For Immediate Release: October 29, 2002

Governor Davis is recognized for his wasteful spending that fleeces Californians

San Francisco, CA — The Pacific Research Institute (PRI) has chosen Gov. Gray Davis for its first California Golden Fleece Award. The award, presented quarterly by PRI’s Center for Entrepreneurship, identifies state or local spending programs or regulations that fleece California taxpayers, businesses, or consumers.

“Gray Davis deserves the first California Golden Fleece Award,” said Dr. Lawrence J. McQuillan, director of PRI’s Center for Entrepreneurship. “He squandered a $12 billion surplus and led the state to the fiscal abyss by engaging in a spending spree that would make a drunken sailor take notice.”

During Davis’s term as governor (1999-2002), California’s state budget has gone from an inherited $12 billion two-year surplus to a $24 billion two-year deficit. Over the past three years, California’s per capita general fund expenditures have jumped by more than 31 percent, while the state’s population grew only five percent. Mr. Davis has also added 34,000 workers to the state payroll during his first three years in office, a greater increase than the next three largest states combined.

Other examples of Davis’s fiscal irresponsibility include:

• Residential and small business electricity customers could pay an extra $5.3 billion over the life of long-term electricity contracts that were negotiated by Governor Davis at above-market prices (The Utility Reform Network).
• The state recently paid for a heart transplant at the Stanford Medical Center for a two-time felon, the cost estimated to be $1 million. The average cost of a heart transplant in the country is just over $200,000. Meanwhile, the Davis administration agreed to spend $122 million a year (when the program is fully phased in over seven years) to improve medical care for state prisoners (Los Angeles Times and Sacramento Bee).
• The FBI estimates that Medi-Cal fraud will eventually total $1 billion (Los Angeles Times).
• The Bureau of State Audits (BSA) reports that state payrolls continue to include the salaries of nonexistent employees – 2,400 phantom workers in five agencies alone with combined salaries of $116 million in fiscal year 2000-01. Agencies move employees among positions to make them appear filled in order to keep their budgets bloated (BSA).
• The federal government assessed a $115.8 million penalty against the state for inept administration of its food stamp program, the most error-plagued program in the nation (Los Angeles Times).
  

The state of California is now spending $24 billion a year more than when Davis first took office. Audaciously, the governor declared, “The problem is not spending. The problem is lack of revenue.” This comment came at a time when Californians send a larger portion of their personal income to Sacramento than ever before.

“California residents next year will likely face the biggest tax hike in the history of any state due to Mr. Davis’s severe budget bungling, overspending, and failure to root out fraud and misuse of taxpayer funds,” said Dr. McQuillan.

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About PRI
For more than two decades, the Pacific Research Institute (PRI) has championed individual liberty through free markets. PRI is a non-profit, non-partisan organization dedicated to promoting the principles of limited government, individual freedom, and personal responsibility.