The liberal Democrats in Sacramento desperately want to do something, anything to push out and delay having to confront the state’s $24 billion budget shortfall in one package.  They will give anything to get Republicans to approve any stop-gap measures — three billion, five billion, seven billion — they will put up the cuts with "no strings attached" — to tantalize the member of the minority party, who have rightfully complained about the engorged spending of the California welfare state, to support these cuts.

The key here is that there are "strings" attached — as they say, no one ever gives up something for nothing in this business.

The end game for Sacramento Democrats is fairly simple and straightforward — they want to increase taxes as much as possible to close the budget hole — but they know that there is no political appetite for such increases right now in the State Capitol.  With legislative Republicans blocking the 2/3 vote on taxes and the Governor vowing to veto any so-called "majority vote tax increases" — all the Democrats can do is try to buy time.

That is the concession that is made by approving cuts that do not take us completely through the 2009-10 fiscal year — we will "kick the can" into some time later in the new fiscal year.  To a time, when Democrats hope they will be able to get a tax increase through the legislature.

Remember that the further we go into the new fiscal year, the more we’d have to cut to make a difference — yet the less time the cuts would have to go into effect and start producing actual savings to the state.

It seems like there is always a "good reason" to avoid putting off the tough decision in Sacramento.  Today I hear from some Assembly Republicans that we have to make education cuts to this year’s budget or else it means that we’re on the hook for extra spending next year.  That’s what suspending Prop. 98 is for — and also remember that kicking the can into August in and of itself comes with an "opportunity cost" of losing out on a month or two of cuts (the Governor’s proposed FY 09-10 cuts assume a July 1 start date.  If approving the education cuts kicks the can a month, over half of the ed cuts would be offset by lost opportunity to make cuts for July.  If it kicks that can two months, it actually means we would "lose money" by not having implemented real cuts.

Democrats want to delay.  Republicans must not facilitate their need.  GOPers — hold tight and make it clear that when a comprehensive set of cuts is put forward that everyone agrees, if adopted, means that the state can pay its bills through the rest of the 09-10 fiscal year, then its time to put up votes.  Anything short of that is just laying the groundwork for a future major push to raise taxes.

This entry was posted on Saturday, June 27th, 2009 at 12:00 am and is filed under Blog Posts.