[quote=CA renter]
I’m not talking about GDP growth. I’m talking about population growth. THAT is what adds more to our social/legal/physical infrastructure burden. And many of these new residents are not contributing as much to the tax base, per capita, as the residents who were already here before 1970. From 1970 to 2010, California’s population grew by almost 87%, and this is only what is officially accounted for. There are probably many “undocumented” immigrants who are not counted in those numbers.
[/quote]
The tax base (i.e. revenue available to distribute to Public Sector Employees) is directly related to population growth and productivity growth. More people working and people working more productivily expand the economy. Unfortunately with the way the public sector operates you don’t get to include the growth from population as you must expand the employee count to match the population growth.
The public sector revenue source is directly related to GDP as it is a tax on overall GDP. Therefore in order for public sector employees to grow their wage and benefit package in excess of the private sector GDP growth they must do one of four things.
1) Increase the amount they take from the private sector. Add taxes or increase taxes.
2) Allocate more of their budget to salaries and benefits and stop allocating money for known other costs like maintenance.
3) Defer compensation and promise future returns.
4) Improve efficiency. Provide more services with fewer workers.
For a long time they’ve relied on options 1-3 and public sector employees have enjoyed a period of expanded standards or living though those means. Now they are relying on option 4 and hoping that courts will force option 1 but it’s most likely that when push comes to shove it will be easier to leave public sector retirees high and dry. They are the minority in this mathematical equation.
