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Chuck DeVore- Contributor

Assemblyman Chuck DeVore represents 450,000 residents of Orange County California’s 70th Assembly District.. He served as a Reagan White House appointee in the Pentagon from 1986 to 1988 and was Senior Assistant to Cong. Chris Cox. He is a lieutenant colonel in the Army National Guard. Chuck’s novel, CHINA ATTACKS, sells internationally and has been translated into Chinese for sales in Taiwan. [go to DeVore index]

I Know! Let’s Create A New Government Program…
We need more bureaucracy…

[Chuck DeVore] 4/1/05

This year the State of California will spend over $3,000 in your name and in the name of your fellow 35,999,999 Californians. That’s $3,028 of government for you and $3,028 for your spouse and $3,028 for each of your children too, if you have any – that’s $12,112 each year for a family of four.

Within that $12,112 for family of four sits a tremendous amount of bureaucracy, much of it hidden, much of it wasteful, and much of it irrelevant to the typical Californian.

One such bureaucracy is the California Travel and Tourism Commission (CTTC). The CTTC (all good bureaucracies have a snappy acronym) was created in 1995 as part of the California Tourism Marketing Act. The CTTC is funded by an assessment on every firm in the tourism industry with revenue of more than $1 million. These assessments totaled almost $7 million last year. The money it spends is not strictly considered tax money, by how such things are defined in Sacramento.

The CTTC works to coordinate marketing that promotes California’s $80 billion per year tourism industry. This industry, in turn, generates $5 billion in state and local taxes every year while employing 900,000 Californians.

CTTC states that for every dollar it spends, it generates $14 in added travel and tourism revenue. Aside from the difficulty of proving or disproving such a claim, does this in and of itself justify the creation and maintenance of such a state bureaucracy?

Bureaucracies have two constants: they are, as Ronald Reagan said, “The closest thing to eternity we will ever see on earth…” and; once conceived, they tend to grow without much oversight.

A few days ago I witnessed the latter bureaucratic constant as the budget subcommittee upon which I serve voted 3-2 to increase the CTTC budget with $5 million of General Fund tax money – an increase not sought by Governor Arnold Schwarzenegger nor even by the CTTC itself. My Republican colleague and I voted “no” it should be noted, while the three Democrats on the committee voted to spend more tax money.

By the CTTC’s math, this $5 million of taxpayer money should generate $70 million in added tourism revenue. Employing such logic, perhaps we should consider spending $50 billion to promote California in an attempt to balance our budget! The only problem is that every tax dollar “invested” in this program only generates $0.89 in new state and local taxes.

Aside from feeding the CTTC bureaucracy an additional $5 million of tax money, the larger question remains, are the CTTC’s functions a proper role of state government? Might the industry itself operate a program to coordinate its marketing message to the outside world? If it makes sound business sense, why do we need to employ the coercive arm of government to force business owners to file more paperwork?

Lastly, as I recall from my science and math classes in college, there is the concept of the “significant figure” in any discussion numbers that may be difficult to measure with precision. How does this apply to the case of the CTTC? Well, California has an $80 billion travel and tourism industry. The CTTC claims that for every dollar it spends, it adds $14 dollars to the industry, thus, its $7 million budget should add $98 million in tourism spending. It also claims credit for increasing California’s domestic travel market share from 9.7% in 1998 to 11.5% in 2004. Unfortunately, the facts do not back the CTTC’s assertion. The amount of increased tourism spending that can be attributed to the CTTC’s efforts are something on the order of 1/15th of the gain in total tourism spending in the state – not even close to the claimed improvement.

Hence, by CTTC’s own admission, its programs could have only had an imperceptible benefit on the state’s tourism industry – a minuscule benefit that would be more than overshadowed by other factors that drive the travel industry such as foreign currency exchange rates, the increased cost of resort labor due to workers’ compensation and taxes, California’s sky-high airline fuel tax, environmental regulations, and the list goes on and on.

If we really want to get serious about helping California’s travel and tourism industry, as well as every other kind of business in this state, we can do better than spending an additional $5 million on a bureaucracy. Instead, we can let our taxpayers keep more of their hard-earned money. We can finish the job on reforming workers’ compensation. And we can reduce the millions of hours spent every year to fill out government forms to comply with regulations. CRO

copyright 2005 Chuck DeVore




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