Town Square

Post a New Topic

The Very Temporary State Budget "Solution"

Original post made by stephen levy, University South, on Aug 3, 2009

The budget adopted by the California legislature last month provides a very temporary solution to the state's continuing budget shortfalls and policy gridlock. The temporary nature of the solution is seen by the frequent use of the terms "assumes," "borrows" and "delays" in the Legislative Analyst's review of the 2009-2010 budget.

This story contains 556 words.

If you are a paid subscriber, check to make sure you have logged in. Otherwise our system cannot recognize you as having full free access to our site.

If you are a paid print subscriber and haven't yet set up an online account, click here to get your online account activated.

Comments (4)

Like this comment
Posted by stephen levy
a resident of University South
on Aug 4, 2009 at 3:19 pm

stephen levy is a registered user.

Hi James,

A while back on your post you asked

"Stephen, what are your opinions?"

More recently you wrote

"I notice that Stephen Levy has posted his opinions, today, on his own exclusive blog. Nevertheless, I would request that he respond to my post, since I responded to his."

You asked for my opinions and then stated that I posted my opinions. Sounds like I did what you asked.

As far as this new "exclusive" dig at my restricted blog, we have gone over this a lot.

Registering takes maybe 3-5 minutes and requires that you give the Weekly your email address. Posting can be anonymous and editing is done by the Weekly. if you have quesions about this ask the editors.

Since people register on and give their email address to lots of commercial sites this does not seem a big barrier to me but possibly it is more than you want to and that is fine.

To clarify another accusation, I think speaking candidly aobut public officials us a great American tradition. I am completely satisfied with the way that the Weekly is treating political posts and have no desire to suggest any stricter standards for talking about Obama and Bush.

I continue to think that a different set of standards should apply to comments about other posters and my proposed experiments in editorial style deal only with comments directed at other posters--not elected officials.


Like this comment
Posted by PAmoderate
a resident of Old Palo Alto
on Aug 5, 2009 at 11:29 am

PAmoderate is a registered user.

"today's spending is far below the increase in caseloads and inflation over the past ten years"

This is a tricky use of statistics. 10 years ago is 1999, and we were in the midst of the uptick in the dot.com madness (and massive increase in spending). You should go back to before this time and then measure inflation / population increase.

On the other extreme: Web Link

"California illustrates the problem. Adam Summers of the libertarian Reason Foundation in Los Angeles has calculated that if it "had simply limited its spending increases to the 4.38 percent average annual increase in the state's consumer price index and population growth each years since fiscal year 1990-91, the state would be sitting on a $15 billion budget surplus right now."

My opinion is that we have spending problem more than a revenue problem.


Like this comment
Posted by PAmoderate
a resident of Old Palo Alto
on Aug 5, 2009 at 11:29 am

PAmoderate is a registered user.

"today's spending is far below the increase in caseloads and inflation over the past ten years"

This is a tricky use of statistics. 10 years ago is 1999, and we were in the midst of the uptick in the dot.com madness (and massive increase in spending). You should go back to before this time and then measure inflation / population increase.

On the other extreme: Web Link

"California illustrates the problem. Adam Summers of the libertarian Reason Foundation in Los Angeles has calculated that if it "had simply limited its spending increases to the 4.38 percent average annual increase in the state's consumer price index and population growth each years since fiscal year 1990-91, the state would be sitting on a $15 billion budget surplus right now."

My opinion is that we have spending problem more than a revenue problem.


Like this comment
Posted by stephen levy
a resident of University South
on Aug 9, 2009 at 12:24 pm

stephen levy is a registered user.

PA Moderate,

The Reason Foundation folks are competent economists but the data you cite is way out of date and not a sound basis for your opinion about state spending.

The General Fund budget in 1990-91 was $40.3 billion. The budget just approved in July includes $84.5 billion in General Fund spending. For these 19 years, the average growth in spending was 3.98% and your figure of a $15 billion surplus is not accurate.

It is easy to remember the budgets of a few years ago and overlook the dramatic cuts in services and spending that have happened since.

Moreover, population is not the same as caseload (for example the prison population has surged) and a general measure of inflation underestimates the impact on the state budget of high health care cost increases over the past 2 decades.

In addition, the budget numbers cited above include an artificial increases of state aid to education that was required to offset a loss in local property tax revenue when the vehicle license fee was cut. If you include that the average spending gain since 1990-91 was 3.68%.

Another way to compare 1990-91 with 2009-10 (both recession years) is to look at the share of residents' income going to the General Fund. In the 1990-91 budget it was 6.21 cents per dollar of income and in 2009-10 it will be roughly 5.4 cents per dollar of income.

There are lots of legitimate debates over the best way to handle this very difficult situation we are in from 1) the recesion and 2) our failure to balance the budget in good times.

But to repeat that California has a "spending problem" by citing out of date data is not helpful and also overlooks the $10 billion in tax cuts that we approved as one way to "spend" peak revenues in the dot.com boom years.

The budget is one of the immense challenges facing California, many of which do not have easy or painless answers.

My own view is that we need to try and come together and find our connection to a common future--the American values that have bound us together and saw families undergo sacrifices in war and depression to build a better future for themselves and future generations.

Steve


Don't miss out on the discussion!
Sign up to be notified of new comments on this topic.

Email:


To post your comment, please login or register at the top of the page. This topic is only for those who have signed up to participate by providing their email address and establishing a screen name.

PokéWorks opens in Mountain View
By Elena Kadvany | 5 comments | 5,341 views

Heart Pounding, Hands Cold and Sweating
By Chandrama Anderson | 4 comments | 2,408 views

A “Hi-Tech” Solution with a Low-Tech Payoff
By Max Greenberg | 0 comments | 846 views