California Budget Reform Fails … Again

Gov. Schwarzenegger's Promises To End "Crazy Deficit Spending" Proving Difficult To Fulfill

(CBS/AP)  Gov. Arnold Schwarzenegger wanted to permanently fix California's "broken budget system." But three times now he has tried and failed to smooth out the state's roller coaster revenues.

Voters on Tuesday resoundingly rejected his latest effort, a package of budget-balancing measures that he promised would provide a short-term patch for the current financial crisis and prevent further catastrophe in the future.

Instead, he now faces a $21.3 billion budget deficit and a budget system that has not changed a bit since he took office nearly six years ago.

"I think he's discovered that this job is a lot harder than he anticipated in a state of economic downturn," Treasurer Bill Lockyer said Tuesday of the governor who came into office in 2003 promising to "end the crazy deficit spending."

The Republican governor faces another tough round of budget negotiations after months spent haggling with lawmakers to close the state's first budget shortfall, which was initially $42 billion through June 2010.

Schwarzenegger will be forced to spend much of his final year-and-a-half in office struggling with the same financial woes that led to the recall of his predecessor instead of enacting the sweeping policy changes he once envisioned.

"The biggest loser would be Arnold," said Dave McCuan, a political science professor at Sonoma State University. "It's time to start looking for a cabinet post in the Obama administration or an ambassadorship someplace warm."

Lockyer said Schwarzenegger and lawmakers will have to reach a new budget agreement quickly, with tax revenue coming in far below projections. Unless a compromise is struck by the end of June, the state could have trouble paying its bills by the end of July.

Political observers say Schwarzenegger and lawmakers will have little choice but to go after even politically sacred programs such as schools. An unusually high two-thirds vote threshold in the Legislature for passing budgets and partisan polarization could combine for a painful summer.

"The choices facing the governor and Legislature are daunting," said Jack Pitney, a political science professor at Claremont McKenna College in Southern California. "Democrats have taken heat for accepting spending cuts. Certain Republicans have taken heat for accepting tax increases, and the heat's only going to get more intense this summer."

Many Californians have been hearing about the state's budget problems but have yet to feel the severity of the crisis. That will soon change, Pitney said.

"For a lot of people, the budget's been an abstraction. But with the next round, there will probably be serious consequences, particularly in the schools," Pitney said.

Last week, the governor said he will consider shortening the school year by seven days, laying off up to 5,000 state employees and taking money from local governments, which likely would translate into cuts to police and firefighting services.

Tens of thousands of teachers also face the prospect of layoffs.

"It has serious consequences for things that people probably don't think about, which is construction projects for example on infrastructure, roads," Julie Sunderland, a supporter of the budget proposition, told CBS News.

"This is a crisis that supersedes all partisan lines, supersedes all public interest lines, frankly. It is so big," Sunderland added.

But Schwarzenegger's warning did not sway voters, many of whom said they did not trust that the ballot propositions would do much to solve California's budget trouble.

"This is a signal by the voters that they are tired of the same old thing, meaning the indecisive decision-making in Sacramento," Willie Pelote, an activist against the proposition, told CBS News.

The majority of registered voters didn't bother to vote at all. Partial results from nearly 70 percent of precincts reporting late Tuesday showed only 19 percent of voters had cast a ballot, according to the secretary of state's office.

Chris Almanza, 55, of Sacramento was among those who chose not to vote, in part because she was angry and frustrated at state lawmakers.

"I'm not going to vote because I don't think it's going to matter," Almanza said.

The governor had particularly championed Proposition 1A, which would have created a stronger rainy day fund for troubled times and capped state spending, while extending a series of tax increases lawmakers approved in February. Those taxes would have brought in about $16 billion to state coffers in future years.

Proposition 1A also was crucial to solving many of the budget problems Schwarzenegger has had to confront in office and help him carve out a legacy for himself.

He reiterated Tuesday that he wanted to be remembered as a fighter for budget reform and said he wouldn't be dissuaded by the overwhelming repudiation from voters.

"I have been working to accomplish this kind of reform since I was elected in 2003 and I will keep working toward it because we cannot allow this harmful and out-of-control budget process to continue," Schwarzenegger said in a concession statement late Tuesday.

The governor planned to return Wednesday from Washington, D.C., where he spent Election Day, to start discussing the grim options with legislative leaders.

[cdegolier]

California is TO BIG TO FAIL. Obama will bailout California.
Posted by tomrobla at 3:36 PM : May 21, 2009

Actually Obama will only help California if SEIU gets its way.

The Services Employees International Union (SEIU) has been in the headlines in recent days for its collusion with the Obama Administration to strip the state of California of its rightful share of stimulus funds.

[cdegolier]

American must be an ignorant Republicon listening to New for Dumb Fox. He does not even know, just like the racist Fox bozos, what socialism is. He could not even say what is wrong with it. I just hope he does not drive on our socialist roads. He better not call our socialist fire or police services. And don't expect the socialist military to protect him or rescue him.

