Monday, May 14, 2012

The Bare Bones Era - 2012: Brown's Budget - Is the sky really falling?

The headlines are flying today as Governor Jerry "Moonbeam" Brown announced the May version of his ideas about a 2012-13 Budget. Most seem to imply the sky is falling.

It is almost impossible to compare Moonbeam's budget proposal to past years because of his "realignment" of revenues and expenditures, such as shifting prisoners to counties. It is almost impossible, but not quite impossible.

And if one attempts to see how Moonbeam's proposal compares to actual revenues and expenditures in 2002-03 - ten years ago - it is even a little more complicated.

Nonetheless, it is possible to compare his proposal to 2002-03 after:
  1. adjusting for "realignment" of responsibilities to counties,
  2. adjusting for the additional costs for voter authorized bond issues since 2002-03,
  3. adjusting for the elimination of a substantial annual property tax relief expenditure beginning in 2003-04,
  4. adjusting for the unscrupulous credit taken against CalPERS earnings, and 
  5. adjusting for population growth plus the cost of living index.

What one finds is that Moonbeam's January 2012-13 General Fund Budget revenue projection was $12± billion higher than one might reasonably expect would result from "normal" budget growth based on population and CPI increases compared to 10 years ago.

His new May budget proposal revenue is $9.5± billion higher. And if one deducts the revenue from his proposed tax increase, then his revenue projection is "only" $4± billion higher than one might expect compared to 10 years ago.

Don't misunderstand the situation. Our State and local government finances are in a mess. But it is a cumulative problem we have created which can only be fixed by radically restructuring our State government. We're never going to do that.

And it is essential that the voters pass Molly Munger's California PTA backed initiative to fund education, with the funding bypassing the Legislature and the Governor. But that opinion has to do with building an economic future for California's children.

Nonetheless, don't accept Brown's explanation:
"I said at the beginning when I ran for this job that it has taken a long time, more than a decade, to get into this mess. We're not going to get out of it in a year -- or even two years. But we're getting there. We're making real progress," Brown told reporters in releasing his updated budget.
Yeah, more than a decade. How about we started getting into this mess with Brown's failures in his first two terms and he's not making "real progress" now.

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