Free Republic

SACRAMENTO -- When it comes to building new roads, schools, sewers and dams, Republicans in the state Assembly are marching to a different drummer than Democratic lawmakers and even GOP Gov. Arnold Schwarzenegger. Led by Kevin McCarthy of Bakersfield, Assembly Republicans have called for setting aside a small percentage of the state budget each year for a pay-as-you-go construction program. By contrast, Schwarzenegger and Democratic legislative leaders are proposing a series of bond issues to borrow the billions needed for a massive public works program. The highlight of Schwarzenegger's state of the state speech last month was a call for...

SACRAMENTO - California would devote more than $35 billion of general fund revenue to public-works projects over the next decade under legislation introduced Wednesday by Assembly Republicans. The "pay-as-you-go" proposal underscores many GOP lawmakers' unease with Gov. Schwarzenegger's plan for the state to sell $68 billion worth of bonds to help finance a sweeping agenda of new roads, schools, and waterworks projects. Assembly Republicans will block any bond plan lacking a pay-as-you-go component, said Assemblyman Russ Bogh, R-Cherry Valley. "This is a top priority. It makes sense to take a portion of our budget and build things instead of borrowing,"...

SAN DIEGO – Councilman Brian Maienschein on Monday outlined a plan to overhaul San Diego's troubled pension system, which is facing a billion-dollar shortfall. He proposed switching the city's retirement system from a defined benefit to a defined contribution plan. Under that system, benefits would be based on how much employees contribute into an investment account. "It is time to replace our outdated pension system," Maienschein said. "Taxpayers cannot afford to continue paying for an archaic pension plan." The switch to a "pay-as-you-go" pension system would give city employees more control over their contributions, including the option of moving assets...

...During the debate, Sen. Kerry... said that he would adopt a "pay-as-you-go" approach to ensuring financial solvency to Social Security. President Bush's response, though apt, needs amplification. ...[P]ay-as-you-go is effective when... we are concerned with surging discretionary spending.... defense, roads and highways, judicial services, and homeland security.... Under pay-as-you-go rules discretionary spending can be increased only if Congress is willing to finance it 100% out of other spending cuts and tax increases. The political undesirability of both financing methods serves to check both higher deficits and growth in the size of the government. On the other hand, the pay-as-you-go approach...