Dour governor pitches deep cuts

MAY 14, 2010

By STEVEN GREENHUT

At a press conference at 1 pm today, Gov. Arnold Schwarzenegger released a May budget revise that attempts to close a nearly $20 billion budget gap by slashing state welfare programs while maintaining current-year level funding for public schools and even increasing funding for higher education. The governor, in a dour mood, blamed a broken budget system for the tough choices his administration has made.

“The budget should be a reflection of what we in California value most,” he said. This budget does not reflect these values but “we have no choice but to call for the elimination of valuable programs.” The governor pointed to the global economic crisis, which he described as the worst one since the Great Depression. But he focused his ire on a Democratic-controlled Legislature that ignored most of his administration’s proposed budget cuts and which will not embrace reforms that tie budget growth to population and inflation. Instead, the state is on a roller-coaster — as revenues go up and down based on capital gains revenues.

The governor criticized special interests that scream that he is balancing the budget on the backs of the poor, yet who eagerly lobby for additional spending programs during good times that require these cuts when the market goes down. Those special interests also demand higher taxes — something the governor said the state already tried last year. His goal, he said during the question and answer period, is to foster economic growth so that a rebounding economy creates the new revenue that funds these programs.

Meanwhile, angry public employees from the Service Employees’ International Union’s United Health Care workers picketed outside the Secretary of State building and screamed, “We aren’t taking this no more.”

The governor repeatedly mentioned the need for pension reform, noting that the state contribution to backfill generous guaranteed pension deals for SEIU and other employees is crowding out other programs. He said that the California Public Employees’ Retirement System (CalPERS) has demanded an extra $600 million from the state this year — and that the state’s pension contribution’s have gone from $150 million to $3 billion over 10 years.

Here is the Assembly Republican response:

“The Governor’s May Revise lays out a blueprint to close a $19.1 billion budget deficit with no new taxes.  This is a serious spending plan that prioritizes funding and makes difficult but necessary decisions.  Rather than Democrats scrapping this plan and writing a new one that adds spending and taxes, the Legislature should use this plan as the foundation for the final budget,” said Republican Assembly Leader Martin Garrick of Solana Beach.  “New tax increases are off the table with Republicans, no matter how well they are disguised.  Democrats need to join Republicans and act on these spending cuts with urgency.  The clock is ticking for a responsible, on time budget with no new taxes. ”

“There are many government programs that need to be reduced because we simply can’t afford to keep up this spending pace with a $19.1 billion deficit,” said Assembly Budget vice chairman Jim Nielson, R-Gerber. ” We cannot continue California-only health and welfare programs that are not required by the federal government.  We need to look at corrections spending to bring down inmate healthcare costs, and explore whether we can ensure justice and protect the public while housing lower-level inmates for less.  Further reductions in spending on the state workforce are unavoidable.”

Senate President Pro Tem Darrell Steinberg, per the Sacramento Bee, made the following response: “We will not pass a budget that eliminates Cal-WORKS. Outright. We will not be party to devastating children and families. Period. It’s not why we came here, it’s not what we believe in.” Assembly Speaker John Perez said, “The governor’s suggestions are clearly more reflective of a hyper-partisan political agenda than in finding real solutions to our problems. Putting Californians back to work is the fundamental priority for Californians, and we do not have the luxury of another bruising summer of ideological warfare.”

This should be a long hot summer.