Ronald Reagan - California And The Problem Of Government Growth

January 5, 1967

To a number of us, this is a first and hence a solemn and momentous occasion, and yet, on the broad page of state and national history, what is taking place here is almost commonplace routine. We are participating in the orderly transfer of administrative authority by direction of the people. And this is the simple magic which makes a commonplace routine a near miracle to many of the world’s inhabitants: the continuing fact that the people, by democratic process, can delegate this power, yet retain custody of it.

Perhaps you and I have lived with this miracle too long to be properly appreciative. Freedom is a fragile thing and is never more than one generation away from extinction. It is not ours by inheritance; it must be fought for and defended constantly by each generation, for it comes only once to a people. Those who have known freedom and then lost it have never known it again. Knowing this, it is hard to explain those who even today would question the people’s capacity for self-rule. Will they answer this: if no one among us is capable of governing himself, then who among us has the capacity to govern someone else? Using the temporary authority granted by the people, an increasing number lately have sought to control the means of production, as if this could be done without eventually controlling those who produce. Always this is explained as necessary to the people’s welfare. But, “The deterioration of every government begins with the decay of the principle upon which it was founded” [Montesquieu]. This is as true today as it was when it was written in 1748.

Government is the people’s business, and every man, woman and child becomes a shareholder with the first penny of tax paid. With all the profound wording of the Constitution, probably the most meaningful words are the first three: “We, the People.” Those of us here today who have been elected to constitutional office or legislative position are in that three-word phrase. We are of the people, chosen by them to see that no permanent structure of government ever encroaches on freedom or assumes a power beyond that freely granted by the people. We stand between the taxpayer and the tax spender.

It is inconceivable to me that anyone could accept this delegated authority without asking God’s help. I pray that we who legislate and administer will be granted wisdom and strength beyond our own limited power; that with Divine guidance we can avoid easy expedients, as we work to build a state where liberty under law and justice can triumph, where compassion can govern, and wherein the people can participate and prosper because of their government and not in spite of it.

The path we will chart is not an easy one. It demands much of those chosen to govern, but also from those who did the choosing. And let there be no mistake about this: We have come to a crossroad, a time of decision and the path we follow turns away from any idea that government and those who serve it are omnipotent. It is a path impossible to follow unless we have faith in the collective wisdom and genius of the people. Along this path government will lead but not rule, listen but not lecture. It is the path of a Creative Society.

A number of problems were discussed during the campaign, and I see no reason to change the subject now. Campaign oratory on the issues of crime, pollution of air and water, conservation, welfare, and expanded educational facilities does not mean the issues will go away because the campaign has ended. Problems remain to be solved and they challenge all of us. Government will lead, of course, but the answer must come from all of you.

We will make specific proposals and we will solicit other ideas. In the area of crime, where we have double our proportionate share, we will propose legislation to give back to local communities the right to pass and enforce ordinances which will enable the police to more adequately protect these communities. Legislation already drafted will be submitted, calling upon the Legislature clearly to state in the future whether newly-adopted laws are intended to preempt the right of local governments to legislate in the same field. Hopefully, this will free judges from having to guess the intent of those who passed the legislation in the first place.

At the same time, I pledge my support and fullest effort to a plan which will remove from politics, once and for all, the appointment of judges … not that I believe I’ll be overburdened with making judicial appointments in the immediate future.

Just as we assume a responsibility to guard our young people up to a certain age from the possible harmful effects of alcohol and tobacco, so do I believe we have a right and a responsibility to protect them from the even more harmful effects of exposure to smut and pornography. We can and must frame legislation that will accomplish this purpose without endangering freedom of speech and the press.

When fiscally feasible, we hope to create a California crime technological foundation utilizing both public and private resources in a major effort to employ the most scientific techniques to control crime. At such a time, we should explore the idea of a state police academy to assure that police from even the smallest communities can have the most advanced training. We lead the nation in many things; we are going to stop leading in crime. Californians should be able to walk our streets safely day or night. The law abiding are entitled to at least as much protection as the law-breakers.

While on the subject of crime … those with a grievance can seek redress in the courts or legislature, but not in the streets. Lawlessness by the mob, as with the individual, will not be tolerated. We will act firmly and quickly to put down riot or insurrection wherever and whenever the situation requires.

