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Budget can reclaim the Golden State

Last fall, Californians voted overwhelmingly for a change in direction, and for the first time in California’s 153-year history, a governor was recalled.

The message was clear, no more business as usual.

The new governor, Arnold Schwarzenegger, was given a mandate to pull California back from the brink of financial ruin and put its fiscal house in order.



The governor’s task is to eliminate a colossal budget deficit incurred by past mismanagement of our state finances while avoiding damaging cuts to education, public safety and health and human service programs.

The budget deficit dilemma he inherited stemmed from the previous administration going on a spending binge, while ignoring warnings of an economic slowdown. While revenues increased by 28 percent over the past five years, state spending rose by 43 percent.




The state bureaucracy grew as agencies consistently spent above their budgeted levels.

This led California to face an unprecedented $34.6 billion deficit, the largest in its history. This is appalling when you consider that only a few years ago California’s budget was in the black and running multibillion-dollar surpluses.

Governor Schwarzenegger’s 2004-2005 budget seeks to address California’s current fiscal crisis three ways: no new taxes, reduced spending, and serious government reform.

This prescription seeks to protect the state’s future and to never again allow a similar budget crisis to occur.

It is significant that there are no proposed new taxes. The fact is, Californians are not taxed too little. Government has simply spent too much. Reckless spending and lack of accountability should not be forced upon the taxpayers by asking them to dig deeper into their pockets to pay off a debt they did not create.

New taxes will not force government to make the necessary reductions in spending and growth in government that got us to this point.

The governor’s budget also confronts the overspending problem by calling for about $6 billion of spending reductions. It fairly spreads the savings that will be required across all areas of state government activities. Actual reductions to existing services are modest: cutbacks will mostly affect expanding current services to new non-served clients.

Finally, the proposed budget contains proposals for long-overdue fundamental reform throughout state government. Though these proposals are critical to achieving the long-term savings needed to balance the budget in succeeding years, it will be a balanced effort. Corrections, health and human services, K-12 education, higher education, and the state’s retirement system will be asked to implement reforms to create significant ongoing savings.

Under the reform umbrella of the governor’s budget is an important proposal called the “California Performance Review.” A commission will conduct a comprehensive examination of what government does and how it does it.

The cost-effectiveness of state services, contracting-out current state services, and the state’s procurement process will all be scrutinized to determine where government can cut wasteful spending.

In summary, this is a budget proposal that Californians can be optimistic about. It is a bold proposal that shows real leadership. Though it is not a final budget and needs refinement, it is a good beginning point for a discussion. It is a balanced approach to help alleviate the financial crisis we inherited from the past failed legislative and executive leadership. No doubt it will not be easy and will be uncomfortable for everybody.

That is the nature of solving crises. I am hopeful, however, that working together we can come up with a final solution that truly fixes our overspending problem while maintaining our basic services.

The people of California voted for the recall because they wanted to see change. It will take great cooperation and compromise from all parties to put California on firm financial ground. I am committed to working with Governor Schwarzenegger to enact a budget that is fiscally responsible and holds government accountable.

Rick Keene is the state assemblyman of Chico represents District 3, which includes Nevada County.


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