Reality Check

Reality Check

Vets the truthfulness of claims and measures the efficacy of public policy

Reality Check: In State of the State, Context is Everything

By Sam Brock
|  Wednesday, Jan 22, 2014  |  Updated 9:24 PM PDT
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Sam Brock digs into the Gov. Jerry Brown's State of the State address. He has given more such addresses than any other California governor.

Sam Brock digs into the Gov. Jerry Brown's State of the State address. He has given more such addresses than any other California governor.

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Jerry Brown is hardly an amateur when it comes to delivering State of the State addresses.

The 75-year-old political veteran is California’s oldest governor, its longest-serving governor and the man with the most experience at presenting California’s annual check-up.

It thus almost goes without saying that Governor Brown has developed quite a skill for controlling and shaping his message.

READ: Full Text of Speech

“Part of the trick here *is the presentation,” observed Bill Whalen, a research fellow at the conservative-leaning Hoover Institution and an expert in California politics. “It’s the art of Jerry Brown.”

Following the governor’s address, we asked Whalen to help add context to some of the claims made in the speech.

In the relatively concise 17-minute remarks (governors have the option to speak for as long as they’d like), Brown highlighted California’s recent resurgence, touting the multi-billion dollar surplus and the wave of new jobs

“What a comeback it is,” declared Brown, singling out his critics. “A million new jobs since 2010!”

Is that figure accurate? And if so, what does it mean?

According to the Governor’s Office of Business and Economic Development, the state had tacked on roughly 868,000 new jobs through the second most recent period of reporting, October 2013.

Attach the November figures, which according to California’s EDD were 44,300, and you have a grand total of 914,000.

Let’s call it an even million, for argument’s sake. That would average out to around 250,000 jobs a year since the economy picked back up after the Great Recession.

Is that brag-worthy growth?

“You throw out a big, sexy number- 1 million new jobs- and it sounds great, but in reality stretched out over 4 years, that’s not overwhelming job growth,” observed Whalen, who said California should be targeting around 350,000 or 400,000 jobs a years during an economic recovery.

“Growth to the effect of 250,000 thousand jobs a year, in a state that has nearly 40 million people and in a state that still has very high unemployment,” really isn’t remarkable, he added. “Perspective is a beautiful thing.”

One of the areas that Brown proved spot-on, according to Whalen, is the assessment of California’s current boom has a “feast or famine” type cycle spurred on by large returns in the stock and real estate markets, revenue streams that won’t stay at their current red-hot pace forever.

“The business cycle and the stock market are historically volatile, with good news followed by bad with painful regularity,” Brown lamented. “And while we know our revenues will fluctuate up and down, our long-term liabilities are enormous, and are ever growing.”

The governor implored the legislature to create a Rainy Day Fund, similar to ones adopted by other states, that sets aside a percentage of state surplus funds for when revenues dip.

While such a measure would help secure some savings, it wouldn’t address the state’s dependence on boom-or-bust revenue streams, something Whalen would have liked to hear.

“He identified and recognized a problem,” Whalen said. “But [on the other hand] he didn’t offer a solution. And therein is the challenge.”

One item that received only a passing mention in the State of the State address was high-speed rail, a project near and dear to the governor’s heart.

“We’re on our way to 1 million electric vehicles, and we’re building the nation’s only high-speed rail,”Brown reeled off at the end of his speech, almost as an aside.

That was the sole reference to high-speed rail.

The lack of attention paid to Brown’s highly-visible and most financially-ambitious project may have taken some by surprise.

The Hoover Institution, however, surveyed a thousand Californians in December and found that high-speed rail is at the bottom of the list when it comes to public interest.

You can find details of the survey here.

The three items that polled the highest were economic growth (71 percent), job creation (70 percent) and balancing the state budget (64 percent). High-speed rail came in dead last with 10 percent of those surveyed describing it as a “top priority.”

“The governor clearly values high-speed rail as part of his legacy, as something big and ambitious, something his father, Pat Brown, would have done,” Whalen said.

“But the reality is when you actually get down to the details of high-speed rail with voters, it doesn’t work with them too well.”

The project is currently under court review, with a Sacramento judge already ruling that the California High Speed Rail Authority needs to demonstrate how it will pay for the first usable leg of the route.

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