.  This will save the company millions of dollars which can be better used in product development and valuable new facilities.  Secondly, its employees struggle with the quality of life in Los Angeles area.  Homes are outrageously priced and thousands of man-hours are wasted behind the wheel in traffic jams.  Thirdly, new facilities out-of-state are less expensive than constructing new buildings within California.  Finally, medical care alone will cost one million dollars less than in California.  Given all the facts, they have little choice.  California is pricing itself out of the market.

Given all of the facts, our state and local governments better listen to the economic warnings of our first statewide revenue decline since the Great Depression.  The bell tolls for us.

Attack of the Killer Compact Disc

This article was originally published in the “CAPITOL BUSINESS : The Business-Government Connection” section of the Sacramento Union on June 27th, 1991.

On February 28th of this year, Assemblyman Terry Friedman (D, Los Angeles) introduced a bill into the legislature as an urgency statute to take effect at once for the “immediate preservation of the public peace, health or safety within the meaning of Article IV of the Constitution”.   The emergency – excessive packaging of compact discs and audio cassettes.  A less than burning issue on the minds of many Californians.

Well, this week brings the passage of the bill, now known as AB 861, from the Assembly to the State Senate.  Having passed the Assembly Natural Resources Committee 9:5, the Ways and Means Committee 17:5, and the Assembly Floor 42:31, the bill provides for a $250 fine if a retailer offers to sell an excessively packaged CD or audio cassette ($500 for second or subsequent offenses by reprobate retailers).  However, reasonably enough, the emergency provisions were stricken and the music industry was allowed a grace period until the end of 1992 to minimize its wasteful ways.

Now, Californians do need to change our wasteful ways.  Our landfills are brimming with everything from refrigerators and old televisions to twinkee wrappers and diapers.  However, legislative zeal can lead us a bit too far into improper regulation and micro-management.  Even the lobby group, Californians Against Waste, who support the bill, admit that it is “somewhat alarmist to suggest that CD packaging is destroying the planet”.  However, the current 6″ x 12″ packaging, which is twice the size of the product, is probably a good example of over-packaging.

Despite the good intentions, though, there are many other examples of waste within our society.  Aren’t cloth diapers better than disposables?  Couldn’t we all use cloth bags at the grocery instead of paper or plastic?  How about cereal boxes that are never filled to the top?  Do twinkees really have to be individually wrapped?  (Of course waste is in the eye of the beholder.)  If one industry has its packaging regulated, shouldn’t all of them be?

These types of business and social problems are best solved in the marketplace by the industry itself.  The Recording Industry Association of America claims that it has many concerns about how their products are packaged, including theft issues, refixturing retailer displays and racks (costing tens of millions of dollars), the ability to see and read labels, as well as retooling the machinery to produce and stuff the packaging.  All very legitimate issues, while not even mentioning marketing questions.  It is hard for non-industry people to completely forecast all of the ramifications in running a particular business when changes are mandated upon the industry.

If you don’t micro-manage legislative change, then how do things change?  Well, you get recording artists and environmentalists together to form a coalition called “Ban the Box” and you encourage consumers to leave the excessive CD packaging at the store as show of support for the proposed changes.  You work in the market place and let consumers express their concerns to business.  Business will listen.  It may take some time, but it’s better than abusing the power of government to run roughshod over individual and free enterprize rights.

In fact, Robert Simonds, President of Rykodisc, an independent recording label, did form “Ban the Box” last year and success has been forthcoming.  On March 26th, Jason Berman, President of the Recording Industry Association of American (RIAA), announced that, “There is unanimity among RIAA member companies that the disposable CD longbox is dead.  A number of environmentally friendly alternatives are under active consideration.  Every one of our manufacturing companies is working swiftly and diligently to explore the manufacturing processes involved, the materials to be used and any fixturing issues.”

It’s nice to see the marketplace work.  It is in the business community’s best interest to be responsive to social needs and requests.

The Grocer’s Plight of Bureaucratic Regulation

This article was originally published in the “CAPITOL BUSINESS : The Business-Government Connection” section of the Sacramento Union on June 22nd, 1991.

