[September 17, 2008]

EDITORIAL: State financial disaster looms

(Bakersfield Californian, The (KRT) Via Acquire Media NewsEdge) Sep. 17--Who knew? The Governator isn't really a "girlie man" after all. He is standing up to Democratic and Republican legislators, vowing to veto a bogus, irresponsible state budget.

If Gov. Schwarzenegger follows through on his threat, it may be the first time in California history that a governor has vetoed an entire budget.

Democratic and Republican lawmakers contend they have the votes to override the governor's veto. If they do, Schwarzenegger says he will veto hundreds of bills lawmakers have sent him.

The showdown comes as intransigent Democrats and Republicans failed to show the leadership and political courage to responsibly end a record 11-week state budget stalemate. Instead of crafting a balanced budget based on program cuts and increased revenues, this week they passed a scheme of gimmicks and borrowing to close a more than $15 billion state budget gap.

Even Senate President Pro Tempore Don Perata acknowledges the plan moves California closer to fiscal disaster.

While details of the deal are sketchy, here are some highlights:

--It borrows from taxpayers. Beginning in January, an additional 10 percent in state income tax will be withheld from paychecks. Just a "loan," the money will be returned when 2010 state income taxes are filed.

--Corporations and individuals who file quarterly will file earlier. And the ability to write off losses from earlier years will be temporarily suspended.

--Some program funding is cut and some restored.

--Voters will be asked to "modify" and borrow against the state lottery.

Schwarzenegger was denied the budget reforms he demanded specifically increasing the state's "rainy day" fund and securing it. He was given authority to make mid-year budget cuts, not to schools, health or other program funding the bulk of state spending.

Lawmakers passed a "get out of town" budget to allow the state to pay its bills and lawmakers to go home. With many lawmakers also termed out, California's financial house of cards will collapse under the next guy's watch.

"I will not sign a 'get out of town' budget that punishes taxpayers, pushes the problem into the next year and includes fake budget reform," the governor said.

Schwarzenegger is correct to veto this budget. And California taxpayers are correct to be mighty disappointed in their legislators.

It's further evidence of state government's decay. But taxpayers voters must share the blame. They have allowed themselves to be conned into approving ballot measures that increase government services without providing the money to pay for them, and that earmark taxes for special causes, leaving others to go begging.

Decades ago, they approved a scheme requiring a "supermajority" of the Legislature to approve a state budget, allowing a small minority of lawmakers to hold the process hostage. And they approved a term limits plan that has created a Legislature filled with politicians more interested in their next job than in doing their present job.

Until Californians reform their government, they will continue to receive the government they deserve.

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Copyright (c) 2008, The Bakersfield Californian
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