Posted on 07/11/2005 12:21:58 PM PDT by NormsRevenge
SACRAMENTO, Calif. - Gov. Arnold Schwarzenegger signed a $117.5 billion California spending plan Monday, avoiding a summer-long showdown with Democrats over the state budget.
The governor's signature on the state budget bill had been expected since the Legislature last week approved a negotiated plan that largely reflected his priorities.
Democrats and Republicans will now focus on this fall's special election. The Republican governor is pushing ballot measures to cap state spending, change how legislative districts are drawn and extend the time it takes teachers to get tenure.
The budget for the 2005-06 fiscal year avoids the borrowing that has plagued the state in recent years and does not raise taxes. It sets money aside to pay off some of the state's debt and increases funding to most programs, including $3 billion more for schools and $1.3 billion for road projects.
"This budget is the result of a lot of hard work and a lot of compromise," Schwarzenegger said. "It is an instrument of good for California."
He signed the bill in the Capitol's rotunda as tourists and state workers milled about. Also looking on were his wife, Maria Shriver, and former U.S. Secretary of State George Shultz, one of the governor's economic advisers.
while the train rumbles down the tracks, out of control.. and the trestle is down just ahead.. :-o
Arnold showing some fiscal conservatism?
It's a steep price tag, but well worth the money when he creates the California Border Patrol.
I think our only hope now is that redistricting proposition, but even then, I doubt seriously it'll pass after the 200 million is spent against it.
that's a lot of money for any government
It's spending is out of control,, and it's all legal, supposedly.
Not a comforting thought, but.. ;-) lol
Be prepared for a new round of Phil Angeledes' "Arnold's hurting kids and teachers" ads that will undoubtedly hit the airwaves any minute.
........Phil Angeledes being the guy who wants to run for Gov in 2006, in case you didn't know.
Tom McClintock's floor speech on the budget:
Senate Floor Speech by Senator Tom McClintock
Regarding SB 77, the Final Budget Vote
I am sorry to interrupt the chorus of self-congratulations, but I feel compelled to state an obvious fact – that this budget is $6 billion out of balance; that the state’s chronic deficit spending is getting worse, not better; and that the growth of general fund spending is growing and not shrinking.
Nor can I join applauding the “painstaking negotiations” that have produced this document. The fact is, in May the Governor proposed spending $88 billion (General Fund), the Democrats countered at $89 billion, and they have now compromised at $90 billion. I suppose it is a blessing that the negotiations didn’t go on any longer.
Let me run through the vital statistics of this spending plan. According to the Legislative Analyst’s Office in June, inflation and population will grow 5 percent and revenue will grow 6 percent. But according to the budget staff analysis, spending will grow by 10 percent. That makes it measurably worse than the plan the Senate rejected on June 15th.
On June 15th, we rejected a $5 billion operating deficit. This budget spends $90 and takes in only $84 -- for a SIX BILLION DOLLAR shortfall – THIS YEAR.
On June 15th, we rejected a 9 percent increase in state spending. This budget is a 10 percent increase – averaging 7 ½ percent over the last two years. Spending increases under the Davis administration averaged 7 percent.
Let me repeat: This budget spends $6 billion more than we take in. Last year we spent $2 billion more than we took in. That means that this year’s operating deficit is THREE TIMES bigger than last year’s.
Now, I’m sorry to throw cold water on the celebration, but that is not progress. That is the opposite of progress.
And yet, once again, we’re told that the budget is balanced. But the blunt truth is that it is only balanced with borrowed funds carried over from last year.
We’re told that there is additional debt repayment in this budget. But listen carefully: you’re using borrowed money from last year to repay borrowed money. That gets you precisely no where.
And by next year, according to the staff analysis, we will have completely maxed out on our Prop 57 credit card and we’ll still be about a billion dollars short. And our cumulative budget deficit will have grown to nearly $30 billion. That’s more than $3,000 in taxes that an average family will be obligated to repay just as surely as the balance on their credit card statement.
IF this budget is adopted today, I believe that it can be safely said that “Never in the field of California finance has so much been owed by so many … because of so few.”
And this is only if everything goes perfectly. And that requires us to ignore the urgent warnings of the Anderson Forecast – and others – that difficult economic times lie directly ahead.
If there is so much as a hiccup in the economy, this state will be plunged into a financial crisis that will make 2003 look like the good old days.
There is, however, one good thing that this budget accomplishes. It makes it absolutely imperative that we restore to the governor the authority that he held from 1939 until 1983 to make mid-year spending reductions without having to return to the legislature.
This authority served this state extremely well until it was bargained away – over my objections, I might add – back in 1983.
Restoring the authority of the governor to halt this state’s chronic deficit spending is at the heart of the “Live Within Our Means Act,” and with the adoption of this budget, it is now about the only thing that stands between our state and financial insolvency. We would be well advised to adopt that measure right here as an adjunct to this budget.
This is my 19th state budget vote. It might surprise many of you to know that I voted to support five budgets in the 1980’s – budgets that were actually balanced and that had prudent reserves. The concept seems almost quaint today. Those were days when we had a Triple-A credit rating and our debt service was 1.3 percent of the budget.
And then in the late ‘80’s we saw the budget process gradually shifted from the legislature to the so-called Big Five. And we began passing budgets that were brazenly unbalanced or that included massive tax increases that brought even bigger deficits as they crushed the economy.
And we are now dragging along the cumulative result of this folly. Some $25 billion of deficit-related general fund debt – growing to nearly $30 billion by next year. Our credit rating is the lowest in the nation and our debt service costs have quintupled as a percentage of general fund spending.
I don’t know how much farther we can go down this road before the state’s credit will be completely exhausted. At that point, we will not only have failed to provide the sound management of our generation’s affairs – but we will also have stripped our children of their ability to meet their generation’s needs as they struggle to repay the mountain of debt with which we have crippled them.
I’m sorry to rain on this parade but those are the facts, and as John Adams said, “Facts are stubborn things.”
Increases funding to most programs, does not increase taxes, does not borrow, pays down the debt. Has California's economy improved that much to make all this possible? Or are property taxes going through the roof along with sales prices allowing this magic to happen? Or are we being lied to by the mainstream socialist press again?
You have heard the old expression that owning a boat is like pouring money down a river . .
McClintock's awesome.
He nailed it.
I guess they're talking real money now.
WA state is following CA's lead.
Thanks Dan for posting McClintock's response.
We can only hope and pray that Mrs. RINOld will convince him to take a "pasadena" on a reelection bid and leaves the option open for McClintock to run and WIN in 2006 just like he would have done in 2003 had RINOld stayed out of the race.
Just as I predicted in 2003
"Vote 4 McClintock or Pay$ the Con$equence$"
and that's exactly what we're doing...
"Has California's economy improved that much to make all this possible? Or are property taxes going through the roof along with sales prices allowing this magic to happen? Or are we being lied to by the mainstream socialist press again?"
All of the above, mostly. The economy is way up from 2003, collections on all taxes are way up, the press is mainly stupid, the information on no borrowing is from the politicians press releases.
Tom McClintock is the only one making any sense regarding budget. 6 Billion in debt and we continue to borrow money to pay borrowed money.
This is the guy who a lot of people want to see as president one day. That is a lot of bread.
Way to get the special interest out of KALEE-FOR-NUH politics (R)arnold. The state is doomed!
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