Do these people even realize how frightened and ignorant they sound?
Posted by noloyalisti at 4:06 PM : May 20, 2009

Actually, you are the one who is ignorant, I live in California and he is exactly right.
An analysis of recent census data indicates that the presence of illegal aliens in California is costing the state's taxpayers more than $10.5 billion per year for education, medical care and incarceration.
The report, written by the Federation of American Immigration Reform, or FAIR, states that even if the tax contributions of illegal aliens are subtracted, state government outlays still amount to nearly $9 billion a year.

The $10.5 billion figure translates into a burden to native-born residents of $1,183 per household.

That is BILLIONS IDIOT!! Considering the budget gap is 21 billion, saving 9 billion or more would sure help.

[cdegolier]

When are the idiots running California going to realize when your non taxpayers out weigh your taxpayers you will never catch up. When you provide free social services and benefits to millions of illegals without any compensation your state will go broke.
1. Cut off all illegals from state benefits
2. Deport them (with a record) instead of sending them to jail (depending on the crime)
3. Cut the size of government
4. Cut the non essential programs
5. Cut the state employee's pensions by raising the retirement age and lowering amount
6. Stop cost of living increases and raises for State employees during budget shortages (the rest of us go without raises when times are tough, why not state employees)
7. Raise the amount contributed to medical and dental for state employees. I know teachers in California complained about having to pay $10 per month for medical, boo hoo.

I know state employees will complain about these suggestions, but they need to wake up and look at the real world.

[tomrobla]

California is TO BIG TO FAIL. Obama will bailout California.

[sjc_1]

beach671,

You are one of THE most ill informed people I have ever read online.
You have no idea what you are talking about, you just spew lies that you have made up in your own twisted head.

[beach671]

Ha ha. California is getting what it deserves.

When you become an amnesty State for illegal immigrants that broke into the country and use that new census head count to get more Representatives in Congress to steal money from real citizens of the United States from the extra Federal funds you got with those Representatives....you won't find any pity from the rest of America.

Enjoy your Socialist Democracy led by a fuax Republican that sold his State's citizens out to....non-Americans.

[jonesjep]

Liberal logic at its finest. Michigan decided to massively grow the size of their government which produced a recession long before our current recession. Detroit is a big, dirty, dangerous ghost town. Sounded good to California except on a larger scale. So now California is bankrupt with no way to survive. Still sounds good so now they are going to try it nationwide.

[billpl-2009]

California has become -- "The People's Republic of San Francisco"

[dalelama1]

socialism |?s? sh ??liz?m|
noun
a political and economic theory of social organization that advocates that the means of production, distribution, and exchange should be owned or regulated by the community as a whole.
? policy or practice based on this theory.
Noloyasti, obviously YOU don't know what Socialism is...as you can see it does not refer to the police, military, or fire services which actually all US citizens are willing to pay for...which is why the Left always threatens to cut them first and why you are the Idiot...what is Socialist are the wealth redistribution outlays (welfare, health care, higher than market wages for government employees) and control of the means of production (GM, Cap and Trade, Nationalized Health Care, Refusal to allow efficient energy supplies like nuclear power)...Please educate yourself before calling others idiots as you look at one in the mirror everyday.

[noloyalisti]

American must be an ignorant Republicon listening to New for Dumb Fox. He does not even know, just like the racist Fox bozos, what socialism is. He could not even say what is wrong with it. I just hope he does not drive on our socialist roads. He better not call our socialist fire or police services. And don't expect the socialist military to protect him or rescue him.

Do these people even realize how frightened and ignorant they sound?

[Ichabod09]

Well, if Arnie fails with California, he can always talk with Tom Cruise about doing a remake of Grumpy Old Men.

[american_11-2009]

California the Golden state, is fast becoming the poster child for an bankrupt third world State!

An unholy alliance of Socialist Democrat politicians, Unions, and Illegal Aliens supporters are feasting at the trough of tax payers paid benefits while taxing & regulating business and the tax paying public into poverty.

The pandering of Left Wing Democrat Politicians to their constituency of Illegal Aliens, open border supporters, and unions are driving business and citizens to other states & countries, while leaving the parasites & welfare leeches in an increasing bankrupt, dysfunctional state!

For years California has ignored economics 101 and imported poverty, Criminals and uneducated Peons from Mexico, while exporting business and educated working tax payers. Like all Socialist & Marxist States the results have been an lowing of living standards & bankruptcy.

Failure to abide by our Constitution against invasion & enforce our Immigration laws and constraints on wages and benefits for public employees will result in turning the Golden State into MexiCalif and the end of the California dream!

The policies of Obama and Wash. DC Democrats are intent on following Calif. policies and are resulting in the same creeping socialist process across American. Amnesty & Citizenship as a reward for their invasion of the USA, will result in the rest of the USA turned into a Spanish speaking third world cesspool, modeled on Mexico and follow California into a polluted, over populated, Spanish speaking third world Nation of Crime, Corruption, Poverty, & Misery! This will result in a population depending on Welfare and the Democrat party, thus assuring the lock on power for the Socialist Democrat party of the United States of Mexico!

