America Is Back? What About California, Mr. President?

SACRAMENTO -- California's projected budget deficit has ballooned to $16 billion, much larger than predicted just four months ago, Gov. Jerry Brown said Saturday as he warned of draconian cuts to schools and public safety if voters don't approve his November tax-hike measure. The governor said the shortfall grew from $9.2 billion in January in part because tax collections are sluggish and the economy hasn't recovered as quickly as expected. The deficit also has soared because lawsuits and federal requirements have blocked billions of dollars in state cuts to social programs, Brown said. "This means we will have to go much farther and make cuts far greater than I asked for at the beginning of the year," Brown said in an online video. "But we can't fill this hole with cuts alone without doing severe damage to our schools. That's why I'm bypassing the gridlock and asking you, the people of California, to approve a plan that avoids cuts to schools and public safety." Brown on Saturday did not release details of the newly calculated deficit through mid-2013, but he is set to lay out a revised spending plan Monday. The new blueprint for the fiscal year that starts July 1 hinges in large part on voters approving higher taxes in the fall. Under Brown's tax measure, California would temporarily raise the state's sales tax by a quarter-cent and increase the income tax on people who make $250,000 or more. The bad news announced by Brown puts intense pressure on Democratic leaders, who in January had vowed to fight proposed cuts in Brown's $92.5 billion budget because they believe they would rip apart an already fragile safety net. "We will deal with it," Senate President Pro Tem Darrell Steinberg said Saturday." Steinberg, D-Sacramento, said he wasn't surprised by the deficit spike given that state tax revenues have fallen $3.5 billion below projections in the current year. He and other Democrats, who control the Legislature, have resisted Brown's proposed cuts so far this year. And Republican lawmakers have criticized the majority party for building in overly optimistic tax revenues. "Today's news underscores how we must rein in spending and let our economy grow by leaving overburdened taxpayers alone," Assembly Republican leader Connie Conway said in a statement. Brown proposed $4.2 billion in cuts in January, including $1.4 billion to the state's welfare-to-work program and state-subsidized child care. Brown turned in 1.5 million signatures for his ballot measure Thursday, more than enough to put it before voters. If approved, the new taxes would generate about $7 billion annually. Democrats have already signaled they will reject Brown's proposal to close 70 state parks July 1, promising to find the relatively paltry sum of $21 million in savings elsewhere in the budget to do so. And they are likely to resist major additional cuts to CalWORKs, the state's welfare-to-work program, which has already withstood billions of dollars in reductions. With a solid majority in both houses, Democrats can pass a budget easily, which has robbed Republicans of the power they once had to help shape the budget. But, as they found out last year when Brown vetoed their first budget, Democrats have to craft a plan that meets the governor's approval. Steinberg said Democrats won't put themselves in a similar position this time because they share an interest in producing a balanced, on-time budget. The constitutional deadline for budgets is June 15, though legislators consider June 30, the end of the fiscal year, to be just as viable. "We want to head into November having done our job together with the least amount of fuss and the least amount of fighting," Steinberg said of the fall election."

Support Canada Free Press

VIEW Comments