California budget discussion comments
Summary: The only workable solution I see is to institute a small, across-the-board spending cut on all agencies, all departments, all programs, and all spending areas in the State. Anything short of that would be ineffective, discriminatory, and leave the State in worse shape than it is now.
If deemed impossible due to Constitutional constraints, consider my feedback on several budget suggestions that have been made. Some seem sensible if handled properly. Others are clearly only going to make things worse for the State.
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On the news, I hear the legislature and the governor talking about cutting education, state workers, law enforcement, state parks, and health coverage. While several of those are the largest portion of the budget, there are many parts of the budget that are never mentioned (at least I never hear about them). Areas like transportation, perks to legislators and their aides (why can’t they use a basic Chevy, Ford, Chrysler, or Toyota standard or compact car instead of an expensive Cadillac or other luxury car?), and the justice department (mostly in perks and salaries, excluding law enforcement officers, who are already stretched too thin). I’m sure there are many other areas.
I know that various propositions of the past have tied the government’s hands by not allowing them to cut spending in some of those areas. And propositions (notably Prop 13) have also limited tax increases as an option.
However, it would seem that in a time such as this, that the legislature could (and should) draft legislation that allows them to make fair, across-the-board cuts of some small amount (one-half of one percent, one percent, two percent, whatever it takes to exactly balance the predicted budget needs). While this might lower some protected programs below prescribed levels, by being an equal, across-the-board cut, common sense would seem to indicate that such a cut shouldn’t be a problem.
For instance… The entire State Parks budget is around $70M according to the LA Times simulator. Earlier the governor had proposed eliminating that $70M in spending (and thus removing an additional $164.5M in revenue from the General Fund in taxes earned off of parks visitors within the parks and the surrounding cities and counties, for a net LOSS of $94.5M instead of any savings). That’s nearly a 100% cut to that program, which would essentially kill the entire program.
If, instead, an across-the-board cut of 1% were made to all programs, agencies, and employees, then the parks would only lose $7M (and the State General Fund would lose only $16.45 in lost, related revenues). Sure, some parks would have to go dormant, but not the entire system.
Similarly, if the $250M Healthy Families program were to be eliminated, those families would immediately become a drain on other parts of the State (it’s always less expensive to be proactive in illness prevention than pay for treatment once someone becomes ill). But, if only $25M were cut from the program, some people would probably lose coverage and treatments, but not everyone.
If transportation were to lose 1%, some projects might have to be deferred. This would be an inconvenience, but people wouldn’t die or be deprived of their independence like they will if funding for in-home health care is eliminated. (And adding new carpool lanes should be the first thing to be deferred since they seem to be a waste of money since they are under utilized, are unsafe because of the differential in speeds between the neighboring lanes, and do nothing to eliminate the pollution caused by all the cars stuck in the slower lanes.)
If the justice department and other agencies of the government that normally ride out budget slumps without fear were to lose 1% of their funding, they would probably trim a lot of pork fat that has been accumulating and that taxpayers have been paying over the years.
The only way I can see such a plan working is to make the cuts 100% equitable and completely across-the-board. If anyone–any part of the State government–is exempted, then there is probably a case for a lawsuit. Probably many expensive ones. But, if the entire State goes on a budget spending diet of a tiny percentage–just enough to close the gap–then there is no favoritism. There is no discrimination. There is no bickering. Yes, there’s a bit of pain, but it’s shared by all proportionally. It helps to make California healthy again, and it does it without raising ANY taxes or eliminating ANY programs.
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Other proposals mentioned that I am in favor of for helping to close the budget gap:
- Oil severance
- Modest increases in gasoline, alcohol, and tobacco taxes.
- Elimination of Prop 13 limitations, at least on commercial property
- Early release of prisoners into a rehabilitation program (I believe Kansas and one other state have highly successful working models that have saved those states a lot of money AND lowered the number of parolees who circulate back into the prison system–a double win!)
- Increasing spending on fraud prevention to save millions.