Sometimes it’s hard for the average citizen to fully appreciate the demands placed upon local business by government regulations.  If you have never run a commercial establishment, then you have probably never experienced it.  However, it is more than true to say that excessive regulation and higher taxes are literally driving businesses out the Golden State.

Grocery stores may be one of the more interesting illustrations of intrusive regulation.  For example, I hold in my hand a four page list of all signs which grocer’s are required to post in their stores within California (and this doesn’t include the variety of local city or county requirements).

We have equal opportunity signs.  Job safety and health protection signs.  “Polygraph Protection Act” signs.  Saccharin notices.  Discrimination in employment signs.  Industrial welfare signs on wages, hours and working conditions.  Minimum wage signs.  Log and summary of occupational injury and illness signs.  Access to medical and exposure record signs.  Emergency phone number signs.  Payday notices.  Worker’ Compensation Carrier signs.  Open and recycling center signs.

Signs regarding the unlawfulness to sell tobacco related products to minors.  Warnings that alcoholic beverages can cause birth defects.  Eating raw oysters may cause severe illness signs.  Handicap signs for checkout lines.  Employee signs regarding unemployment disability insurance.  Warning signs that tobacco smoking is known to cause cancer.  “Recycle your used oil here” signs.  Recycling window decals stating the nearest recycling center and cross streets.  And signs that say containers may be redeemed at a designated cash register, or designated location or with a designated person.

If I was a small grocer, I could run out of wall space, and this is only a partial list.  I would not bother to share the list in such detail, except that it provides a graphic understanding of the degree of government regulation which we have begun to take for granted in our society.  

Signs are just a symptom of even greater burdens which business has to bear.  Sales tax administration is another major headache for grocers.  It use to be simple – if you sold something edible, then you didn’t tax it.  Now sales clerks have to make decisions regarding all sort of products as to whether they are taxable; if they’re wrong, the store has to pay the tax anyway.  Bit by bit, some food became taxable and others not.  First it was soft drinks and then beer.  Now the clerk has to remember which bottles of water are taxed and which aren’t.  And the new, proposed “snack taxes” will tremendously multiple the complexity.

The clerk is now a tax collector and mistakes are often made.  According to Don Beaver, President of the California Grocers Association, it’s not uncommon for a Board of Equalization sales tax audit to place an extra $20,000 to $25,000 liability on a small grocery store for failing to tax everything properly.  The grocer ends up subsidizing the tax rolls because the taxable exceptions are too confusing.  Furthermore, due to all of the sales tax paperwork, it costs the average grocer 2.38 cents out of every dollar to pay for the privilege of being the tax collector.  Costs which are reimbursed by some states, but not by California.

Surely electronic scanners at the check-out will help, but they cost over $10,000 per lane.  With grocers having a 1-5% profit margin (depending on their volume), there isn’t a lot of room with which to play.  Currently, three thousand grocery stores in California have scanners, but five times that amount (over 15,000) are left to wrestle with bureaucratic complexities of the tax system.

These types of regulatory burdens are slowly killing business.  It is essential that policy makers come to appreciate the demands and trials of running a business, or we will continue to damage the economic engine of our state.

Bruce Lee expresses the views of the California Business League, a trade association dedicated to restoring quality government.  His column appears Fridays in The Union.  If you have comments or an item for the column, write Capitol Business, P.O. Box 60267, Sacramento, CA  95860.

Business Loses Lot in Big Money Politics

This article was originally published in the “CAPITOL BUSINESS : The Business-Government Connection” section of the Sacramento Union on June 12th, 1991.

Big money Republican politics is the same as big money Democrat politics.  It’s all one in the same thing, known as establishment or incumbent politics.  And ultimately it’s bad for the business community.  The current illustration of B.T. Collins highlights the situation as he switched his residence at the last moment so that he could run in the July 23rd special election for the Assembly Fifth District (recently vacated as then Assemblyman Tim Leslie became Senator Leslie as he took the Senate seat vacated by John Doolittle who was elected to Congress).

Now there is nothing new or inventive about the political opportunism of a politician switching his residence so that he can run in a different political district.  Although Collins residential switch only moments before the filing deadline (and claiming his residential address as the home of state Finance Director Tom Hayes) is stretching reasonability to the limit.  My point is not about Collins, or any other person, but about the system.  Collins jumped into an election where six other Republicans had already filed because Governor Wilson did not find the other candidates acceptable and tagged Collins for the job.  And I am sure that Wilson will put his Republican money where his mouth is to make sure that Collins wins.

