Perhaps everyone should have been paying closer attention to the message being sent by Senate Republican Leader Dick Ackerman and his caucus during the Summer’s budget stalemate — that California is heading for a fiscal crisis, and that we needed to cut state spending.

Apparently the budget that was approved was smoke-and-mirrors after all.  I think that the credibility of the Governor’s Finance Office and Democrat Legislative Budget staffers are at an all time low, as the ability to have a real balanced budget requires, as an essential component, the ability to make realistic forecasts of projected revenues.  It would appear that projections aren’t just off, but they were grossly underestimated.  Since state spending was set with these projections in mind, every day, week and month that goes by without revising our spending just makes matters worse.

While notable, it is not enough to for the Governor to ask his bureaucratic chiefs to plan for a 10% cut in next year’s budget.  We need to deal with this problem now.  As State Senator Bob Dutton has pointed out, the Governor has the power to call a State of Fiscal Emergency to force legislators to join with him in dealing with this kind of deficit situation. 

The real question is this — given how out-of-line our state revenues are, what state spending is going to be cut between now and the end of June?  Belt tightening for the FY 08-09 budget will be a necessity, but it would be negligent or worse to not reduce spending this budget year, which is less than half-over.

Instead of focusing efforts on how to expand state government’s role in health care, or how to further negatively impact the budget shortfall by pushing for more global warming alarmist measures that will hurt our state’s economy, Governor Schwarzenegger should be appointing an emergency fiscal emergency review panel, and figuring out what cuts in spending he can make unilaterally, and which ones require legislative action…  Then call the legislators into session and focus on the problem at hand…

This entry was posted on Thursday, November 8th, 2007 at 12:00 am and is filed under Blog Posts.