Lessons that could be learned from California Budget crisis

I hate to say it, but I agree with the initial statement by Robert J. Samuelson in this piece in this week's Newsweek, California's Reckoning—and Ours that the lessons that could be learned from California's budget crisis are ones we will ignore. I've watched some of the problems my city and my state are experiencing, it's already clear no one is listening...That said? For those of us that want the ability to say, "I told you so" -- I recommend reading the article. Part of which:

Here's the national lesson. There's a collision between high and rising demands for government services and the capacity of the economy to produce the income and tax revenue to pay for those demands. That's true of California, where poor immigrants and their children have increased pressures for more government services. It's also true of the nation, where an aging population raises Social Security and Medicare spending. California is leading the transformation of politics into a form of collective torture: pay more (higher taxes), get less (lower services).

On paper, the state could solve its budget problems by raising taxes further. But in practice, that might backfire by weakening the economy and tax base. California scores poorly in state ratings of business climate. In a CNBC survey, it ranked 32nd overall but last in "cost of business" and 49th in "business friendliness." Information technology (Intel, Google, Hewlett Packard) and biotechnology remain strengths, but some traditional industries are struggling. High costs, as well as tax breaks from other states, have caused movie studios to shift production from Southern California. In 1996, feature films involved 14,500 production days in the Los Angeles area, says FilmL.A.; in 2008, the figure was half that.

So California is stretched between a precarious economy and a strong popular desire for government. The state's wrenching experience suggests that, as a nation, we should begin to pare back government's future commitments to avoid a similar fate. But California's experience also suggests we'll remain in denial, prisoners of wishful thinking, until the fateful reckoning arrives in the unimagined future.