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Ray Haynes

Everything That is Wrong With the State Budget, Part 3

In my last two comments on the state budget, I pointed out:
(1) the state budget is based on highly volatile and unstable revenue sources; and
(2) the increase in spending in this budget will lead to significant negative future year budget impacts, that is, we are not far from a budget so unbalanced that it will make the budget crises of the past look like a walk in the park. We will then be told that tax increases are necessary to solve the budget problems, and that it would be “irresponsible” to enact the tax increases. As one of my colleagues noted in the budget crisis that occurred at the turn of the century, “we call them ‘tax and spend’ liberals, but they are really ‘spend and tax’ liberals.” First they spend everything they can put their hands on, then, when the budget collapses from the weight of their spending, they claim they have to raise taxes. Today is when the mistake of overspending occurs, tomorrow is when they use the “excuse” of a budget crisis to raise your taxes. Note this now, in one, two or three years, when the budget collapses, Republicans will be attacked for not voting for tax increases. It happened before. The irresponsible decision making is occurring today, and when those who argued against this spending vote “NO” on the tax increases, they will be the responsible actors, again.

The first problem with the budget is that the Legislature and our Arrogant Lazy Authoritarian in Charge (ALAIC) Newsom failed to comply with state law by having the budget enacted by June 15.

If you will recall, for years the budget required a two-thirds vote to pass, and so needed Republican votes to pass (at least when I was in the Legislature). Not that that requirement meant much, there were always enough Republicans ready to sell out the people of the state of California for budget pork, that is, a small amount of money (mere millions in a multi-billion budget). In the years that we saw the fastest growth in state budgets, a couple of Republicans would get $10 million here, or $5 million there and then vote for a $20 billion increase in overall state spending. “We can afford it” we were told, revenue is growing so fast. That is, until it wasn’t, then we were faced with a $40 billion deficit. By that time, those irresponsible Republicans were termed out, and never faced responsibility for their votes, and the people of the state paid for it.

As Republican voters got smarter, and stopped supporting sell-outs, a two-thirds budget got tougher to enact, and late budgets became the norm. So Democrats put an initiative on the ballot to allow for majority vote budgets. We were also told there would never be another late budget, because legislators would “lose their salaries if the budget was late. I personally supported a majority vote budget, so that the Ds would own the budget outcome and could never again blame Rs for the budget issues, because their votes were not necessary for a budget. I didn’t support the “loss of salary” provisions, because I thought that would create a conflict of interest. One of the reasons I got elected was the promise to reduce government spending. I shouldn’t have to worry about “not getting paid” for doing the job my voters elected me to do.

It turns out, I didn’t have to worry. This year was a great example of how the majority party skirted the “you’ll lose your paycheck” requirements of the “majority vote” budget law. They simply passed a bill, called it the budget, then went to work on the real budget. ALAIC Newsom loved it. Facing a recall, he was able to have multiple press conferences touting the state’s budget, and its record surplus (as he called it), saying at each conference where the “fake” budget was signed that California was “roaring back.”

The Legislature then went about enacting the real budget over the next 5 weeks, calling those bills “trailer” bills. What used to happen (as my first several years in the Legislature demonstrated), the Legislature would enact the budget bill, and on that same day, pass 5 or 6 trailer bills to enact the changes in the law necessary to make the budget work. The trailer bills would usually be divided by policy areas covered by the various state departments, and then change state statutes in accordance with the budget agreement.

After a while, the 5 or 6 trailer bills became 20 to 25 bills, but would still be enacted within days after a budget agreement.

Now, the “trailer bill” process is continuous. This year, by June 15, the Constitutional deadline for a budget enactment, the Legislature approved, and ALAIC Newsom signed, a “fake” budget. There was no agreement, but they called it the budget bill so they would not lose their paychecks. They then continued negotiating the real budget, and passed a number of bills over the next 4 weeks, to implement the agreements they reached. No one could really follow the process, and the media was uninterested in the deception by the ALAIC and Legislative leadership. In the ’90’s and the first decade of the 2000’s, the press was unrelenting in their criticism of Republicans for holding out to reduce spending. Now the press yawns whenever anyone says the Ds are lying to protect their own pocketbook.

So, the next big problem with the budget is the deception. Democrats did not comply with the Constitutional amendment they said would “solve” the budget crises that have occurred over the years. The fact is, once again, we are being lied to.