Daniel Weintraub: Spending limit likely key to any state budget deal

Sacramento Bee ^ | 6/25/8 | Daniel Weintraub

[SmithL]

As he so often does, Gov. Arnold Schwarzenegger now finds himself in the middle between his fellow Republicans and the Democrats in the Legislature, this time on the question of whether California government needs a new spending limit to end its cycle of boom-and-bust budgeting.

Republicans say yes, emphatically. They want a strict limit that would shrink the size of government over time. Democrats say no, just as firmly.

They want no artificial constraints on the power of the purse and say the state's problem is not reckless spending but a chronic shortage of tax revenue.

Schwarzenegger has taken a position that is more nuanced than the legislators' stances from either party, arguing for a measure that would smooth out the volatility in the state's revenue flows. His position is not so much ideological as practical: He wants to end the persistent deficits with a device that's nearly neutral on the ultimate size of government.

How Schwarzenegger is able to navigate between the polar opposites in the Legislature on this question might largely determine not only whether the state gets a spending limit but how the Legislature resolves the immediate crisis presented by a budget shortfall estimated to be in excess of $15 billion. It appears more and more likely that any budget deal to address the short-term problem, especially if it involves new revenue, is going to have to also include some sort of long-term reform that satisfies Republican demands of "never again."

"This state has a spending addiction, and we need to treat it," Senate Republican Leader Dave Cogdill said last week. "We need to find a way to move forward with our budgeting processing in this state so … we don't have to face the prospect of either increasing taxes or slashing services."

[SmithL]

Democrats ... say the state's problem is not reckless spending but a chronic shortage of tax revenue.

Not enough taxes is the Democrat way.

[Dilbert San Diego]

I’m glad I was sitting down to read that. A chronic shortage of tax revenue is the problem? Tax revenues have been growing every year, going back many many years. The problem is that actual and projected spending have grown faster than the tax revenues. It’s not that the revenues has dropped.

Some combination of tax increase and spending cuts will be needed to balance the budget. But it’s so brazen of the Dems. to say that the problem is not enough tax revenue is coming in.

[NormsRevenge]

we already have spending limits..

to borrow from Ripley

Believe it or not. ;-)