The point, which I have often claimed, is that the established, incumbent political structure has more to do with the selection of candidates, and who ultimately wins, than do the constituents themselves.  The ideal of the citizen government goes further out the window and the grip of the professional government by career incumbents is tightened.  This is bad for business which is forced to deal with policy makers whose primary motivation is to stay in office, rather than to legislate good public policy.

Business has many problems in California – insurance, infrastructure, education, and taxation, to name just a few.  Our legislators have failed to solve one major policy problem in the last eight to ten years, and now we face the $14.3 billion budget crisis.  Furthermore, business is the pot of gold which politicians always tap to fund their escapades.  It still takes money to make the political machinery work – money which could be put to much better use.  Money which is virtually blackmailed from businesspeople so that modest access to the policy makers can be maintained.

Senator Tim Leslie wasn’t going to run for the First Senate seat until Governor Wilson convinced him over a weekend meeting at Rancho Murietta, and then the Republicans put a pile of support into his campaign.  Leslie was a good choice, and a good legislator, in the bipartisan race for the Senate.  However, Wilson giving Collins the nod in a strictly GOP race only points out the true nature of the political establishment.  Without the golden touch of the establishment, citizen-candidates have only an infinitesimal chance of winning an elected seat at the state level.

Business need criteria based redistricting reform so that incumbents cannot build their castle-like safe districts which are impenetrable.  As a ballot proponent of Proposition 140, I urge us not to let term limits fall to the legislature’s challenge of its constitutionality.  And finally, we should consider returning to a part-time legislature.  Strong claims can be made that we accomplished a lot more before we institutionalized our career politicians.  Legislators need to live under the laws that they make and not isolate themselves.

In essence, we need to own and control our own government, rather than it control us.

Bruce Lee expresses the views of the California Business League, a trade association dedicated to restoring quality government.  His column appears Fridays in The Union.  If you have comments or an item for the column, write Capitol Business, P.O. Box 60267, Sacramento, CA  95860.

Privatization Can Work

This article was originally published in the “CAPITOL BUSINESS : The Business-Government Connection” section of the Sacramento Union on June 6th, 1991.

If you are like most businesspeople, you like a good return on your dollar.  If so, then I have a success story to tell you.  I’m delighted to report about Francis House of Sacramento which demonstrates that the answer to all problems is not necessarily government funding and increased taxes.  Francis House is an agency designed to meet the needs of low-income or homeless individuals and families in the Sacramento area.  The primary difference between Francis House and typical government welfare programs is precisely that it is not a government program.  It is fully and totally supported by the private sector, and fulfills an important niche in serving the Sacramento community.

Located on 17th Street between Capitol and L in Sacramento (phone – 443-2646), Francis House operates seven days a week, rain or shine, in offering charity and counsel to those in need.  Be it meals, clothing or shelter, Francis House can provide it.  Furthermore, through its own initiative, Francis House has developed model, computer software to coordinate the resources of 208 agencies within the area to help the needy.  Previously, there was no comprehensive coordination of church, government and community-based agencies for helping the impoverished, be they single parent families parents or men living on the streets.

In the last eight months, Francis House has counseled over 1,230 different people in need, provided over 7,150 complete meals and given out over 17,800 servings of breakfast food.  In the month of April alone, they placed 28 people into permanent housing and 23 people into full-time jobs.  That’s fairly impressive, especially when you consider that it was primarily all accomplished by a core of 30 volunteers (6 of whom were previous clients) and another on-call group of volunteers/advisors also equaling about 30 people.  It is even more impressive when you realize that this was accomplished on a total monthly budget of $8,000 – which covers rent, insurance, food, maintenance, compensation of a full-time director and every other conceivable type of operating expense.

In the public sector, the monthly share of meals alone at a conservative $5.00 per meal would cost over $4,450.  The hours and hours of counseling time would cost public programs at least $15.00 to $25.00 per hour, which would have cost Francis House at least $7,000 per month in itself.

