Austerity Works in California

While talking with the Free Will Mother, she said something so totally at odds with reality I wondered whether it was time to look into, ahem, "homes." She said, "Look at Vallejo, it's doing great since they filed for bankruptcy." Now, the FWM is a native Californian (now living in the DC Area) and Goldwater Girl who's always looking for ways to push back against state progressives, but - come on! - Vallejo recovering? Where'd she get that idea? Turns out, she got it from the Washington Post: Vallejo, CA, Once Bankrupt, Now A Model For Cities In An Age Of Austerity

During happier times, Vallejo’s salaries for city employees had ballooned, with a number of top officials making $200,000 or $300,000. More than 80 percent of the municipal budget went toward compensation. 

The city’s credit rating dropped to junk status, and as part of its bankruptcy settlement, Vallejo paid only five cents for every dollar it owed to bondholders. On the labor side, officials cut workers’ pay, health care and other benefits but left pensions intact. 

For Vallejo to survive, two city council members — Marti Brown, 46, a redevelopment worker for the state, and Stephanie Gomes, 45, a legislative specialist for the U.S. Forest Service — decided that the city needed to study best practices from around the world and bring some of them to California. 

“We’re trying to be more innovative and risk-taking,” Brown said. “It’s something we’ve been forced to do, but it’s turning out to be a really positive experience for the city.” 

The police went high-tech, investing $500,000 in cameras across the city that allow officers to monitor a larger area than they could before. The department deputized citizens to participate in law enforcement by sharing tips on Facebook and Twitter.
... 

“We’re seeing a lot of cities around us that are where we were five years ago,” Gomes said. “Some of those cities were laughing at us back then. It’s nice to be on the other side of it.” 

While its general-fund budget of $69 million for 2012-13 is a far cry from the $85 million at its peak in the 1980s, Vallejo is in much better financial shape than many other cities around the country. 

Assistant City Manager Craig Whittom, who has worked in Vallejo since 2003, said the bankruptcy may have been the best thing to happen: “It was effective at helping us re-create ourselves and change the culture so that we could restart from a stronger financial footing.”

Rush Limbaugh likes to call the MSM the "state controlled media," but California has its own special brand. I mean, I have never read any news story in local media that is so positive about Vallejo's bankruptcy and its aftermath.  


I think a lot of folks out there understand that many (not all) of California's woes can be fixed by greatly reducing the size of the state's government, and corresponding tax and regulatory burden. I think the ones who truly know that are the state's employees and their government benefactors. That, no doubt, explains the near-hysteria that greets any proposal to reduce spending, and the embargo on any positive news from successful bouts of belt-tightening.