Gov. Brown advances apparently balanced budget

Gov. Jerry Brown today advanced a budget proposal that apparently is balanced for fiscal year 2014-15, which begins on July 1. It would spend a record $106.8 billion on the general fund, which is up a hefty 23 percent from the $86.8 billion of his first budget three years ago, for fiscal 2011-12.

The new budget includes a $1.6 billion “rainy day fund,” or 1.5 percent of the total.

The budget addresses what the governor has called the “Wall of Debt” run up by the state, currently totaling $24.9 billion. The major items are:

* $6.1 billion in deferred payments to schools, which will be eliminated;

* $3.9 billion for the Economic Recovery Bonds voters approved in 2004, at the insistence of Gov. Arnold Schwarenegger, which will be eliminated;

* $3.9 billion in loans from special funds, which will be reduced by $1 billion, to $2.9 billion;

* $5.4 billion in unpaid costs to local governments and schools for state mandates, which will remain the same;

* $2.4 billion for the under-funding of Proposition 98 for schools, which will be reduced by $600 million, to $1.8 billion.

Spending increase

In a question-and-answer session with reporters, I asked about the $20 billion increase in spending over three years.

The governor replied that most of the new spending is going to pay down the Wall of Debt. “When you pay off that debt, you improve the debt, you don’t make it worse,” he said.

However, the Wall of Debt includes two kinds of debt: First, what it owes to outside entities, mainly bond houses. This is real debt that, if not paid, would slam the state’s credit rating. Paying down the $3.9 billion from the Economic Recovery Bonds really does help the state’s financial position.

Second is what the state “owes” to itself, such as the deferred payment to schools, loans from special funds and under-funding Prop. 98. “Paying down” this kind of a loan really is just more spending. For the fiscal 2014-15 budget, this kind of spending amounts to about $9 billion, mainly the $6.1 billion in deferred payments to schools and community colleges.

Next year, it’s likely that continuing this spending will be demanded of the state by the schools and community colleges. On the positive side, cutting the spending — not including it in the budget for 2016-17 — could be easier because the governor could claim it was just a one-time situation.

CalSTRS

As did last year’s budget proposal, the governor’s 2014-15 proposal acknowledged that the California Teachers Retirement System “estimates that stabilizing the system could cost more than $4.5 billion a year, which could overwhelm other education priorities as well as other policy initiatives.” The proposal advances that, “A new funding strategy should phase in contribution increases for employees, employers, and the state to allow parties to prepare for increased costs.”

It should be noted that “employers” means local taxpayers and “the state” means state taxpayers.

And the budget proposal does not advance a solution. So if the needed $4.5 billion had been included in the budget, it would have devoured all the $1.6 billion rainy day fund and produced a deficit.

In the Q&A, CalWatchdog.com asked about the $4.5 billion needed for CalSTRS. Brown replied that he would be dealing with the problem, presumably if he is re-elected in November. “One way or another, we’re going to pay those teacher pensions,” he said. “This teacher retirement problem is real.”

More spending

Overall, the budget “continues our investment in schools by providing $10 billion this year alone to give California students a much better chance to succeed,” the governor wrote in is introductory words. And in his discussion with reporters, he touted his program of shifting more spending to needier schools.

But the budget does not deal with the problems of the educational policies behind school dysfunction. Spending more money on failed policies will only produce more expensive failures. The latest results from the National Assessment of Educational Progress found, according to the summary in the Mercury-News, “The Golden State’s fourth-graders ranked 47th in the nation in both math and reading. Eighth-graders ranked 45th in math and 42nd in reading. And the scores show that the gap separating white students from their black and Latino peers in English and math is bigger in California than it is nationwide.”

On the positive side, “But amid the dismal news are signs of improvement. California’s eighth-grade reading scores jumped 7 points from two years ago, the biggest gain on that test among the states. Eighth-graders gained 3 points in math.”

But unless such gains continue and even accelerate, the state is going to find that it won’t have the human capital to continue its preeminence in the world of high technology.

17 comments

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  1. LetitCollapse
    LetitCollapse 9 January, 2014, 17:21

    So eighth graders were 42nd out of 50 in reading scores and that’s after a 7 point increase in reading from 2 years ago??? lol.

    Hey, instead of spending gobs of money on the kids the state should fund mandatory classes for their parents and teach the parents the value of education. Force the parent(s) of any kid who is performing unsatisfactory to attend parent education classes. That’s where the problem is: At Home!!!! When the parents discount the value of education why would the kid care??? The kids take on their parent’s values!!! HELLO!!!! Focus on mom and dad. Try that. The other approach has been a complete failure!!! Look at how much money has been given to the California schools over the years and look at the standardized test scores!!! HELLO??? Stop doing the same failed things over and over again and then expect different outcomes!!! HELLO???

    Most of this new spending is going to what they call the “neediest students” like the english learners and those from low income families. So the kids who are actually motivated to learn are punished and the slow learners get rewarded with a disproportional amount of the new funding. Sounds like a typical government program, doesn’t it?

    So if Jose can’t speak english and his parents brought him across the border illegally a year ago he gets a bigger piece of the education pie than does Timmy who lives here legally and plays by all the rules. lol.

