I was an early and ardent supporter of Governor Arnold Schwarzenegger but the compromises he made to achieve a “balanced” budget in 2009 now make me believe that the Golden State elected the wrong celebrity. We should have elected Suze Orman. Only the CNBC talk show host would have the backbone to tell the Legislature and special interests, “Sorry, honey, you can’t afford this. DENIED.”
In a sixty-second TV ad running across California this past week, the Republican governor promises not to raise taxes, and that he, “will not sign a budget that pushes our financial problems down the road, because the road stops here.”
Unfortunately, the Legislative leaders and governor seemed to have used a few billion dollars in deficit financing to build an extension on the financial problems highway that pushes the deficits down the road and into the next administration.
Among the budget “solutions” agreed to by the governor are many gimmicks that take money from future years and use it to balance the 2009-10 budget. And, of course, no one has said how they will account for the gimmickry in future years.
Two billion dollars will be “borrowed” from cities and counties, to be paid back in 2013. That’s two billion-plus that the next governor will have to find.
One billion of the budget balance comes from pushing one round of paychecks for state workers from June 30, 2010 – the end of the current fiscal year – to July 1, 2010, with no word on when or if their paychecks will come in 2011.
Taxpayers also get caught in this mess. Individual withholdings for estimated taxes for 2011 will be taken out of paychecks at an accelerated rate in 2010. Does that mean that the government will collect NO witholdings from personal income taxes the following year? I doubt they could afford that.
This game is not just limited to revenues. Even the vaunted $16 billion in “cuts” involve kicking the can along the budget-balancing highway. For example, the compromise proposes not buying any new textbooks for K-12 schools for five years, yet takes all of the savings in 2009.
Governor Schwarzenegger asks us to “Stand up for California,” in his ads, when it looks like he was using crutches – at best – in the budget negotiations he held with the legislature’s Democrats.
The basic problem in California is that we want to spend more money than we have. In fact, it seems to be an epidemic in America. Some blame our budget mess on Proposition 13, which limits property tax assessments; others cite Proposition 98, which sets school funding levels on auto-pilot.
Everyone has a favor budgetary whipping boy. What we really need is a firm matronly voice telling us, “Sorry, honey, you cannot afford that!” We need Suze Orman to stand up to the legislature and tell them their credit card is DENIED.