Why Calexit is Pure Fantasy

I suggest those who think there’s even a one in a million chance we’ll ever have CalExit instead take a trip to Anaheim and spend a year at Disneyland’s Fantasyland. Even the objections have not gotten to the real reasons it won’t happen, which are, in rough order of importance:

1 — The more than $211 trillion (with a “t”) in U.S. unfunded liabilities, as calculated by Prof. Laurence Kotlikoff of Boston University. This largely is for Social Security, Medicare, federal pensions and military pensions. calexitGiven that California is 12 percent of the USA, our share comes to $25 trillion.

If a CalExit vote makes it to the ballot, every senior citizen will vote against it. So will everyone age 50 or older, as they already get in the mail offers to join AARP.

There’s no way you could de-couple California’s welfare state for seniors and others from that of the United States. No one knows how to deal with that $211 trillion black hole. But who would trust a California People’s Republic to keep any part of its secession bargain, especially when its own pension funds for state workers already are woefully underfunded.

What about when the Soviet Union, Yugoslavia, Czechoslovakia and other countries went splitsville? They all were leaving a communist system that had bankrupted pensions systems, usually by hyperinflating them into penury, so the pensioners got stiffed. Then the newly capitalist countries started from scratch. That’s not the situation with the U.S. pension systems – at least not yet.

There’s a reason why tampering with Social Security is the “third rail” of politics: Seniors want their welfare and don’t want it cut. Ask ex-President George W. Bush how well he did with his 2005 scheme to privatize Social Security.

2 — Then there’s the “regular” federal debt of $20 trillion, the one we hear most often about. California’s share of that is $2.4 trillion. Where’s that money going to come from? It presents all the same problems as No. 1.

3 — The dollar. Truly independent countries have their own currencies. That was one reason Brits voted for Brexit: they saw staying in the EU might mean being forced to ditch the pound, the world’s oldest currency with close to its original value, for the Euro.

So how would California set up a californio, to give the new CalCurrency a name? The Euro might be an example. But it’s really controlled by the Germans, so it’s just an extension of the old deutschemark. Remember how Frau Merkel used the Euro’s power to short-circuit Grexit? She conquered Greece more successfully than Der Fueher.

Given how liberal California is, there also would be a strong bias toward inflating the californio, meaning nobody would want it, instead favoring Yankee dollars, which still would be circulate, much as in Mexican border towns. The main alternative would be to tie the californio’s value to the dollar. Or maybe the Chinese yuan. But that wouldn’t be real independence.

4 — Silicon Valley. The digirati in the Valley and San Francisco use all the USA as a vast testing ground for their products. What works here then is spread around the globe. As part of the USA, the Valley has the same culture, politics and finances as its major test market. If California split off, it would find itself gradually separating from the rump USA, making it harder to figure out what’s going on there.

Given that a CalExit almost certainly would need to be financed by Silicon Valley oligarchs, who now control state politics, their reluctance to do so would make it a non-starter.

5 — The NSA. Formerly called “No Such Agency,” it’s the National Security Agency. As Edward Snowden revealed three years ago, it spys on, and keeps electronic records of, absolutely everything digital that goes on in America, and the world. After the revelations, Congress did precisely nothing about this wholesale violation of the Fourth Amendment “right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures.” Snowden now is in exile in Russia.

In the recent national plebiscite, a decisive factor in Hillary Clinton’s defeat was the drip-drip-drip by Wikileaks of damaging emails from Hillary, her staff and the DNC. Suspected leakers include staff members, Russia and anonymous hackers. But the likely source is elements in the NSA itself worried about her constant warmongering and the need to rein in the unsuccessful Clinton-Bush-Obama hyper-interventionism.

Also notice this. On the campaign trail President-elect Donald Trump promised fresh faces in his administration. But so far he has appointed as National Security Adviser Gen. Mike Flynn, the former head of the Defense Intelligence Agency, and as CIA Director Rep. Mike Pompeo, a member of the House Intelligence Committee. Both appointees have been strong critics of the Obama-Hillary foreign policy of recent years, but strongly back the national security state. Pompeo also has attacked Silicon Valley’s stances on strong encryption.

Yet the Valley itself, including Google, long has enjoyed strong ties and even funding from the intelligence agencies.

There’s no way the NSA, CIA and FBI would let Silicon Valley and the rest of California leave. If it ever came close to happening, CalExit’s major backers and funders would get anonymous threats to release their private emails. And how about a little federal anti-trust action against what have become monopolies or duopolies, as Trump threatened during the election?

6 — President Schwarzenegger. Guess who would be an independent California’s first president? The Austrian muscleman who always wanted to become U.S. president but was barred by his foreign birth. A California People’s Republic’s new constitution would take out that plank in the U.S. Constitution. Would Arnold’s run be impossible? That’s what people said before he was elected governor in 2003. And similar things were said before Trump was elected president on Nov. 8.

Arnold, learning from Trump, would be even more formidable than in 2003. What about all Arnold’s scandals? Brushed off, like Trump’s, with humorous tweets.

As Hillary liked to say, “This is not who we are.” So there will be no CalExit except, to use another theme park analogy, maybe as a ride at the Disney California Adventure Park.

Longtime California columnist John Seiler now writes freelance. His email:writejohnseiler@gmail.com