Governor's budget too heavy on fantasy
As Gov. Arnold Schwarzenegger prepares to saddle up for his ride into the sunset, it's apparent that his vision of California's future is as muddled as ever.
The governor's proposed budget -- his final budget as the state's chief executive -- attempts to close an 18-month budget deficit of $20 billion. Like so many state budgets before it, it relies on assumptions, fantasy and misplaced priorities.
Schwarzenegger calls for $8.5 billion in spending reductions, primarily in already-slashed welfare programs, utilizes $4.5 billion in dubious fund transfers and counts on $6.9 billion in federal spending above and beyond one-time stimulus dollars.
The governor's $82.9 billion general fund spending plan assumes no tax increases and allows the temporary hikes in sales and income taxes to phase out in coming months.
We're encouraged that the governor is promising not to further cut funding for K-12 education (aside from a $1.2 billion hit to district administration) and that he proposes small spending increases for higher education.
But the fund transfers he's suggesting, which would help pay for those education spending proposals, are essentially the same sort of transfers that already have been deemed illegal.
The fantasy portion of Schwarzenegger's proposed budget is the $6.9 billion he assumes the federal government will be sending our way. This is the same federal government that's wallowing in debt and clearly dubious about writing checks to a state that seems incapable of correcting its own missteps with the necessary hard decisions.
Schwarzenegger has proposed big tax and budgeting reforms that have merit, but his suggested changes wouldn't go into effect until two fiscal years have passed -- and that's if the Legislature OKs them. In the meantime, the economy lags and yet another massive budget shortfall seems likely.
The governor's spending cuts, brutal as they are, won't be enough. California must find additional sources of tax revenue, at least for the near term, but not enough legislators have the courage to pursue them -- certainly not in an election year, anyway.
Long-range budgeting and tax reforms are also urgently needed in California -- and a constitutional convention may be the only way they can be achieved. But it can't possibly happen quickly enough to save this budget.
At least Schwarzenegger recognizes that California must again start spending more on higher education than on prisons. A state that invests in its own future by giving public colleges and universities the funding they need is a state built to compete and equipped to prosper. That has not been California, not over the past decade, anyway -- and things are getting worse, not better.
Just 30 years ago, 10 percent of the general fund was used for higher education and 3 percent was spent on prisons. Now it's trending the other way: 11 percent is devoted to prisons and 7.5 percent goes to higher education.
Schwarzenegger can be commended for facing up to that reality. But he's in fantasyland in too many other areas.
