Brown budget may go “all cuts”

“We do not have a spending problem. We have a revenue enhancement problem.” That infamous quote from former Democratic District 1 Assemblywoman Patty Berg could hold the key to a lot of the budget problems plaguing Sacramento lawmakers.

Democrats and Republicans have already gone back and forth on cuts to universities, shifting prisoners to county jails and slashing funds for Medi-Cal patients, mopping up between $11 billion and $14 billion of the state’s $26.6 billion red ink by trimming line items, taking funds from special accounts and coming up with creative ways to raise revenue. That, however, appears to have been the easy part; finding the rest of the money will be significantly harder … and likely more painful as of this week.

On Wednesday, Governor Jerry Brown dropped his plan to broker a bipartisan California budget by asking voters, via a June special election ballot measure, to approve a five-year extension of temporary sales and income taxes originally enacted in 2009 that he hoped would help close the state’s $26.4 billion gap by $12 billion.

Brown came close, needing just four more Republican votes to realize the special election. He attributed the shortfall to a lengthy list of GOP counter proposals. “Every Republican legislator I’ve spoken to believes that voters should not have this right to vote unless I agree to an ever-changing list of [at least 53] collateral demands,” he said in a statement late Tuesday afternoon.

“Governor Brown and the Dems can’t have it both ways. They asked for ideas, and then complained there were too many,” Tom Del Beccaro, chairman of the California Republican Party Chair responded.

Now the governor is free to implement his threatened “all-cuts” approach to the budget. Nothing would be overlooked, with Brown targeting everything including ending K-3 class-size reduction and eliminating sports at community colleges, according to a report from the nonpartisan Legislative Analyst’s Office.

GOP leadership objected to the special election proposal, spinning the extensions as “new taxes,” even though the measures would only telescope out taxes currently in existence. The GOP leadership is also opposed to Brown’s call for eliminating redevelopment agencies, an idea that has support from the historically conservative Wall Street Journal.

Democrats, who of late have been “cut happy” on certain sections of the budget, may have had their fill, and likely won’t stomach billions more in cuts. Republicans say they are in favor of health and welfare reductions, but opposed to cuts to education and corrections.

“The Republicans, for some reason known only to them, don’t want to balance the budget with cuts. And they don’t appear to want to balance it with new revenues. So they must want a profound, continuing unbalanced budget,” Gov. Brown observed.

Republicans responded that they aren’t opposed to cuts, but disagree with Democrats’ methodology. “We agree with cuts, but if you look at it overall, there are some cuts, but it’s not $12 billion worth of cuts. It’s fund shifts, and it’s moving [money] around,” Assembly Republican Leader Connie Conway, (R-Tulare) said.

Senate Republicans, who have had talks with the governor, have also proposed amending the State Constitution with spending caps and pension cuts, and loosening strict regulations that affect businesses and construction, hoping to draw back industry that has fled the state for better tax climates. Unions oppose the constitutional changes, but say they are willing to address the pension system.

A recent Field/UC Berkeley poll showed that registered voters are inclined to support tax extensions, but at the same time oppose any new tax hikes.

“I think they have to be careful that it’s not perceived as they’re going to the voters to raise taxes because the legislature couldn’t get the job done,” said California political consultant Adam Mendelsohn, a former adviser to Gov. Arnold Schwarzenegger. “People have such a low opinion of what’s happening in Sacramento.”

No wonder since the dysfunctional behavior shows no sign of letting up. The Senate has debated and passed budget measures on strictly party-line votes, typically with zero GOP support, and the Assembly has proven to be a model of partisan bickering and procedural acrimony.

As Daniel J.B. Mitchell, UCLA Professor Emeritus of Public Policy and Management, observed, “Brown could take the position that ‘you’re not giving me this (tax) option, so if that’s what you want, I’ll give you the budget you seem to say you want.’” The governor, he added, might try to “present the ‘budget from hell’ and see what happens.”

Additional sources: The Times-Standard, Sacramento Bee, Christian Science Monitor