Ring the church bells and start the parade! The worst is over for the California economy!
And how do we know this? Simple. That’s what Gov. Arnold Schwarzenegger said Sunday on ABC’s “This Week.”
Of course that “happy days are here again” chatter is going to leave the governor facing a major league sales job when it comes to convincing already-skeptical Democrats in the Legislature that they need to make even deeper cuts to California’s social services.
After all, who needs the grief – and nasty floor battles – a debate over those cuts is sure to bring when at least some of California’s current fiscal problems may simply go away if the Legislature waits long enough?
Darrell Steinberg, the Democratic leader in the state Senate, made it clear last week that he’s not going to deal with the governor’s threat to eliminate the state’s welfare system, gut in-home support care for the elderly and disabled and slash insurance coverage for children until he knows a lot more about what the state’s financial position will be when the fiscal year begins July 1.
“I am not willing to wade into cutting health and human services and education deeper as our first budget act of 2010,” Steinberg told the Sacramento Press Club last week. “Let’s see what kind of economic recovery we have, let’s see how big the hole is, let’s see what type of revenue options we have.”
Steinberg took his own step toward solving the state budget problem by suggesting that the state’s $19.9 billion deficit could be low as $7 billion by the time the May budget revise comes out.
Maybe so, but that’s not a number that’s being tossed around anywhere but in the Democratic caucuses. While the state’s revenues are now running nearly $1.8 billion above estimates for the year, there’s no guarantee the cash will keep rolling in.
And if there’s one thing that’s been proven over the past few years it’s that the easiest way for a gambler to go bust would be to bet on anyone’s budget estimates in Sacramento.
It also might be worth remembering that former Gov. Gray Davis was reciting his mantra “Don’t worry, things will get better,” right up to the day he was recalled.
What this ongoing triumph of hope over experience has done, however, is take most of the excitement out of the special budget session, which ends today.
About the most interesting action the Legislature took was to deal with another potential cash flow crisis by allowing the state save money by simply not paying the bills when they come due. Kids, don’t try this at home.
When the governor proclaimed a fiscal emergency on Jan. 8, it gave the Legislature 45 days to send him a bill or bills to deal with the budget problem.
That deadline is today and the governor is expected to get a series of bills that Democratic Sen. Denise Ducheny, chair of the Senate Budget Committee, estimates will provide about $5 billion in general fund relief.
That’s only about half of what Schwarzenegger asked for and there’s no guarantee that he’s going to be willing to sign every budget measure the Democrats send to his desk.
So that leaves an interesting question: Does Schwarzenegger pound the table and demand deeper cuts right now or does he leave well enough alone and save the fighting for later in the year?
When the governor unveiled his budget on Jan. 8, he argued loudly that immediate fixes needed to be made to protect the state from a looming fiscal disaster.
“The key thing also is … that we start making the mid-term cuts now,” he said. “I wish we could just sit down for the next two weeks and work that out very quickly because the faster we make cuts now … the more we can help … the coming budget year.”
But if Schwarzenegger is convinced that “the worst is over,” is he still willing to go to the mat for those early reductions?
John Wildermuth is a longtime writer on California politics.