Because we all know Republicans never squander money needlessly…. or conspire to screw people out of their money….
Mish’s Global Economic Trend Analysis
Gov. Arnold Schwarzenegger said Friday he will declare a “fiscal emergency” in January to give him and the Legislature more power to deal with the state’s growing deficit.
The shortfall is not $10 billion, but more than $14 billion — a 40 percent jump that would put it in orbit with some of the state’s worst fiscal crisis, those who have met with him said.
A fiscal emergency would trigger a special session and force lawmakers and the governor to begin addressing the shortfall within 45 days.
“What we have to do is fix the budget system. The system itself needs to be fixed, and I think that this is a good year, this coming year, to fix it,” Schwarzenegger said in Long Beach, where he was promoting his plan for health care reform.
California is struggling with shrinking state tax revenue from the meltdown of the subprime housing market and the credit crunch on Wall Street.
State spending also has increased by more than 40 percent since Schwarzenegger took office after the 2003 recall of then-Gov. Gray Davis.
Gee, Arnie, maybe you could cut back on your travel budget for a start….
5 Responses
I wish him well fixing the economy. Hopefully he will be able to pull the rest of the world out of the global fiscal crisis too…
I must be a complete dummy. I never have figured out how states get behind. Don’t spend what you don’t have.
Actually, I think the real problem is that somehow State expenditures always inflate at a rate higher than the general rate of inflation. This is mostly because people slopping at the public trough get higher salaries, and more generous benefits than people employed in the private sector.
Well California has special problems because of prop 13. Property taxes never keep up with state expenses, so the state is always in boom or bust conditions now.
It’s pretty sad, since what gets cut is usually education or health programs. The state used to have top education and health care, now it is in the 40s.
But hey, all the McMansion owners have low taxes! Yippy.
It leaves one to wonder: since the nation/state of California doesn’t have to maintain a vast military/defense establishment, just what the hell does it spend its revenue on?
The phrase “property taxes never keep up with state expenses” puzzles me. Apparently, in that State (and others running in the red, and lets not forget the feds) all sources of revenue, not just property taxes, never keep up with government expenses. Controlling expenses just seems to be a concept beyond modern governments in our nation. It is any wonder the people don’t want to trust them with additional revenue?
Here’s a question: what portion of the revenues received by the State of California go to maintaining the State government itself? I refer here to salaries, benefits, perks, buildings, etc. I think it is probably a scary number.
Here’s the budget summary:
http://www.ebudget.ca.gov/BudgetSummary/GRE/1249559.html
Most of it goes to health services and education. The prison budget is pretty huge too.