Print-Friendly Version    

The debate over the loss of San Joaquin Valley farm jobs due to the drought dominated farm labor discussions in summer 2009. Up to 250,000 acres on the west side of the San Joaquin Valley were fallowed in 2009 as a result of less water being pumped through the Sacramento-San Joaquin river delta to protect fish, prompting protests from farmers and farm workers.

There was hyperbole on both sides, with farmers saying San Joaquin Valley towns will dry up and blow away like tumbleweeds and fishermen calling the Sacramento-San Joaquin river delta a black hole for young fish.

University of California-Davis economist Richard Howitt estimated that the drought would reduce farm revenue by up to $1.6 billion in 2009, eliminating up to 80,000 farm jobs on the assumption that each $1 million loss in farm sales eliminates 50 jobs, that is, $20,000 per job [Howitt later reduced his estimate of reduced revenue to $710 million and 35,000 lost jobs]. Other studies use lower revenue-job loss ratios--12 to 24 jobs lost for each $1 million loss in farm revenue is the most common estimate.

Howitt began with estimates of reduced farm revenue. University of the Pacific Economist Jeffry Michael began with EDD employment data, which show that average annual San Joaquin Valley farm employment peaked at about 200,000 in 1995-96, fell to 165,000 between 2001 and 2004, and has since risen to about 185,000. Meanwhile, San Joaquin Valley construction employment rose from about 45,000 in the mid-1990s to a peak 85,000 in 2005 before falling to 65,000 in 2008.

As nonfarm employment increased, the farm share of total San Joaquin Valley employment fell. In Fresno county, average farm employment of 62,000 in 1996 was 20 percent of average total employment, while average farm employment of 46,000 in 2006 was only 14 percent of average total employment.

Michael estimated that each $1 million reduction in farm revenue resulted in 18 fewer farm jobs, attributing 12,000 lost farm jobs in 2009 to reduced farm revenue. He further assumed that, because farmers were complaining that they were up to 30 percent "short" of labor, the net impact of the drought was reduced because reduced production meant smaller "labor shortages." Finally, Michael emphasized that construction employment fell by 20,000 between 2005 and 2008, so that more of the increase in San Joaquin Valley unemployment was due to reduced construction than the drought.

Reporters visited the 10,000-resident city of Mendota in the northwestern corner of Fresno county to explore the human costs of the drought. Mendota had an unemployment rate of 40 percent in summer 2009, slightly higher than in previous years [local-area unemployment estimates are based on intra-county ratios in 2000, when Mendota had 0.75 percent of Fresno county residents and 2.63 percent of the county's unemployed].

Mendota is in the 600,000-acre Westlands Water District, where 40 percent of the land was fallowed in 2009 because of reduced water deliveries. Westlands began receiving water from the Central Valley Project in 1968, but the removal of 800,000-acre feet for environmental restoration left Westlands with too little water in most years. Mendota's unemployment rate was 2.3 percent in the 1960 Census, 9.8 percent in the 1970 Census, and 21.8 percent in the 2000 Census.

Farmers say that environmental groups are using suits based on the 1973 Endangered Species Act to persuade government agencies and judges to choose fish over farmers, allowing water that could be used to irrigate farm land to flow into the ocean. On August 13, 2009, a thousand protestors, mostly farm workers, were bussed by their labor contractor and farmer employers from the San Joaquin Valley to the office of Representative George Miller (D-CA) in Concord to demand that environmental laws be relaxed to make more water available for agriculture in order to preserve jobs.

California's federal-state water system includes 1,200 miles of canals and almost 50 reservoirs to store and move water from north to south. Legislators in October 2009 considered a package of bills that would create a Delta Stewardship Council to review the California water system and recommend improvements, including conservation measures and a "water conveyance facility" in or around the Delta. Major issues include how many more water storage and conveyance facilities should be built, how much water to save for the ecosystem, and who should pay for both new construction and water diverted to the ecosystem.

After several false starts, the Legislature came close to agreeing on a package of bills aimed at restoring the Sacramento-San Joaquin River Delta and increasing the supply of water available to residents and farms south of the Delta. The keystone of the package is a plan to issue $9 billion in bonds to build at least one more $3 billion dam, restore the Delta, and fortify levies. Every billion dollars in new general obligation bonds adds $65 million a year to the state's debt service.

Water Sales. A May 23, 2009 report concluded that the state environmental water account established in 2000 to improve the Delta ecosystem spent nearly $200 million that mostly benefited water users. The state pumped so much water south during most years between 2000 and 2007 that some Kern county farmers bought water from the state for $88 an acre foot and sold some of it back to the state for $200 an acre foot.

Paramount Farms, with 115,000 acres in Kern county, received about $40 million in benefits from such water sales. Stewart and Lynda Resnick own Paramount, the world's largest pistachio and almond growing and processing operation. Their holding company, Roll International, owns Fiji water, Pom Wonderful pomegranate juice, Teleflora, and the Franklin Mint (sold in October 2006).

