Budget far from ‘fantastic’
California taxpayers paid more than $60 million last year to recall one governor and elect another who promised to straighten out the state’s budget mess, and this is what we get?
In the recall election, Republican Arnold Schwarzenegger told the voters, “What the people want to hear is, are you willing to make the changes?” Politics as usual, he said “is out the window.” When the new governor unveiled his proposed budget in January, he said his predecessor’s budgets “were shell games, using tricks and gimmicks to put off the hard decisions until after the next election cycle.”
What the governor and the Democrat-controlled Legislature gave us this week is similar to what the ousted Gray Davis came up with last year:
• It is late (by at least 26 days and counting.)
• It covers up massive spending with massive borrowing.
• It backs off on every proposed cut in social services, higher education and state employee costs.
Sure, there are no tax increases in there – but that’s something Davis himself probably wouldn’t have dared to propose, given the “throw the bums out” climate of late.
Fiscally conservative Republicans such as Tom McClintock have called the $105.3 billion budget “dangerously out of balance,” and are threatening not to vote for it.
And no wonder. The Los Angeles Times has reported Californians will be paying nearly $231 million in fees for the money we’re borrowing from Wall Street – at rates 40 percent higher than other states, because of our rock-bottom credit rating.
The state’s reserves have shrunk to $400 million, far from the $1 billion envisioned by Schwarzenegger. The administration tries to put on a happy face, saying a growing economy will generate bounteous new revenues. Are you willing to bet on it?
The biggest sticking point was getting cities, counties and special districts (such as the Nevada Irrigation District) to let the state borrow $2.6 billion from them over the next two years in return for repayment with interest and limits on borrowing in the future.
But in a dark omen for Nevada County, the deal also locks into the state constitution a tax formula that big cities love, but which fiscal experts say would pressure counties into favoring big box stores over affordable housing.
Schwarzenegger, who has claimed to be above crony politics, has joined with gleeful Democrats in trying to tell Californians that this budget is, in Hollywood-speak, fantastic.
Please do not insult our intelligence. This budget is a bad compromise. Our state government continues to be in fiscal crisis. We can only hope the governor is also not snowing us when he promises real reforms are on the way.
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