Seems a bit optimistic to me. We'll see.
Good news: No new state taxes or fees
Good news from SaveCalifornia.com President Randy Thomasson
One of SaveCalifornia.com's core principles is "financial freedom." That's why I'm happy to report 3 pieces of good news in the aftermath of California's Nov. 2 election -- news that has tax-and-spend Democrats at the State Capitol all shook up:
1. Due to a published court ruling that is respectful of Prop. 13 in the California Constitution, there is a very low chance of new tax hikes from Sacramento.
2. Because California voters have just approved Prop. 26, new general fee hikes are also very unlikely. (In case you're wondering, the 2009 tax and fee increases (sales tax, income tax, car tax and "child tax") -- will expire in July and December next year.)
3. Because of what you've just read, and since California voters have also approved Prop. 22 to prohibit state raids of local government funding streams, Gov. Arnold Schwarzenegger, Gov.-Elect Jerry Brown and California's Democrat legislative leaders are only talking about budget cuts-- not tax hikes, fee hikes or borrowing like before.
The reality is, they must cut billions in wasteful programs, in light of the $25.4 BILLION state budget deficit projected for next year. California voters, in the elections of 1978 (passage of Prop. 13), May 2009 (rejection of tax and fee extensions), and November 2010, have boxed in the Democrat-controlled California Legislature, providing much-needed financial accountability.
See for yourself in Friday's news stories:
Proposition 25 foes get some insurance against tax hikes
Sacramento Bee, Nov. 12, 2010
California's business community quietly got some insurance against tax increases this week with the help of the state Supreme Court.
As the fall election campaign raged, opponents of Proposition 25, the successful measure to allow state budget approval with a majority vote, argued that tax-happy Democrats who control the Legislature would legally contort the measure into raising taxes with a majority.
No matter, opponents said, that Proposition 25 was directed at budget approval, not a separate part of the state constitution that requires a two-thirds vote for raising taxes. No matter that the 3rd District Court of Appeal had ruled that Proposition 25 "cannot be interpreted to operate as an end-run around the two-thirds vote requirement for raising taxes."
The measure's opponents, including the California Chamber of Commerce, noted that the appellate court did not publish the decision.
That all changed Wednesday when the California Supreme Court ordered its publication. Now, if lawmakers try to raise taxes with a majority, opponents can take the appellate decision into court as proof of foul play.
Turns out Proposition 25 opponents were hedging their bets all along: They asked for the publication order way back in August. Chamber spokeswoman Denise Davis said the organization "welcomes the news" from the court.
Schwarzenegger: Brown agrees with new pursuit of budget cuts
Sacramento Bee, Nov. 12, 2010
Gov. Arnold Schwarzenegger issued a challenge Friday to legislators to chop billions more from the state budget in a special session in December, adding that Democratic Gov.-elect Jerry Brown has told him he backs that effort.
"I talked to Gov.-elect Brown, and he's all for it," Schwarzenegger told reporters after examining hybrid cars at the Sacramento International Auto Show at the Cal Expo complex.
"I don't buy into that lame-duck thing, you know," the Republican governor added, explaining his decision to call legislators together on Dec. 6, the day new lawmakers are sworn in but before Brown takes office in January.
The purpose is to tackle an estimated $6.1 billion shortfall in this year's budget, which was passed this summer. The Legislative Analyst's office attributed the new deficit estimate to overly optimistic projections and losses of revenue that were not anticipated.
As voters chose Brown, they also approved Proposition 22, which instantly whacked about $800 million out of the state budget. The measure forbids some transfers of local revenues to the state coffers.
"Eventually, those legislators are going to find out that there is no choice but to make these cuts," said Schwarzenegger, who has stated that his proposal for the special session will not include any tax increase ideas.
Schwarzenegger said that with the Republicans now the majority in the House of Representatives, California can't expect to go to the federal government to help to plug shortfalls.
Now that the election is over, the governor said, maybe legislators will find it easier to make cuts. The Democratic leadership - which considered special sessions to restore some funding the governor slashed for social programs - is pushing back at him, Schwarzenegger acknowledged.
Schwarzenegger also told reporters that he intends to keep pushing his renewable-energy agenda when he's out of the governor's office.
And, surrounded by cars, he talked about how fossil fuels lead to cancer deaths and other health problems.