[noloyalisti]

This is the failed Reaganomics coming home to roost in CA. Favoring big uncaring corporations and rich with some kind of failed trickle-down theories just goes to show what a bad actor clown Schwarzy is. And remember he was present at both the 2004 and 2008 CONS conventions supporting these awful failed conservatives.

Time to repeal the 2/3 budget fiasco or else get rid of the rest of the obstructionist party in the next election. Tell a friend in CA.

[klewt]

Schwarzenegger made a deal with the devil when he met with Enron to plot to recall Davis to clear the way for Enron to continue to siphon off billions of dollars from the California treasury with their rigged rolling blackouts. When you lie down with dogs, you wake up with fleas. He bought his governorship at a very high price and deserves everything he gets! It's just to bad all the citizens of the State also have to pay the price.

[ayatoldya]

Arnold's performance in office is something both Bush and Cheney look upon with proud Republican hearts. Bush only wishes he could have been just as successful as Arnold.

[sjc_1]

The people that complain the loudest about immigration are usually the same people that employ them by the millions to make higher profits. When Reagan signed the law in the mid 80s, he knew darn well his rich Republican friends in California would not have to verify any documents. They could talk out of both sides of their mouths. They hate immigrants but love exploiting them for greedy profits.

[american_11-2009]

Our Politicians keep telling us our Immigration laws are broken and we need an comprehensive solution, which are code words for Amnesty, our Immigration Laws are not broken, they just have not been enforced, what is broken is our Political system when we elect Corrupt/Pandering politicians that puts their desires ahead of the Constitution of USA and the Rule of Law!

Our government fails the most basic and primary task & duty of government, to protect this Nation and its Citizens from invasion and enforce its laws.

They refuse to abide by our Constitution, refuse to enforce our Immigration Laws and refuse to honor their Oath of Office!

Our Government, past & present, Republican & Democrat, have allowed the invasion of 20 to 40 million criminals and uneducated peons which is the largest invasion of any Nation, at any time, by any means & in direct violation of Article IV, Section IV of our Constitution.

This refusal to abide by our Constitution or enforce our Immigration Laws should be classified as Treason of the most foul kind, & as grounds for impeachment & trials for Treason!

Not only have they allowed the invasion, they force American tax payers to pay Billions on Billions of dollars to provide Welfare, Prison cells, Educate the invaders numerous children, and free medical care, at the same time the invading horde break numerous laws and massive document fraud, & are destroying our schools, hospitals, communities, culture and standard of living while Robbing, Raping, Killing & Assaulting American Citizens at an rate the terrorist can only dream about.

Recent statements in Mexico from both President Obama and Secretary of State Hillary something needs to be done. "Our inability to prevent weapons from being illegally smuggled across the border to arm these criminals causes the deaths of police officers, soldiers, and civilians," she said.

But no mention, concern or care that their refusal to stop the Massive Invasion of Illegal Aliens pouring across our borders or enforce our immigration laws that causes an estimated 25 Americans deaths per day and 10,s of thousands victims of Assault, Robberies, Rapes, Identify thief, and other assorted crimes committed by the invading horde of Illegal Aliens from Mexico on American citizens each year!

Most of our Politicians in Wash. DC are wading knee deep in innocent American blood and suffering because they put Politics ahead of the welfare of American Citizens & the future of this Nation! The Welfare vote for the Democrats to further their Socialist Agenda and the Slave Labor for their Pay Masters in the Chamber of Commerce & Business for the Republicans is more important to our Corrupt power mad Politicians than the lives and safety of Americans citizens!

The Citizens of this great Nation have not sacrificed with blood, sweat & tears for over 200 years & obeyed the Laws of the land, paid the taxes, and fought the wars & built this Nation to see Corrupt politicians turn this Nation into the United States of Mexico without a shot being fired, to serve their demented, nefarious goals and lust for power!

[sem042004]

California is a microcosm for the nation. Obama is following the same pattern of spending, unionization, social welfare, environmental regulation and taxation as California. The results will be the same. Nothing has been learned from their folly.

[noloyalisti]

Thank goodness the people of CA have wised up and decided that the Republicon fiscal policies pushed by a bad actor and small minority of corporate-loving right wing extremists is a disaster. It has been a disaster since the last bad actor and now the 2nd worst president of all time, Reagan. Trickle-down, deregulation of corporations and taxpayer welfare for the rich are a fiasco for the people of CA.

[pw08-2009]

Our leaders in California will do anything not to cut state workers who sit in cubicles and do nothing. We always get the threat to cut teachers and firefighters, but what about state office workers? Ove rthe past 5 years, education HAS NOT experienced cut backs in funding, in fact, they have steadily received increases (look at the state budgets yourself). We always hear the teachers unions crying about how it's going to huet the children, yet we spend more per child than any state in the U.S and have a 50% drop out rate for high school children. We need a radical change in our educational system and we need to layoff the cubicle sludge that sits there and does nothing.

Don't worry, our leaders will find other ways to stick it to us with taxes or fees, because they cannot control their repeditive and unnecessary spending habits.