Broken Windows, Broken City: Stockton faces pending insolvency and an unraveling social fabric
Where’s a good Occupy protest when you need one? Those scraggly protesters are making mischief on behalf of “the 99 percent” in Oakland, and they’re raging against university tuition increases in San Diego, Los Angeles, and Santa Cruz. Yet as a municipal crisis unfolds in one of California’s former boomtowns, “Occupy Stockton” is nowhere to be found. If the movement cared about ordinary people as much as it claims, it would have plenty to keep it busy in Stockton, where the greed and shortsightedness of the public sector have sent a relatively poor city careening toward insolvency and unraveled its social fabric.
Because California’s municipalities have squandered so much of their budgets on government workers and retired employees, they haven’t been able to provide the essential services that justify government’s existence. Stockton is a case in point. Bob Deis, who took over as city manager in 2010, told reporters recently that the city’s finances resembled a Ponzi scheme. He had never seen the kind of unaffordable health plan that Stockton employees receive: complete medical care for the employee and spouse for life, available, in some rare circumstances, after only a month on the job. “Employee costs are weighing down the city in the wake of a recessionary slump in revenues,” City Journal’s Steve Malanga observed last week. “Stockton has spent the last two years trying to reduce its budget to avoid insolvency. The city has cut about a quarter of its police, but rich pension and health benefit deals still make it difficult for the city to pay its bills… . Employee costs make up 81 percent of the city’s general fund spending.”
Stockton has taken out pension-obligation bonds and followed other California cities in squandering tens of millions of tax dollars on redevelopment projects—in its case, a new minor-league baseball stadium and a waterfront entertainment project—that it hopes will bring an urban renewal. Yet downtown Stockton, despite its beautiful old buildings dating to the Gold Rush era, is largely a ghost town. An ineffective government, which can’t control crime or even keep the streets clean, is the main source of the problem.