Welfare is another of our major problems. We are a humane and generous people and we accept without reservation our obligation to help the aged, disabled, and those unfortunates who, through no fault of their own, must depend on their fellow man. But we are not going to perpetuate poverty by substituting a permanent dole for a paycheck. There is no humanity or charity in destroying self-reliance, dignity, and self-respect … the very substance of moral fiber.

We seek reforms that will, wherever possible, change relief check to paycheck. Spencer Williams, Administrator of Health and Welfare, is assessing the amount of work that could be done in public installations by welfare recipients. This is not being done in any punitive sense, but as a beginning step in rehabilitation to give the individual the self-respect that goes with performing a useful service.

But this is not the ultimate answer. Only private industry in the last analysis can provide jobs with a future. Lieutenant Governor Robert Finch will be liaison between government and the private sector in an all-out program of job training and education leading to real employment.

A truly great citizen of our state and a fine American, Mr. H.C. McClellan, has agreed to institute a statewide program patterned after the one he directed so successfully in the “curfew area” of Los Angeles. There, in the year and a half since the tragic riots, fully half of the unemployed have been channeled into productive jobs in private industry, and more than 2,600 businesses are involved. Mr. McClellan will be serving without pay, and the entire statewide program will be privately financed. While it will be directed at all who lack opportunity, it offers hope especially to those minorities who have a disproportionate share of poverty and unemployment.

In the whole area of welfare, everything will be done to reduce administrative overhead, cut red tape, and return control as much as possible to the county level. And the goal will be investment in, and salvage of, human beings.

This Administration will cooperate with the State Superintendent of Public Instruction in his expressed desires to return more control of curriculum and selection of textbooks to local school districts. We will support his efforts to make recruitment of out-of-state teachers less difficult.

On the subject of education… hundreds of thousands of young men and women will receive an education in our state colleges and universities. We are proud of our ability to provide this opportunity for our youth and we believe it is no denial of academic freedom to provide this education within a framework of reasonable rules and regulations. Nor is it a violation of individual rights to require obedience to these rules and regulations or to insist that those unwilling to abide by them should get their education elsewhere.

It does not constitute political interference with intellectual freedom for the taxpaying citizens who support the college and university systems to ask that, in addition to teaching, they build character on accepted moral and ethical standards.

Just as a man is entitled to a voice in government, so he should certainly have that right in the very personal matter of earning a living. I have always supported the principle of the union shop, even though that includes a certain amount of compulsion with regard to union membership. For that reason it seems to me that government must accept a responsibility for safeguarding each union member’s democratic rights within his union. For that reason we will submit legislative proposals to guarantee each union member a secret ballot in his union on policy matters and the use of union dues.

There is also need for a mediation service in labor management disputes not covered by existing law. There are improvements to be made in workmen’s compensation in death benefits and benefits to the permanently disabled. At the same time, a tightening of procedures is needed to free business from some unjust burdens.

A close liaison with our congressional representatives in Washington, both Democratic and Republican, is needed so that we can help bring about beneficial changes in Social Security, secure less restrictive controls on federal grants, and work for a tax retention plan that will keep some of our federal taxes here for our use with no strings attached. We should strive also to get tax credits for our people to help defray the cost of sending their children to college.

We will support a bipartisan effort to lift the archaic 160-acre limitation imposed by the federal government on irrigated farms. Restrictive labor policies should never again be the cause of crops rotting in the fields for lack of harvesters.

Here in our own Capitol, we will seek solutions to the problems of unrealistic taxes which threaten economic ruin to our biggest industry. We will work with the farmer as we will with business, industry, and labor to provide a better business climate so that they may prosper and we all may prosper.

There are other problems and possible problems facing us. One such is now pending before the United States Supreme Court. I believe it would be inappropriate to discuss that matter now. We will, however, be prepared with remedial legislation we devoutly hope will be satisfactory to all of our citizens if court rulings make this necessary.

This is only a partial accounting of our problems and our dreams for the future. California, with its climate, its resources, and its wealth of young, aggressive, talented people, must never take second place. We can provide jobs for all our people who will work, and we can have honest government at a price we can afford. Indeed, unless we accomplish this, our problems will go unsolved, our dreams unfulfilled and we will know the taste of ashes.

I have put off until last what is by no means least among our problems. Our fiscal situation has a sorry similarity to the situation of a jetliner out over the North Atlantic, Paris-bound. The pilot announced he had news, some good, some bad, and he would give the bad news first. They had lost radio contact; their compass and altimeter were not working; they didn’t know their altitude, direction or where they were headed. Then he gave the good news – they had a 100-mile-an-hour tail-wind and they were ahead of schedule.

