[courtesy of California Progress Report]

By Dave Johnson
Speak Out California

For decades people have been hearing that government "spends too much." They have been hearing that it's spending cuts that we need, not tax increases. They've been hearing that most of the government's money is spent on "waste, fraud and abuse." They've been hearing that it mostly goes to welfare, for people who won't work and sit around all day. They've been hearing that taxes are too high, the highest in the world, the liberals who run the world only want to tax and spend, etc. And no one has been reaching the public with the facts.

And after decades of this here is a surprise: people think the government spends too much, that we need spending cuts not taxes, that the money goes to waste, fraud and abuse -- and welfare and stuff like that. Who would have thought?

But ask for specifics like, "What specifically would you cut and by howmuch?" and you'll get a blank stare. Try that question on a conservative politician some time and you'll get the same blank stare. (Usually accompanied by an exercise commonly known as "the run-around.")

[courtesy of California Progress Report]

By State Senator Sheila Kuehl

This is my third essay on the California budget. My first essay set out some background information on actions taken by the legislature http://www.californiaprogressreport.com/2008/05/first_in_a_seri.htmlto re-balance the 2007-2008 budget given shrinking revenues. The second reviewed the Governor’s budget as he presented it in January of this year. http://www.californiaprogressreport.com/2008/05/second_in_a_ser.html This essay will present the changes made by the Governor in his May revision of the 2008-09 budget, usually referred to as the “May Revise”.

Changes in Projected Revenue

Things went from bad to worse in the new estimates of state revenues projected for the July 1, 2008-June 30, 2009 budget year, which reduced expectations by another 6 billion dollars. Although $7 billion in “solutions” had been adopted to balance the 2007-08 budget (see my second essay for this year), rising costs combined with dropping revenues to widen the shortfall to 15 billion dollars in the latest projections.

Changes in Expenditures

[courtesy of California Progress Report]

By State Senator Sheila Kuehl

This is my second essay on the California budget. The first set out some background information on California’s budget, beginning with the actions taken on the 2007-2008 budget earlier this year. This essay will set out the 2008-2009 budget originally proposed by the Governor in January. Following essays will detail the new budget proposals contained in the May Revision (usually called the May Revise) to the January budget, divided into sections by subject matter along with analyses of the winners, the losers, the false scares, the posturing, and some possible conclusions.

The Governor’s original budget, as introduced in January, for 2008-09

The Governor’s budget seemed to have been introduced with the aim of scaring the lights out of every segment of California. Education was slashed. Parks were to be closed. Health and human services were proposed to be decimated (actually more, as “decimated”, from the root “dec”, means to cut by one tenth). Every department, tasked with enforcing every kind of California law, was proposed for a 10% cut, which would have pretty much guaranteed no serious enforcement at all.

Why so dire? Income

[courtesy of California Progress Report]

By Frank D. Russo

Burning the midnight oil since the release on Wednesday of Governor Schwarzenegger’s proposed “May Revision” of the California budget, the Legislative Analyst’s Office has released just hours ago a 30 plus page report that has good and bad news in it for the Governor. Elizabeth Hill, the analyst who is often referred to as “the budget nun,” is now testifying before the legislature on her report and taking questions.

There’s a lot here, but the bottom line is that the LAO agrees pretty closely with the revenue estimates and expenditure estimates used by the Governor. She says that the Governor’s proposed lottery securitization and sale tax trigger presents “significant risk” and debt and proposes a “slimmed down and more responsible lottery plan” of her own that she says is much less risky for education. She criticizes the Governor’s long term budget reform proposal as locking in the shortfall, threatening legislative authority, and complicating the budget.

[courtesy of California Progress Report]

By Duane E. Campbell
Professor of Education
California State University Sacramento

The California budget is a mess- at least a $15 billion deficit.

About half of California’s schools are in a mess: California’s students rank 48th out of the states in 4th grade reading on the NAEP, 47th in math, and 43rd in science. California ranks 48th in 8th grade reading on the NAEP, 45th in math, and 42nd in science.

That is, our schools are in crisis, particularly our schools serving Black, Latino and economically disadvantaged students. And, after 20 years of “school reform,” there has been no real progress.

So what is proposed in the Governor’s budget? Well first he proposes to cut $4.1 billion from the schools. This will increase class size, eliminate counselors and lead to teacher layoffs. The Governor would also cut health care to some seniors, the disabled, and children.

[courtesy of California Progress Report]

Senate President pro Tem Don Perata made the following remarks today about the Governor’s May Revision to the state spending plan for 2008-09.

“This budget and its reasoning, candidly, is very disappointing. It’s really a budget that is beneath this great state of California. It’s kind of a subprime budget – risky borrowing for what we cannot afford. It’s an admission of failure.”

“The lottery proposal that he unveiled today is the worst kind of market speculation, worse even than the speculation that caused the housing collapse in the subprime debacle that caused millions of Americans to lose their homes.”

“By the way, last year’s budget included the sale of the EdFund. The Governor now has moved that sale two years into the future. I think the reason is the investment banker was Bear Stearns. Bear Stearns, of course, went bankrupt trying to profit off the subprime mortgage industry.”

[courtesy of California Progress Report]

By Frank D. Russo

The Governor spoke briefly this afternoon at 1 p.m. on the May revise of his proposed California budget, took a few questions, and left in a little over 20 minutes. Ne was followed by Michael Genest, his cabinet member who heads the Department of Finance and who is in charge of the details on the budget and who walked reporters through an overview of the budget and took a number of questions from reporters.

The Administration pegged the budget deficit at $17.2 billion and said it would have been $24.7 billion had the legislature not acted earlier this year and made changes and cuts totaling $7.5 billion.

The Governor and Genest frankly admitted that the cuts being made are painful and were difficult choices. Despite the spin being put on the proposals, such as that education is being “fully funded” as required by the state constitutional minimum requirements of Proposition 98, John Laird, the Assembly Budget Chair released a statement and a 46 page report indicating there are $4 billion in cuts to education. There also are severe cuts in health and human services—where 26% of the cuts were proposed by the Governor in areas that include the payments made to Social Security recipients and payments to those who provide in home supportive services to the disabled, aged, and infirm.