Posted on 11/04/2010 1:11:59 PM PDT by SmithL
A day after California voters handed state leaders mixed messages on how to manage the budget, the leader of the Senate signaled that lawmakers will reopen negotiations sometime in the next few months to close a new multibillion-dollar deficit.
Senate President Pro Tem Darrell Steinberg, D-Sacramento, told reporters, "It is probably likely there will be a midyear budget session," and said next year's deficit could be as large as $12 billion.
It marks the first public acknowledgment by a leader at the Capitol that the budget deal struck in October to close a $19 billion hole was not solid enough to last the entire fiscal year.
Also Wednesday, Gov.-elect Jerry Brown told reporters that he would begin taking action on the state budget as soon as today.
(Excerpt) Read more at sfgate.com ...
But then, this budget was never intended to last the whole year. It was passed solely to get the legislators back home in time to campaign for this week's election.
Bend over CA taxpayers. Here it comes.
“Jon Coupal, president of the Howard Jarvis Taxpayers Association, said Prop. 25 severely limits the ability of Republicans to impact the formation of state spending plans.”
At the same time, the Democrats no longer have any bipartisan cover for whatever budget they pass.
Here it comes.
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Get ready for riots all around.. and the police and firefighters and state employees being at the front of the pack fighting to keep their pension plans and get fat raises to boot.
This state is sick, nigh incurable. let it croak.
The solution to the CA budget problem is so simple but legislators don’t want to take the political heat for it: the solution is major cutbacks in the vast fraud-infested California Medicaid program. Some analysts estimate that 40% of the cost of that program goes to fraud. This is what happens when government taxes productive people and then provides services to other people almost for free. People want a lot of those nearly free services and the whole system breaks down because of huge cost overruns. That’s where Obamacare will take the entire country if it isn’t repealed soon.
There’s some truth to that but I agree more with the guy who said a simple majority vote will prove to the people that the budget problem isn’t caused by the two thirds majority rule. The majority vote rule should demonstrate that the problem is simply state spending that is way out of line with the already abundant tax revenues collected by state and local government in CA, which is definitely one of the states with the highest taxes in America (even with Prop 13 in place).
The voters just gave the loony left legislature the power to pass any tax it wants with a bare majority vote. We already know that they will never voluntarily cut a dime of spending. So we can be pretty sure of what is coming.
Prop 25 seems pretty bad, but did Republicans every truly have any input on the budget? They always got the budget they wanted through by making side deals with a couple of RINOs, not by actually making real concessions to the Republican caucus as a whole.
The problem is that there will be even higher taxes. There’s nothing to stop them now.
There is one thing that can stop higher taxes: when CA residents refuse to pay them and decide to leave the state instead, like I did early in the last decade. That may be exactly what happens when the Dems try to raise taxes. People will leave the state and the expected increased revenues will never materialize. I still wouldn’t invest a dime in California state bonds—as far as I’m concerned they’re already junk and the ratings agencies are late in downgrading them. CA bonds are turning into a Ponzi scheme where cash from new buyers is used to pay part of the interest on existing bonds. The only way to permanently close the structural budget deficit is to cut state spending as a percentage of California’s GDP and personal income. Eventually I think Scaramento will be forced to finally take a hard look at every program and cut back on the bloated bureaucracies and very costly state programs.
I believe that Prop 26 restores the 2/3rds requirement on taxes. Not sure though.,
Yes. As I understand it, the simple majority rule applies only to the budget.
The two-thirds requirement is for raising taxes — and now “fees.”
So, they can pass all the budgets they want, but the way they’re funded is a bit harder to accomplish — that is if I understand this correctly.
This is a common misconception. Actually, voters made it more difficult for the Dems to raise revenue, not easier. It still takes a 2/3 vote of the Legislature or of the voters to raise taxes (Prop. 13). Prop. 25 doesn't affect that requirement. Prop. 26 added a 2/3 vote requirement for implementing or raising fees, as well as for any "revenue neutral" scheme for raising some taxes but lowering others by a similar amount. And Prop. 22 stopped the state from stealing money from the cities and counties to fund the state budget.
So what Jerry has inherited is a state with a $20bn/year structural deficit, and no way to raise revenue. Also, he and the Dems have sole responsibility for passing a balanced budget, but the only way to do that is to cut spending or persuade 2/3 of the voters to raise taxes on themselves. (The last effort to do that, Prop. 1A in 2009, lost by a 2-1 margin.)
Pass the popcorn, this is going to be fun to watch!
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