Austin Hill

First, let me be clear about this: Contrary to the growing consensus, I am still not convinced that President Obama is destined to be a one-term President.

Despite the colossal rejection of the President’s policies and his “vision” in the midterm election earlier this month (the President himself stated repeatedly before the election that “my name’s not on the ballot, but my agenda is”), I’m still not assuming that he won’t turn things around for himself.

In fact, as it stands now, I think President Obama is more likely to be re-elected than not.

But there’s a present-day crisis on the “left coast,” and most Americans have no idea how bad it is. When more Americans get a grasp of the carnage – and once Barack Obama begins to act-out his natural tendencies towards “government bailouts” - the American electorate may very well become so outraged that the President destroys his own future political prospects.

California – the most populous state in our nation – is bankrupt. Just as is the case in Washington, D.C., nobody in The Golden State dares to say the word “bankrupt” to describe the state government right now, but it is still nonetheless true.

However, since Californians collectively defied the national trend of abandoning the bankrupting Obama-styled economic policies in the recent election, and instead voted for more of the same, the 31st state in our union is now on the fast-track for economic collapse. And it is a crisis that is custom-made for politicians like Barack Obama, who love to spend other people’s money in an effort to make themselves appear heroic.

Outgoing Governor Arnold Schwarzenegger has called a special legislative session for December 6, to deal with the projected $6 billion shortfall in the current fiscal year’s budget. Last week a New York Times article predicted that “deep cuts” in California government programs would result from the session, while Schwarzenegger’s Chief of Staff Susan Kennedy was quoted as saying “There’s no more easy stuff to cut; we are cutting into bone now.”

But neither of these assertions is true. There is no political will in California to cut state government programs (at least not in any substantial way), and “deep cuts” just aren’t going to happen. Similarly, there is plenty of “fat” that could be eliminated from the state budget – a swift cut in the state’s generous unemployment benefits program would make sense – but again, no California politician has the courage to do something so sensible.

So instead, California is accruing $40 million a day in debt, just to keep their unemployment benefits checks flowing. This is the kind of fiscally lethal public policy that has brought down the country of Greece, yet California refuses to do what is necessary – cut government spending – and instead is poised to raise payroll taxes (again) as a means of partially paying for unemployment benefits.

Another example of the horribly self-destructive public policy in California emerged just last week, when the publicly funded Fresno State University was embarrassed with the revelation that the school’s elected Student Body President Pedro Ramirez is an illegal alien. This outraged the local community, which has been embroiled for years in long-standing tensions over illegal immigration.

Yet after being “outed” by the school’s on-campus newspaper, Ramirez made multiple media appearances (including an interview on my own daily radio talk show at Fresno, California’s TalkRadio 105.9, KMJ-FM) assuring people that his enrollment in the school is legal.

As it turns out, Ramirez was mostly accurate. The “California AB 540 Program,” named after “Assembly bill 540” and signed into law by former California Governor Gray Davis in 2001, essentially grants illegal immigrant students the same rights and privileges enjoyed by U.S. citizens at California’s numerous public colleges and universities. In many ways, the educational entitlements for illegal immigrants that would be mandated for all the states if President Obama’s “Dream Act” amnesty legislation were to become law are already mandated in California. Thus, the Golden State of California that is barely keeping school doors open for legal residents is nonetheless required to hold the door open for illegal aliens as well.

So what’s a guy like Barack Obama to do? Politically he can’t afford to do nothing while the “biggest blue state” in the country begins to default on its debts, and he’ll probably find it personally difficult to resist his natural tendencies to “rescue” and “control” things (think G.M. and Chrysler and the many “bailed out” banks). And while there won’t be adequate support in the Congress to legislate an official “bailout” for California, one could envision the President “ordering” the U.S. Treasury to “offer assistance” of some sort, and perhaps trying to “command” revenues out of the private sector and into California government coffers (Mr. Obama had no constitutional authority to “demand” a “settlement” from B.P. oil, but he did it anyway).

But as Americans in the other 49 states learn more about the decades of fraud and waste that has brought about California’s self-induced disaster, the more angry they will become at a President who drives the nation further into debt as a means of “enabling” California’s dysfunction to continue.

California will lapse into some condition of “default,” and President Obama will get involved. The nature of his response could determine his tenure at the White House.


Austin Hill

Austin Hill is an Author, Consultant, and Host of "Austin Hill's Big World of Small Business," a syndicated talk show about small business ownership and entrepreneurship. He is Co-Author of the new release "The Virtues Of Capitalism: A Moral Case For Free Markets." , Author of "White House Confidential: The Little Book Of Weird Presidential History," and a frequent guest host for Washington, DC's 105.9 WMAL Talk Radio.