    God help this nation of ours. No other nation on the planet operates this way!!!

    Reply this comment
  2. billyBS
    billyBS 9 January, 2014, 18:00

    Many parents value sports for Mikey, Leroy and Maria more than education. Relentless, total ignorance!!! Pile around the TV and watch them run!!!
    What role models for the poor kids. Just incredible. How stupid can people be? As stupid as they want.

    Reply this comment
    • LetitCollapse
      LetitCollapse 9 January, 2014, 21:10

      Yeah, but at least the jocks aren’t out gang bangin and doing drive-bys and flashin their colors. Athletics builds discipline and the ability to work with others to accomplish a common positive goal. Life skills. Plus, it’s a great outlet for guys to blow off all that excess energy post puberty when testosterone floods the body. 85% of the jocks I knew were good kids who stayed out of trouble. Not all were rocket scientists but most did well enough academically to graduate. Sports programs in the schools are an integral part of the learning experience. Naturally, academics should always come first. That’s why they call it ‘school’. At my schools if you were put on academic probation you were done with sports until you corrected the problem. But sports have saved lots of kids from slipping over to the dark side.

      Reply this comment
  3. Ulysses Uhaul
    Ulysses Uhaul 10 January, 2014, 09:04

    Great budget. Pragmatic leader. Could not be happier. Every Doomer should rejoice with this very very conservative budget.

    Reply this comment
  4. billyBS
    billyBS 10 January, 2014, 10:52

    Someone missed the point. Parents are role models not the jocks, neither were the gladiators or chariot riders. Having a Daddy watch 12 hours of football on a weekend is neglect, and a exibition of unfettered ignorance. Sports are extra curricular or should be. Go visit the goals/charter of a Williams College in Massachusetts, a Wesleyan(alma mater of Bill Belichik)in Connecticut. Life(or studing) does not stop on a Saturday because the U has a football game.

    Reply this comment
    • LetitCollapse
      LetitCollapse 10 January, 2014, 11:32

      If dad worked his behind off all week long and is a good provider for his family he has every right to watch 12 hours of football on the weekend if that’s what floats his boat. What’s the difference between dad watching football or mom out shopping with her girlfriends at the malls? Does dad have to slave 40 hours a week M-F then do charity work on the weekend by mowing grass for all the old widows in the neighborhood to be a good role model for junior? Just because dad watches sports it doesn’t mean he doesn’t value education for his kids. I’ve known lots of fathers who love to attend sports events and watch sports on TV who are excellent role models and very involved in their kid’s academic performances. And I personally couldn’t care less what a bunch of high-browers at Williams College of Mass say. I wonder how many sports events Bill Belichik has watched in his lifetime when he could have spent that time with his kids??? lol.

      Reply this comment
  5. Ulysses Uhaul
    Ulysses Uhaul 10 January, 2014, 22:40

    Do you ever sleep?

    Reply this comment
  6. billybs
    billybs 11 January, 2014, 17:04

    I like watching sports as well, looking forward to that when I am dead, that and catching up on rest.

    Reply this comment
  7. Ulysses Uhaul
    Ulysses Uhaul 11 January, 2014, 20:25

    BillyBob

    The sleep mention was not for you….go back to bed.

    Reply this comment
  8. billybs
    billybs 11 January, 2014, 21:21

    U haul, Comment not for you either. Me up by 4 am most days to work out(retired marathoner/endurance competitor still likes to begin day with workout). Not a lot of patience for couch urchins. Life is too short to waste, like spending two days watching tube, unless one is ill or disabled. Wife is teacher in low income area where we live. See all the free crap given,send note home that signature needed got free crap, note comes back next day. Send note home to please sign that homework is reviewed, no response. This is America in 2014. Give me my crap!

    Reply this comment
  9. Ulysses Uhaul
    Ulysses Uhaul 11 January, 2014, 23:55

    BillyBob…..relax…check your meds for reactions/complications…..CWD Doomers chronically paper social engineer how politics and culture as well as human nature should play out….it is futile….like the bullet train…..people like free crap….your neighbors have a job giving out free crap….it will only end when everything turns to crap……

    Reply this comment
  10. Rex the Wonder Dog!
    Rex the Wonder Dog! 12 January, 2014, 00:38

    Our “Wall of Debt” that is still being run up, especially CalSTRS, will NEVER be paid off-ever. Clown knows that and he will just keep running from it until he leaves office.

    The Slow Speed BB Gun train is a good example of how out of touch he is with the average CA citizen and reality,as at least 65% of the state does not want it anymore, might even be 80%, but he is still working the scam in spite of the reality that the average person sees it as a white elephant boondoggle. But he is getting $$ form the unions, and that small minority will destroy any good will he has earned. from by this states citizens

    Reply this comment
  11. Ulysses Uhaul
    Ulysses Uhaul 12 January, 2014, 01:39

    Rexie…..relax little buddy…..you have your trailer, Ramen, Wild Turkey, Ralph’s day olds and Desi and Lucy on your analog Zenith TV.

    Let it Go!

    Reply this comment

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