California Finally Passes Budget; Governor Cuts More Through Veto


California's governing classes finally pass the latest state budget in a long time, which will leave a spending deficit of at least $10 billion and probably a lot more.

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The L.A. Times wonders if maybe this just isn't the right time for a balanced budget:

As for the deficit, some say this just wasn't the year to wipe it out. Government services have already been sliced by several rounds of brutal reductions. With revenue continuing to plunge, they say, there's a point at which delaying a deficit solution does less harm to the economy than confronting it.

The Sacramento Bee is cynical about what was accomplished:

The $87.5 billion spending plan relies on rosy assumptions about revenues from taxpayers and the federal government, as well as reductions to state worker pay, prisons, and social services.....

State leaders faced a $19 billion deficit that the result of faulty solutions in last year's budget, as well as a prolonged economic downturn and a permanent imbalance between how much California spends and how much it receives in revenues....

In the end, Democrats helped broker a deal between Schwarzenegger and the largest state worker union, Service Employees International Union Local 1000, to establish a lower tier of pension benefits for workers hired starting in mid-November.

After the budget got out of the legislature, over the weekend Gov. Schwarzenegger vetoed-out nearly a billion in spending. Details from HealthyCal.org:

In most cases, the governor explained his line-item vetoes with boilerplate language saying the cuts were necessary to "help bring ongoing expenditures in line with existing resources and to build a prudent reserve."...

[Statewide local] welfare directors said the deletion of $256 million from the CalWORKs budgets means "fewer working families will be able to continue work because of the loss of vital child care services, plunging more children into poverty, while completely undermining the Governor's goals of administering the program with efficiency and integrity."....

Schwarzenegger, in a press conference in Fresno, said he cut nearly $1 billion from the budget in part to satisfy the state's lenders, who, he said, would not advance the state money to operate without a prudent reserve. He said he was willing to take the heat for the cuts because he understood that legislators could not vote for them.
"I said to myself, 'Whatever they can't do, then I will do,'" Schwarzenegger said.

Past City of Angles blogging on the late budget process.

(Photo: Justin Sullivan/Getty Images)

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