I had an opportunity last week to chat with GOP gubernatorial aspirant Tom Campbell. The former Congressman has a lot of ideas — I asked him to put some of his thoughts into written form for FlashReport readers….
We need to cut spending to balance the budget. I’ve proposed $12.7 billion in program cuts, and $2.7 billion in state employee give-backs. The principal way to cut programs is to bring down eligibility in California for welfare and medical care to federal minimums. In some of these programs, we’re paying out to individuals at substantially above the federal level. In some areas of Medi-Cal health care, California is paying for options that most other states don’t. We just can’t afford that anymore. And we should be careful about attracting people to come to California because they perceive Medi-Cal or welfare benefits to be higher here. We can ask the state employee unions to give back 15% from the contracts they signed in the last three years. Many Californians have had to take pay cuts. State employees should, too. If the union representatives are not able to reach agreement with the Governor on this, then the Governor should use his authority to lay-off or furlough, to achieve the same amount of savings.
Here’s what we should NOT do. There are proposals in the May budget proposal to borrow $1.9 billion from cities and counties, making them pay for the state’s inability to balance the state’s books. That’s not fair. It’s bad governance. If a city has been running its finances frugally, it shouldn’t be viewed as a piggy-bank for the state. And the state has to pay the money back anyway, with interest.
We should not “accelerate” tax payments. That’s also in the current May revised budget proposal–$610 million in one set of proposals, then an additional $1.7 billion in another. The sums would come from increasing withholding on personal income tax and business tax. That’s a tax increase, in the current year. And it creates a hole in the budget for the next year, when those taxes would otherwise have been due.
We should not budget on assumed values of selling assets. One proposal is to sell 1 billion of value in the State Compensation Insurance Fund. If that is the right thing to do on the merits, fine. But we shouldn’t do it just to get some cash in the current environment. And it’s bad budgeting to assume that some insurance company is willing to spend $1 billion dollars for this asset, especially when many insurance companies are in a tough financial situation. Similarly for selling state real estate. We sell it once, and it’s gone for good. It’s terrible budgeting to use one-time sales to fix an on-going problem. Not to mention—it’s the worst market in decades to be selling commercial real estate.
Lastly, we shouldn’t fire any more teachers. I’ve been a teacher since 1983, at Stanford, Cal, and Chapman. That’s my profession. I know I’m a better teacher when I have fewer students in my class. There is much that can be done to make our schools better; no question. We need to insist upon those improvements before we INCREASE school funding. But in the present budget crisis, the proposal is to CUT school funding; it’s the school boards’ decision, and they are announcing teacher lay-offs and larger size classes. That’s particularly short-sighted at the Community College level. That’s where so much retraining takes place, for Californians who have been laid off in this recession, and are trying to develop new skills to get new jobs.
The $15.4 billion I’ve identified, from cuts and state employee give-backs, won’t be enough to balance the budget. (You can see all the details of what I propose to cut on my website at campbell.org.) We’re still $5.8 billion short. I’m not going to call for firing more teachers. I’m not going to cram down costs on cities and counties. I’m not going to shift revenue from one year to the next, or sell assets at assumed prices. That leaves a one-year increase in gas taxes as my proposal for the remaining $5.8 billion needed to fill the budget gap. That would put gas prices at the level they were at the beginning of November, last year. It’s an increase of 32 cents a gallon. Of course, I’d rather not; any tax increase is harmful to our recovery.
However, I think firing teachers is more harmful than a one-year gas tax. In the short run, it’s more harmful at community colleges, for unemployed Californians’ sake. In the long run, in K-12, it’s more harmful where a year with fewer teachers might mean a diminished quality of education that will never be made up. But I don’t like any tax increase. So if you have a better, pragmatic approach, let me hear it, please. Don’t just say we can balance the budget by “becoming more efficient,” or “eliminate waste, fraud, and abuse,” or "we’ll be bailed out by the federal government," or "let’s fire bureaucrats." I’m already proposing $15.4 billion in REAL CUTS. I’m dealing with today’s harsh reality. And I welcome your suggestions for how we can do this better; at campbell.org.
May 23rd, 2009 at 12:00 am
Increasing the gas tax for one year only….hmmm. I find it hard to recall a tax increase that was temporary. Laying off enough state employees to equal the unemployment rate in the private sector seems like a good idea. I need to hear Pozner’s ideas.
May 23rd, 2009 at 12:00 am
LOL…temporary gas taxes. Just like the sales tax and car tax are gonna be temporary right Mr Campbell? Did you not see the results yet of Tuesdays elections Tom? What part of NO do you not understand?
May 23rd, 2009 at 12:00 am
I don’t agree with Tom’s notion that education shouldn’t be cut anymore. It is by far the largest part of the budget and so you have to touch it in some way. Furthermore, a gas tax increase would be regressive and would be a slap in the face to the will of the voters last Tuesday.
That said, I appreciate his honesty. I can respect a man who is willing to offer his views frankly and honestly, even when they aren’t popular. Keep it up, Tom. We need more people like you in politics.
May 23rd, 2009 at 12:00 am
Go away Campbell. Go far away. Politicians like you assisted the liberals in destroying the once greatest state in the nation.
We need to FIRE thousands of teachers and close many-schools, schools which will be sitting empty in Los Angeles because of the stupididty of voters voting for needless classrooms.
Yet this blow-hard wants to raise our taxes!!!
Did this schmuck see what the voters said last Tuesday? We don’t want tax increases!!!
I’d rather see Fienstien or Gov. Moonbeam win in 2010 than have another back-stabbing liberal-Repbulican like Arnold sit in the statehouse in Sacramento.
May 23rd, 2009 at 12:00 am
There was a poll from a Democratic Party leading pollster released last week after Tuesday’s election stating that people want tax increases, but since its a Democratic party leaning pollster, I do not have much trust in the firm. If a poll from a neutral or bipartisan trusted firm such as the Field Institute did the poll and said we need to raise taxes to cover our hide then we would understand the electorate better.
I think people on both parties understand that Proposition 1A was not going to do either what both parties wanted to do. People on the conservative side knew that it was not about a spending cap because it could easily be overriden by raising taxes, while people on the left said it was going to prevent governmental programs from functioning because of the spending caps and it would give too much control to the governor. I dont think Blue Counties were looking at the tax increase issue, they were looking at the state government becoming more disfunctional with 1A.
It is understandable that tax increases once implemented 99.9% never decrease back in our state. But maybe we can add a clause stating that when the budget deficit is closed the authority to keep the tax would be removed.
At least Tom does not believe in stupid shell games in our quest to restore fiscal discipline.
And for Bowden, it seems both Democratic party candidates would put our state in the toilet just as much as Arnold would have.
And to our CRP leaders, how about putting a referendum if a legislator or statewide office holder who strays off the plantation on economics would get 0 money from the organization, maybe that would help keeping our leaders to keep their word.
May 24th, 2009 at 12:00 am
~snort~ temporary taxes.
even worse, is thinking placing more taxes on our already overtaxed gas. what a joke. everything then goes up because of it. what don’t you get about the trucking of products, deliveries and services essential to everyday life?