Our fiscal year began July 1st and will end on the coming June 30th, six months from now. The present budget for this twelve-month period is $4.6 billion, an all-time high for any of the fifty states. When this budget was presented, it was admittedly in excess of the estimated tax revenues for the year. It was adopted with the assurance that a change in bookkeeping procedures would solve this imbalance.

With half the year gone, and faced now with the job of planning next year’s budget, we have an estimate provided by the experienced personnel of the Department of Finance. We have also an explanation of how a change in bookkeeping could seemingly balance a budget that called for spending $400 million more than we would take in.

Very simply, it was just another one-time windfall, a gimmick that solved nothing but only postponed the day of reckoning. We are financing the twelve-month spending with fifteen-month income. All the tax revenues for the first quarter of next year, July, August, and September, will be used to finance this year’s expenses up to June 30th. And incidentally, even that isn’t enough, because we will still have a deficit of some $63 million.

Now, with the budget established at its present level, we are told that it, of course, must be increased next year to meet the added problems of population growth and inflation. But the magic of the changed bookkeeping is all used up. We are back to only twelve months’ income for twelve months’ spending. Almost automatically we are being advised of all the new and increased taxes which, if adopted, will solve the problem. Curiously enough, another one-time windfall is being urged. If we switch to withholding of personal income tax, we will collect two years’ taxes the first year and postpone our moment of truth perhaps until everyone forgets we did not cause the problem, we only inherited it. Or maybe we are to stall, hoping a rich uncle will remember us in his will.

If we accept the present budget as absolutely necessary and add on projected increases plus funding for property tax relief (which I believe is absolutely essential and for which we are preparing a detailed and comprehensive program), our deficit in the coming year would reach three-quarters of a billion dollars.

But Californians are already burdened with combined state and local taxes $113 per capita higher than the national average. Our property tax contributes to a slump in the real estate and building trades industries and makes it well-nigh impossible for many citizens to continue owning their own homes.

For many years now, you and I have been shushed like children and told there are no simple answers to the complex problems which are beyond our comprehension.

Well, the truth is, there are simple answers, they just are not easy ones. The time has come for us to decide whether collectively we can afford everything and anything we think of simply because we think of it. The time has come to run a check to see if all the services government provides were in answer to demands or were just goodies dreamed up for our supposed betterment. The time has come to match outgo to income, instead of always doing it the other way around.

The cost of California’s government is too high; it adversely affects our business climate. We have a phenomenal growth with hundreds of thousands of people joining us each year. Of course, the overall cost of government must go up to provide necessary services for these newcomers, but growth should mean increased prosperity and thus a lightening of the load each individual must bear. If this isn’t true, then you and I should be planning how we can put up a fence along the Colorado River and seal our borders.

Well, we aren’t going to do that. We are going to squeeze and cut and trim until we reduce the cost of government. It won’t be easy, nor will it be pleasant, and it will involve every department of government, starting with the Governor’s office. I have already informed the legislature of the reorganization we hope to effect with their help in the executive branch, and I have asked for their cooperation and support.

The new Director of Finance is in complete agreement that we turn to additional sources of revenue only if it becomes clear that economies alone cannot balance the budget.

Disraeli said: “Man is not a creature of circumstances. Circumstances are the creatures of men.” You and I will shape our circumstances to fit our needs.

Let me reaffirm a promise made during the months of campaigning. I believe in your right to know all the facts concerning the people’s business. Independent firms are making an audit of state finances. When it is completed, you will have that audit. You will have all the information you need to make the decisions which must be made. This is not just a problem for the administration; it is a problem for all of us to solve together. I know that you can face any prospect and do anything that has to be done as long as you know the truth of what you are up against.

We will put our fiscal house in order. And as we do, we will build those things we need to make our state a better place in which to live, and we will enjoy them more, knowing we can afford them and they are paid for.

If, in glancing aloft, some of you were puzzled by the small size of our state flag… there is an explanation. That flag was carried into battle in Vietnam by young men of California. Many will not be coming home. One did, Sergeant Robert Howell, grievously wounded. He brought that flag back. I thought we would be proud to have it fly over the Capitol today. It might even serve to put our problems in better perspective. It might remind us of the need to give our sons and daughters a cause to believe in and banners to follow.

If this is a dream, it is a good dream, worthy of our generation and worth passing on to the next.

Let this day mark the beginning.

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