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S&P to Desperate Davis: More Budget Cuts Needed!!!

Ernesto... has this been posted yet? Looks like the bondage bamboozle is about to bust!!! BOHICA!!!

Hay, Gray... Standard & Poors think yer purdy poor!!!

Even if the State assessed each of us men, women and children an extra $1/day, it would take almost 2 years to retire this deficit! The magnitude is awsome!!!

Good find Waspman. Thanks.

S&P: More budget cuts needed

The $10.2 billion of proposed mid-year budget cuts that California Gov. Gray Davis has placed before a special session of the state Legislature are "only a start toward solving the state's massive structural budget deficit," Standard & Poor's said Thursday.

In its report, the financial rating service noted some sticking points:

"The governor did not propose tax increases beyond miscellaneous fee increases;"
Of the proposed $3.4 billion "of budget-closing actions attributable to fiscal 2003, only $2 billion represent actual cuts in ongoing expenditures;"
Although Davis has proposed $6.6 billion of cuts in fiscal 2004, "the structural budget deficit will be $12 billion to $16 billion;"
Many of the governor's proposed gap-closing measures "will be politically difficult to achieve, although not impossible;"
The proposed cutbacks in K-12 education funding "do not appear to be of a level to create serious concerns for K-12 school 2003 cash flow debt, but further cuts in 2004 may pressure local school district fund balances, which could lead to eventual rating downgrades."

Credit analyst David Hitchcock said "Making mid-year cuts while they are still available to be made appears prudent. However, the magnitude of the cuts needed indicate that a substantial operating deficit would still remain in fiscal 2003."