"I will stay involved in this very important issue," he said, and go to Washington to "slowly warm up Congress" and try to bring Republicans and Democrats together to embrace a renewable-energy plan.
The governor again celebrated the defeat of a Proposition 23, which most Republican legislators supported and would have rolled back Schwarzenegger's signature law on greenhouse-gas emissions.
Attacking oil companies that funded Proposition 23, Schwarzenegger - who was wearing a pair of tough-looking steel-toed, steel-heeled cowboy boots - savored his triumph.
"We made it clear if those interests push us around," he said, "we'll push back."
Schwarzenegger: Lawmakers, voters get budget blame
Associated Press, Nov. 12, 2010
Gov. Arnold Schwarzenegger on Friday pointed the finger at lawmakers and California voters for the 6 billion deficit in the state budget he signed just a month ago.
The Republican governor sought to deflect blame for the deficit, even though the rosy revenue assumptions he and lawmakers used were widely reported when they approved the $86.6 billion spending plan and Schwarzenegger signed it on Oct. 8.
"I think that the Legislature, as you know, did not finish their job the last time," he told reporters Friday. He said he proposed $12.5 billion in cuts, but they agreed to cut only $7.5 billion.
When asked why he signed a budget that was inadequate, Schwarzenegger denied that he knew a deficit would open up almost immediately.
"Sorry to correct you, because we did not know when we did the budget that the people of California would vote in favor of not being able to take $2 billion from local governments," he said, referring to voter approval on Nov. 2 of Proposition 22, which prohibits the state from borrowing from local governments.
"We also today, we don't know if the federal government is going to give us the money that they owe us or not," Schwarzenegger added.
Schwarzenegger and lawmakers had counted on receiving a total of about $5.3 billion in federal money in the current fiscal year. The state's nonpartisan Legislative Analyst's Office said this week that California is unlikely to get about $3.5 billion of that.
The analyst forecast a $25.4 billion budget shortfall through June 2012, a figure that includes the deficit in the current fiscal year.
Schwarzenegger made his comments a day after calling a special legislative session to tackle California's growing budget gap. The session would start when the new Legislature is sworn in on Dec. 6.
Some Democrats have said they would rather wait until Gov.-elect Jerry Brown, a Democrat, is sworn into office in January.
Schwarzenegger said he talked with Brown about the special session on Thursday.
"He's all for it," the governor said. "He knows that the faster we make these decisions, the better it is and the less he has to deal with. It's natural."
Brown is vacationing out of state. A spokesman said Thursday the governor-elect intends to work with the Schwarzenegger administration and the Legislature on the budget crisis.
Senate President Pro Tem Darrell Steinberg, D-Sacramento, said short-term solutions must be combined with a serious statewide conversation about what state government can and should provide.
"What Gov. Schwarzenegger doesn't acknowledge is that the meat-cleaver approach to cutting not only harms people but harms the prospect for economic recovery as well," Steinberg said. He said he remains unwilling to totally eliminate programs Californians count on, such as work assistance and child care.
"If he's going to present us with nothing more than a package of massive cuts, my view is that we will get started in December, but we will work with the governor-elect, Jerry Brown, to make cuts because they're necessary, in combination with a long-term approach to fix what we know is broken," he added.
John Vigna, spokesman for Assembly Speaker John Perez, D-Los Angeles, said the deficit can't really be solved until job prospects improve; California's unemployment rate has been stuck above 12 percent for more than a year.
"We'll see if there are some solutions we can adopt in December ... but the important thing is to not make matters worse with the cuts we do make," Vigna said.
Spokespeople for the GOP Assembly and Senate leaders did not immediately respond to requests for comment Friday.
The Republican governor said he warned lawmakers repeatedly since February to make deep cuts to state programs and make them early. Instead, he says legislative delays cost the state an extra $7.8 billion.
The legislative analyst warned about problems in the budget even before Schwarzenegger signed it. On the day it was passed by the Legislature, the analyst's office issued a report saying two-thirds of the budget solutions were based on one-time or temporary money, some of which may not materialize.
For example, the budget contained an assumption that there would be $1.4 billion in additional tax revenue if the state economy improved more than expected.
Before Schwarzenegger signed the budget, the analyst warned that it would leave California facing "sizable annual budget problems in 2011-12 and beyond." At the same time, Rep. Darrell Issa, R-Vista, called the budget an "embarrassment" that was filled with "false assumptions."
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