As you look at it, the benefits become obvious of private sector involvement over public sector operations.  Most apparent are the economic values.  Francis House is providing a great value for each dollar invested into it, especially since it is not constrained by the bureaucratic encumbrances of the public sector.  Relatedly, it is seemingly providing much greater productivity for the dollars invested into it.

Furthermore, there are some intangibles which must be considered.  As a completely private agency, it has much greater freedom and creativity in how to solve the problems of its clients, and attention is very personalized.  Its volunteers bring a degree of care and concern which cannot be purchased, or legislated or mandated in any way.  It is the true desire to serve others and to fill a need – it’s not just a job.  Therefore, it is true to say that Francis House not only serves the needs of the needy, but also helps those who need to serve.

It would cost a public agency hundreds of thousands of dollars to do what Francis House does on a fraction of the cost, and it doesn’t cost the taxpayers a dime.  As a taxpayer that makes me feel good, and as a person it makes me appreciate the fact that we don’t have to leave everything to government.  As a businessperson, I like the fact that privatization does work and that there is a place where I, as a responsible businessman, can help meet the needs of my community while knowing that I’ll get an excellent return on my dollar.  As the government budget crisis worsens, the need for private action will increase and Francis House can serve us well as a model.

Bruce Lee expresses the views of the California Business League, a trade association dedicated to restoring quality government.  His column appears Fridays in The Union.  If you have comments or an item for the column, write Capitol Business, P.O. Box 60267, Sacramento, CA  95860.

Taxes Must Have a Rhyme and Reason

This article was originally published in the “CAPITOL BUSINESS : The Business-Government Connection” section of the Sacramento Union on May 30th, 1991.

Tax, tax, who gets the tax?  Like a deviation of the traditional children’s game of “button, button” – the business community, as all California, is trying to guess who is going to get stuck with the new taxes which are virtually inevitable as the legislature tries to balance the $14.3 billion budget deficit.  All sorts of tax ideas are being thrown into the legislative pot as our elected representatives scramble to pluck enough money out of our pockets while offending as few people as possible.  Last weekend’s Assembly and Senate Joint Budget Conference Committee resurrected all manner of proposals and no agreement is in sight.

To name just a couple of ideas, the committee proposed reinstituting an inheritance tax in California (a tax which was disbanded years ago by the voters), and they proposed limiting the mortgage interest deduction for California homeowners.  Of course, ideas from other quarters also abound, such as Governor Wilson’s desire to tax certain types of food.  There is a head over heels rush to increase the state’s income through new or increased taxes.  And with a $14.3 billion deficit, the motivation is reasonable.

However, I must ask if there is any rhyme, reason or logic behind these various tax proposals.  Is it really just a pell-mell rush to tax anything which the legislature thinks it can get away with?  Whichever wheel squeaks the least gets the tax?  Or, are there guiding principles being used as to what makes a reasonable tax and a fair tax?  Unfortunately, I am inclined to believe that it is more of the former, and this leads the general public and business community to further distrust our system of taxation.

I once asked a state senator who has gone on to higher office whether the 120 members of our legislature used any guiding principles in their decision making processes.  He hesitated a moment, and then responded that perhaps a handful do.  The others just make decisions and cast votes based on what seem opportune or workable at the time.  Many vote for something, just because someone else voted against it or to get even with another legislator.  Reasoned principle was certainly lacking in the process.

How unfortunate this is when it comes to taxation – the most potentially tyrannical and dangerous aspect of government.  For indeed, the unlimited power to tax is equivalent to the power to destroy.  And, of course, arbitrary, excessive taxation was the primary provocation for the American revolution in 1776.

Elected representatives must realize that when government takes a portion of a person’s earned income for its own uses, that it is in effect confiscating a proportional percentage of that person’s working time.  Taxation is a form of impounding a share of person’s time and his life.  Furthermore, he is deprived of the fruit of his labor.  Excessive taxation becomes tantamount to a form of slavery.

Therefore, even with the obvious need for money, our lawmakers should take great care in how they choose and implement taxes.  Taxes should be equally and fairly applied.  They should not be arbitrary.  Recognizing that taxing authority comes from the People, the legislature should not flaunt the public will.  Furthermore, taxes should only support the mandated, constitutional duties of government.  Therefore, the scope of our government should be rigorously reviewed so that only enough money is collected to meet the limited functions of our government.  Broad, generous interpretations of governmental duties should be first scrutinized, before increased taxation is liberally applied.