The plan was to pump water through the Delta when pumping did not threaten fish and store it in Kern county aquifers. When pumping had to be reduced to protect fish, the stored water would be available. However, Kern county is too far south to receive and store water for most of the San Joaquin Valley, so the extra Delta water was actually stored in the San Luis Reservoir.

In a bid to increase salmon stocks, the largest and most complex dam-removal project ever attempted is planned for the Klamath River, which winds from southern Oregon through the Cascades and Coast Ranges to California's Pacific coast. PacifiCorp, a Portland utility that built four dams on the Klamath between 1918 and 1961 to generate electricity, agreed to turn them over to the federal government for removal after 2020. Under the draft dam-removal plan, Oregon and California ratepayers would pay $450 million for dam removal.

In October 2009, the third of four dams was dismantled on the Rogue River in southern Oregon. The last dam, Gold River Dam, could be dismantled by 2010, returning a 157-mile stretch of the Rogue River to its natural state.

Housing. Farm workers often face high housing costs because most labor-intensive agriculture is in metro counties, where rents can be $1,500 to $2,000 for a two-bedroom unit.

In some places, farm worker camps that were closed are being refurbished and re-opened. In Ventura county, the eight-acre Fillmore-Piru Citrus Association camp originally built for single male workers is being remodeled into 66 two- and four-bedroom apartments for families headed by legal US farm workers who earn less than $35,000 a year. Families will be selected by lottery.

Budget. California got a budget for 2009-10 on July 20, 2009. The $26 billion deficit was closed with a combination of spending cuts, borrowing from local governments and deferring payments. The $16 billion in spending cuts included a $6 billion cut for K-12 schools and a $3 billion cut for higher education; the K-12 funds are to be repaid in the future.

There were three milestones on the route to California's structural deficit. First was Proposition 13 in 1978, which limited local property taxes, forcing the state to raise more revenue and distribute it to schools and local governments. Second was voter approval of Proposition 98 in 1988, which required that at least 40 percent of state general fund spending go to K-12 schools. Third was the dot.com boom that peaked in 2000, when income tax revenue jumped sharply because of stock market gains, prompting sharp increases in spending for schools and health care for the poor.

The state committed the stock boom's income-tax windfall to ongoing programs, assuming that the boom would continue to generate tax revenue. When taxes fell, the structural deficit appeared, and it widened as the economy deteriorated. A majority of the 14-member bipartisan Commission on the 21st Century Economy (www.cotce.ca.gov) in September 2009 proposed that the state reduce the number of personal income-tax rates from six to two and create a new four percent business tax on service providers such as lawyers and business consultants.

The goal of tax reform is to reduce swings in income-tax revenues. Most of California's income-tax is paid by those with incomes of $200,000 or more.

California has an estimated 2.7 million unauthorized foreigners. About $5 billion of annual $91 billion in general fund spending is for services for unauthorized foreigners, including $1.2 billion to educate the estimated 300,000 unauthorized children among the 6.3 million enrolled K-12 schools (most of the children of unauthorized foreigners were born in the US and are citizens), $834 million to imprison 19,000 unauthorized foreigners convicted of crimes ($48,000 a year for each), and $703 million for health care for 780,000 unauthorized foreigners? 70 percent is for emergency health care. Some $640 million a year in welfare grants are paid to US citizen children with unauthorized foreigner parents.

Governor Arnold Schwarzenegger proposed a five-year limit on state welfare payments to the US citizen children of unauthorized foreigners, which would cut off payments of about $472 a month for 48,000 California households headed by illegal immigrants, saving $77 million. Many of these families receive federally funded Food Stamp and other benefits.

California's in-home supportive services program (IHSS) costs about $5.5 billion a year, including $2 billion a year from the state. Schwarzenegger persuaded the Legislature to agree to fingerprint both the elderly and disabled who receive in-home services and the mostly immigrant women caregivers who provide them.

Despite its budget problems, California has become the first state to offer attorneys at no cost to poor people in family law and social justice cases, such as those fighting eviction, loss of child custody, domestic abuse or neglect of the elderly or disabled. The program is financed by a $10 increase in court fees for prevailing parties. Since 1963, poor people facing criminal charges have a constitutional right to an attorney, but the federal government does not provide attorneys to those in civil court.

In August 2009, a federal appeals court ordered the state to reduce its prison population of 150,000 by 40,000 within two years; about 19,000 inmates are unauthorized foreigners, 13 percent. The state is likely to resist the federal order. On the one hand, victims-rights groups oppose early release of convicted criminals, but on the other the state does not have funds to expand the system.

Kim Murphy, "Oregon dam's demise lets the Rogue River run," Los Angeles Times, October 10, 2009. Anna Gorman and Teresa Watanabe, "Illegal immigrants again in the budget spotlight," Los Angeles Times, July 10, 2009. Mike Taugher, "Pumping water and cash from Delta," San Jose Mercury News, May 23, 2009. Michael, Jeffry. 2009. Unemployment in the San Joaquin Valley in 2009: Fish or Foreclosure. http://web.pacific.edu/x30714.xml