By Martin Garrick and Dennis Hollingsworth
Special to The Bee
Another budget deadline has come and another has been missed. But it s not because there isn t a budget blueprint on the table that deserves the legislature s attention. Instead of scrapping the governor s May Revise and devising schemes to raise taxes and maintain spending, legislative Democrats should get serious about addressing the overspending at the root of the budget crisis.
The governor released a responsible approach to closing a $19 billion budget hole more than a month ago that will reprioritize and reduce state spending and finally slow the unsustainable growth of state government. The plan identifies state priorities: making sure K-12 education funding is not reduced, and reducing spending in health and welfare programs not mandated by the federal government, without raising taxes.
Lawmakers also must seize this opportunity to reform and fix many of the underlying causes of the state s perpetual fiscal crisis. This includes reforming a state pension system that has seen a 2,000 percent cost increase to the public over the past 10 years.
This reform alone could save $110 billion over the next 30 years. Pension reform is a critical issue that must be addressed in this year s budget discussions.
It s also time once and for all to place a strict spending cap in thestate constitution, and strengthen the rainy-day fund to help keep the budget balanced even when revenues decline. Such a reform would ensure that we save sufficiently during the good times so we can better protect priorities like education and public safety during bad times.
Unfortunately, legislative Democrats have rejected these sensible approaches, and introduced vastly differing budget plans. They want to increase state spending and debt, and to raise taxes by billions of dollars on working Californians. Their primary motivation is to protect government jobs. The 38 million Californians who don t work for the government should matter just as much as the 350,000 state employees who do.
Assembly Democrats reject all but $1.2 billion of the governor s spending reductions needed to close the deficit.
Instead, they want to borrow $9 billion to give cash to welfare recipients and to increase government spending, and pay it back by increasing the cost of gasoline. With interest, this loan will cost taxpayers $21 billion over 20 years to pay for one-time spending this year.
Senate Democrats want to raise $5 billion in taxes on income, cars, kids, beer and wine, and job creators. Their idea of budget reform is to push state-mandated programs onto counties and cities, and then make it easier for special interests to pressure local voters to raise taxes on themselves.
At least 2.3 million people are out of work, and our economy is still reeling from a steep national recession. State tax revenues are down sharply in spite of historic tax hikes last year, and experts predict they ll remain at this reduced level for the foreseeable future.
Tax increases are not the answer. California has the highest sales and gas taxes, and second-highest income tax rates in the nation – and yet the multibillion-dollar deficits persist. Enough is enough.
It s time for Democrats in Sacramento to get serious about balancing the budget. First, all must acknowledge that raising taxes in the midst of a recession is off the table. Second, both parties must work to significantly reduce spending now if we are to balance the current-year budget. Third, Democrats need to work with us in supporting a long-term strategy to address pension and spending reform.
It would be irresponsible to use the budget process as a hammer to shut down the government to force higher taxes, as some legislative Democrats have suggested doing. Real people are affected by the decisions we make on the budget. Passing a budget is an important duty for lawmakers and should not be viewed as a political game.
The governor s no-new-taxes budget and Republican reforms are the best approach to solving California s short- and long-term budget challenges. Taxpayers and the unemployed are counting on Democrats to buck the status quo and the public employee unions, and join with Republicans in passing a budget that doesn t protect government jobs at the expense of hard-working and job-seeking Californians.
