Budget Deficit Monkeying With Best Laid Plans

by Julia Rosen [courtesy of Working Californians blogs]

This year was supposed to be the year of health care reform. Next year was supposed to be the year of education, or so pronounced he of the grandiose titles and ambitions: Arnold Schwarzenegger. And you know what, we really need to have our state government make some headway on those issues. Unfortunately, we have a big pressing problem, the huge budget deficit. Health care negotiations have bogged down as the budget gap has risen.

Now Arnold is calling a fiscal emergency. Even prior to that came this LAT article:

Legislative leaders said Thursday that more taxes would be needed to fill a projected $14-billion budget gap next year, and the state Senate president said a healthcare overhaul -- Gov. Arnold Schwarzenegger's priority this year -- will have to wait.

Assembly Speaker Fabian Nuñez (D-Los Angeles) said lawmakers would have to consider raising a host of taxes, including those on Internet purchases and on foreign companies that do business in California.

"We've got to close those tax loopholes," Nuñez told reporters at a news conference. "We can generate billions by doing that."

Senate President Pro Tem Don Perata (D-Oakland) said some sort of tax increase would be necessary, mostly likely in a ballot measure for the public to consider. He said he doubted Republicans would provide the votes necessary for the Legislature to raise taxes.

Raising taxes in California requires a 2/3rds vote and the Republicans are simply calling for more cuts across the board. Those two desires are incompatible, thus there will be a predictable bloody battle to get the budget down.

Nunez thinks they are close enough on health care to call a vote next week. Perata is signaling that he won't go along and is pushing a water bond. Arnold wants cuts, health care and the moon. Republicans don't want anything but a smaller government.

Yes, I am pessimistic this Friday, but I think it is understandable when looking at the situation. The system is dysfunctional right now and I am not confident that they will be able to do the hard work to fix the fundamental problems.