Ben Franklin commented in 1758 that a government would be considered hard if it commandeered more than 10% of its people’s time (ie – earned money).  In combined government taxation, we have well exceeded that mark, and the strain is showing.

Bruce Lee expresses the views of the California Business League, a trade association dedicated to restoring quality government.  His column appears Fridays in The Union.  If you have comments or an item for the column, write Capitol Business, P.O. Box 60267, Sacramento, CA  95860.

Food Tax Will Be a Business Headache

This article was originally published in the “CAPITOL BUSINESS : The Business-Government Connection” section of the Sacramento Union on May 22nd, 1991.

Remember the good ol’ days when you could walk into a grocery store to buy a quick goodie to stave off starvation until dinner time?  Maybe you picked out something healthy like a granola bar, or maybe you got (as I do sometimes) a delicious twinkie with a shelf life of twenty years.  Whatever your habits, going to your store and making a decision as what to buy is going to be a little more difficult for consumers (and a lot harder for retailers) if SB 5 passes the legislature.

SB 5 includes the proposal to help balance the budget by taxing certain food items, commonly referred to as “snack foods”.  The legislation is being carried by Senators Ken Maddie (R, Fresno) and Wadie Deddeh (D, Chula Vista) for Governor Pete Wilson, who dug up the idea in 1990 from a dormant, 1983 piece of legislation.  While proponents claim the tax will raise $270 million dollars, it is certain to be an administrative nightmare and a huge headache for business, which raises the question of how much of that $270 million will be gobbled up by bureaucratic requirements.  If simple tax administration is good tax administration, then SB 5 doesn’t look so good.

The basic problem is that the proposal about what foods are to be taxed is vague and arbitrary.  There is no guiding principle which insures consistency and therefore SB 5 tends to discriminate against many different products and consumer groups.  For example, if you decide to buy raisins, you’re safe – no tax.  But with fig bars, add another 6.25% (7% if you live in Los Angeles).  Crackers and popcorn, normally considered healthy food, are also tax-targeted items, but ice cream is okay.  Granola snacks are taxed, but loose granola isn’t.  Peanuts are untaxed, but pretzels are.  A snack-size apple pie is taxed, but a regular-sized apple pie is not.  There seems to be no basis in nutritional value or caloric content or any other rationale as to why some foods would be taxed and others not.  The main distinction simply seems to be packaging.

What a headache for the stores.  Thousands of minor transactions with some taxed and some not.  In addition, every snack food on the SB 5 list qualifies for food stamp purchases and federal law mandates that food stamp purchases cannot be taxed!  Retailers will go nuts trying to keep up with who and what gets taxed and when.  While some states do place a tax upon food, such as New Mexico; no state in the union taxes just certain foods and not others.  

Furthermore, sales taxes are inherently regressive by their nature, but this proposal really places the burden on the less wealthy.  Under the proposed food tax, the percentage of income paid for these sales taxes by Californians who earn under $15,000 per year would be nearly three times higher than what is paid by the average family.  And it can be argued that if “snack” foods used by average Californians, such as whole wheat crackers, potato chips, pretzels and tortilla chips are to be taxed, then why shouldn’t more expensive “snack” foods such as Brie and macadamia nuts also be taxed?

Brad Sherman, Member of the Board of Equalization, is pushing hard to see that SB 5 is defeated.  And of course, Nabisco and Frito Lay, among others, are actively funding the work to build a coalition of senior, minority, labor, business and taxpayer groups to fight the proposal.  Our state government unequivocally needs the money as the budget deficit has grown from 10 to 12 to 14.3 billion dollars!  Wilson is scrimping to raise 7 billion in taxes and to cut 5.5 to 6 billion out of the budget.  However, taxes cannot be arbitrary and they must have a basic sense of fairness about them.

Bruce Lee expresses the views of the California Business League, a trade association dedicated to restoring quality government.  His column appears Fridays in The Union.  If you have comments or an item for the column, write Capitol Business, P.O. Box 60267, Sacramento, CA  95860.