Parked Cars
An economic look into Proposition 21
I remember camping trip with my family to the relatively well-visited Patrick’s Point State park when the lady behind the counter at the gift shop approached us with a clipboard and a pen, asking us in the polite, gentle, but albeit aggressive way that only old ladies seem to exhibit, if we would sign a petition. Upon further examination, we discovered that it was a petition for a ballot issue that would, in effect, save the State Parks. What I found out later, after I had signed my soul away, was that it included an eighteen dollar expansion of driver registration fees, which is something that didn’t sit well in my stomach. But it was too late, and the proposition evolved out of petition form, into what we now know as Proposition 21.
At the heart of proposition 21 is the need to better fund the financially failing State Park system of California through a safe and secure means. It is common knowledge that California is facing an absolutely massive budget deficit, and unlike the Federal Government, we don’t have a magic money machine, known by economists as the Federal Reserve, to bail us out. Instead, we have the taxpayers. And that is exactly where this proposition is aimed. It will essentially raise the cost of owning a car by eighteen dollars a year. However, there are real benefits to this somewhat annoying tax hike which include free parking and admission to all state parks for cars that are affected by the surcharge. On top of that nice little bribe, the state also receives a way to securely fund the continued preservation and maintenance of some of the most beautiful places on the planet as well as the environmental benefits that go along with it.
Overall, the proposition is slated to raise $500 million dollars annually for state parks; however, opponents say that the money could be better spent in other areas that are hurting more. Essentially, the opportunity cost of spending the money on parks instead of other things far outweighs the receivable benefits of keeping the parks open, clean, and healthy.
On the other end of the argument, proponents of the proposition cite that the community of California will be rewarded with a slew of environmental benefits that could have a very positive impact on the health of our state. The most substantial and concrete examples of economic benefit from this proposition are cited on a yesforstateparks.com fact sheet and state:
“State parks strengthen the economy by attracting millions of tourists, who spend $4.32 billion annually in park‐related expenditures in California, according to a recent study. It found state park visitors spend an average of $57.63 in surrounding communities per visit. They generate so much economic activity that every dollar the state spends on state parks generates another $2.35 for California’s treasury.”
(http://www.yesforstateparks.com/get-the-facts/fact-sheets/general-fact-sheet)
Taking into consideration the fact that this figure is most likely affected by diminishing marginal returns, it is still a substantial number when coupled with the environmental benefits provided.
However the question still remains whether the returns in this sector would outweigh the returns in something like education. But then one must wonder if Prop 21 were to fail, if any many would be spent in education at all.
Ultimately the decision boils down to the fact that even if any opportunity cost were to yield a higher rate of return for the state and her citizenry, and that is a very formidable ‘if’, would such an opportunity be taken. My intuition says ‘probably not’, but at least it gives us more to consider when we decide we want to raise taxes on ourselves to make up for our budget-inept state legislatures.
With everything said and done, my verdict on this one is a solid ‘Yes’. I’m not a fan of covering up budget inadequacies by simply finding more money to waste, but this proposition does something that the State has been unable to: find a stable way to fund a program. Not just any program, but one of the dearest and, in my opinion, most important environmental programs in California.
An economic look into Proposition 21
I remember camping trip with my family to the relatively well-visited Patrick’s Point State park when the lady behind the counter at the gift shop approached us with a clipboard and a pen, asking us in the polite, gentle, but albeit aggressive way that only old ladies seem to exhibit, if we would sign a petition. Upon further examination, we discovered that it was a petition for a ballot issue that would, in effect, save the State Parks. What I found out later, after I had signed my soul away, was that it included an eighteen dollar expansion of driver registration fees, which is something that didn’t sit well in my stomach. But it was too late, and the proposition evolved out of petition form, into what we now know as Proposition 21.
At the heart of proposition 21 is the need to better fund the financially failing State Park system of California through a safe and secure means. It is common knowledge that California is facing an absolutely massive budget deficit, and unlike the Federal Government, we don’t have a magic money machine, known by economists as the Federal Reserve, to bail us out. Instead, we have the taxpayers. And that is exactly where this proposition is aimed. It will essentially raise the cost of owning a car by eighteen dollars a year. However, there are real benefits to this somewhat annoying tax hike which include free parking and admission to all state parks for cars that are affected by the surcharge. On top of that nice little bribe, the state also receives a way to securely fund the continued preservation and maintenance of some of the most beautiful places on the planet as well as the environmental benefits that go along with it.
Overall, the proposition is slated to raise $500 million dollars annually for state parks; however, opponents say that the money could be better spent in other areas that are hurting more. Essentially, the opportunity cost of spending the money on parks instead of other things far outweighs the receivable benefits of keeping the parks open, clean, and healthy.
On the other end of the argument, proponents of the proposition cite that the community of California will be rewarded with a slew of environmental benefits that could have a very positive impact on the health of our state. The most substantial and concrete examples of economic benefit from this proposition are cited on a yesforstateparks.com fact sheet and state:
“State parks strengthen the economy by attracting millions of tourists, who spend $4.32 billion annually in park‐related expenditures in California, according to a recent study. It found state park visitors spend an average of $57.63 in surrounding communities per visit. They generate so much economic activity that every dollar the state spends on state parks generates another $2.35 for California’s treasury.”
(http://www.yesforstateparks.com/get-the-facts/fact-sheets/general-fact-sheet)
Taking into consideration the fact that this figure is most likely affected by diminishing marginal returns, it is still a substantial number when coupled with the environmental benefits provided.
However the question still remains whether the returns in this sector would outweigh the returns in something like education. But then one must wonder if Prop 21 were to fail, if any many would be spent in education at all.
Ultimately the decision boils down to the fact that even if any opportunity cost were to yield a higher rate of return for the state and her citizenry, and that is a very formidable ‘if’, would such an opportunity be taken. My intuition says ‘probably not’, but at least it gives us more to consider when we decide we want to raise taxes on ourselves to make up for our budget-inept state legislatures.
With everything said and done, my verdict on this one is a solid ‘Yes’. I’m not a fan of covering up budget inadequacies by simply finding more money to waste, but this proposition does something that the State has been unable to: find a stable way to fund a program. Not just any program, but one of the dearest and, in my opinion, most important environmental programs in California.
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