Posted on 12/21/2003 11:56:16 PM PST by calcowgirl
Gov.'s Wins Leave Deficit on Hold
Political triumphs haven't made problems go away.
The state's credit has sagged further and financial pressure has increased.
SACRAMENTO — Arnold Schwarzenegger wins.
Victory has been a constant in the life of the bodybuilder-turned-actor-turned-politician. And it has been the political story of his first month as California governor. Schwarzenegger has shown a knack for fashioning political triumphs: repealing a tripling of the car tax, rescinding a law granting driver’s licenses to illegal immigrants, making a deal with Democrats on a deficit bond and balanced budget constitutional amendment, and deftly going around the Legislature to provide money to local governments.
But as the governor wowed even his critics with this winning streak, the state he leads racked up losses. Two bond agencies downgraded the state’s creditworthiness, pushing the rating on nearly $30 billion in general obligation bonds closer to junk status. Schwarzenegger’s repeal of the car tax boosted next year’s structural deficit — the gap between anticipated revenue and promised spending — from $10 billion to an estimated $15 billion. And his guarantee of money for local governments has increased the financial pressure on the state’s other programs and agencies.
Those two forces — the governor’s appetite for victory and the state’s seemingly intractable problems — have thus far been on separate tracks. Schwarzenegger’s political victories have largely been made possible by delaying any financial reckoning.
(Excerpt) Read more at latimes.com ...
Jean Ross, director of the California Budget Project, a nonprofit that studies the budget, noted that Schwarzenegger’s deficit borrowing plan means that the state, instead of borrowing $10 billion to be paid back over five years as Gov. Gray Davis planned, could borrow $15 billion over as many as 13 years — if voters approve the borrowing on the March ballot.
"The fundamentals have moved in the wrong direction" since Schwarzenegger took office, Ross said.
The total charge paid by California on the five year plan would cost $15 billion. The thirteen year plan will total $15 billion + $20.25 billion financing charge for a total of $35.25 billion. $35.25 billion versus $15 billion. I can readily see where the 13 year plan is going to NOT help California's problem.
No on Proposition 57
No on Proposition 58
You did. You stuck to the issue and did your homework before replying. Thanks.
Above and beyond the petty peeves of this forum...
Merry Christmas to you and the best to you and your family during the holidays.
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