A Spending Cap Solution for the Budget Talks
One of the main sticking points in the discussions over a budget solution is whether California will adopt a tougher spending cap. The Republicans insist the spending cap is part of the deal. They have argued for years that excessive and automatic spending is greatly responsible for the continued budget deficits the state has struggled with over the years and only the discipline of a spending cap can reverse that trend.
The Democrats have no interest in a spending cap. They argue that a rigid spending cap will prohibit the state from responding to changing needs of the people.
Politically, Republicans are concerned that since Democrats are so adamantly opposed to a spending limit measure, even if the Democrats agree to putting such a measure on a future ballot in exchange for tax increases, the Democrats and their allies will go all out to defeat it when the proposition comes before voters. In this scenario, the tax increase bartered for the ballot measure will already be in place. (The spending cap would be a constitutional change and therefore would require approval of the voters.)
Given the set-in-stone attitudes on both sides, there has been no movement on this important issue.
It’s gonna get worse before it gets better
Two weeks ago, during a lecture at a Southern California college campus, a student asked me a question about if and how the growing state budget deficit had impacted me. I quickly responded that most Californians – expect those involved in the day-to-day rigmarole in Sacramento – have not been directly or even indirectly impacted by the state’s annual budget mess.
In looking more deeply at that statement, here’s the simple reality: Despite massive deficits, little has changed in our daily lives because of Sacramento’s inaction. Our public schools are still open. Roads, bridges, railroads and ports remain operational – albeit the maintenance on them may have slowed or ceased. If you turn on your tap, water still flows out of it. In short, nothing has changed despite the news that the sky will soon fall.
So, when Governor Schwarzenegger stood up last week and spoke of Armageddon, and papers report that the “Big 5” talks cratered again…why should any Californian get nervous because the state faces a budget gap? Claims that the “sky is falling” have occurred before. We’ve faced budget shortfalls previously and have always found a way to bail ourselves out – usually by borrowing to put-off the tough decisions.
BailOut Fatigue?
Americans have famously short attention spans. Media frenzy will carry a story for a week or so, maybe a couple of weeks in extreme, unfolding situations, and then Breaking News will sweep that one away for another. TV Talking Heads stations will then come up with compelling names for the story: “Terrorist Horror in Mumbai” or “StormWatch 2008” or whatever, with reporters in network logo rain slickers standing in hip waders in swirling waters, until the next one comes along. You can get caught up in it – I spent much of Thanksgiving’s long weekend watching that horror in Mumbai and I recall vividly wasting an entire Labor Day Weekend horrified, watching Katrina drown New Orleans (to the consternation of family and friends who wanted me to ‘Get a Life’).
Now it’s BailOuts. One explanation for the stunning Congressional denial of a $15 Billion Dollar BailOut to US AutoMakers, after handing over some $350 Billion or so to Wall Street (dare I say, “Pirates,” without giving up journalistic objectivity?) with virtually no strings attached and very little transparency (can you list the recipients of that money and how much each received?) is BailOut Fatigue. Enough already with the handing out of my and your hard-earned, but apparently easily spent, taxpayer dollars.