- Eliminate bilingual education programs that waste money. There are “newcomers” programs for Mexican immigrants that have highly compensated specialist teachers, aides, and other program staff that have classes of 8-10 children, yet the cost for the single classroom is likely higher than an entire classroom of 25-30 children supervised by a single, overworked and underpaid teacher. The students stay in that special program for at least a year, and seem to make very little progress. Students who speak languages other than Spanish, thus are not eligible for the program, seem to adapt just fine in normal classrooms, often learning English faster through a total immersion program.
- Make English the official language of the State. The cost savings (and environmental savings) of not having to print everything in both English and Spanish should be considerable.
- Add no-fault provisos to medical care and related legislation that requires insurance companies and practitioners to drop their rates once expensive malpractice lawsuits are eliminated; a fund could be established with clear guidelines so that someone harmed by could still receive some form of restitution, as long as it is fair for all.
- Allow government and private health care programs to purchase prescription drugs from Canada to save money.
- Add no-fault provisos to vehicle insurance, too. The State may not save a lot of money directly, but the savings to taxpayers in insurance costs would flow right back into the economy.
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Proposals mentioned that I am strongly opposed to for closing the budget gap:
- Effectively closing the State Parks Department. It’s a drop in the budget bucket, that brings in $2.35 for every dollar spent. Additionally, these are lands, buildings, and pieces of heritage held in trust for current and future generations.
- Closing the California Community College system. This is the best way that Californians can improve their lives through education. On a results per dollar spent basis, the Community Colleges are a bargain, because they turn low-income unskilled laborers into skilled workers, bringing long-term increased growth to the General Fund through taxes.
- Cutting Cal Grants would likewise eliminate the possibility of many Californians from attending colleges and universities,
- Cutting UC and CSU funds (except to the highly paid administrators who had the gall to vote for a pay increase when they should be considering a pay reduction instead).
- Cutting funding from any preventative health care program. Again, every dollar spent in prevention saves much, much more money in treatment costs down the road. Additionally, healthy workers earn more money and are more productive. That results in improved tax revenues, both in income taxes and taxes on the products created and services rendered.
- Cutting funding from treatment programs. Sick Californians are likely to make more Californians sick, and that adversely impacts the healthy people needed to get this economy working again.
- Cutting rehabilitation programs for prisoners and paroles. It has been successfully proven in states like Kansas that spending MORE money on rehabilitation results in a clear REDUCTION of expenses in prison spending. The more quickly people get into a rehabilitation program and get out of prisons, the better their chances are for returning to productive lives. When rehab programs are fully funded and well implemented, they cut the vicious cycle of incarceration, parole, infraction, re-incarceration. That cycle is extremely expensive, yet the cost to adequately rehabilitate a person is a fraction of the cost to cycle them out and back into the system.
- Short-term borrowing against potential future revenues. We have to cut spending and raise revenues. Borrowing is what got the State into trouble in the first place, just as it did many Californians.
- Pushing debt off of the State and onto local governments. The State raids the coffers of local governments, doesn’t pay back their debts when they are supposed to, and now the State is considering pushing State debt onto local governments, many of which are already in bankruptcy or nearly so? No way. It’s the State’s mess, and the State MUST deal with it directly.
- Cutting retirement benefits and state worker salaries or benefits. They have already cut and lost so much that they fought to gain–no more. If cuts must come, then it should start at the top. A 1% pay cut for someone earning $120K/yr is uncomfortable, but to someone earning only $18K, it’s devastating. Any potential cuts must take that into account. The cuts would also be more effective if they were tiered to reduce the biggest expenses first.
- Closing the California Conservation Corps. This is a highly beneficial program for the State and for its members. It’s not utilized as well as it should be, and that is probably due to the previous decentralization of administration in the CCC. The program should be strengthened and brought back to its New Deal era prominence. Such a program would be a wonderful opportunity for many Californians to give back to the State through community service while earning a living wage.
- Broadening sales tax to include services. While this might eventually be necessary, it would need to be phased in gradually over many years to avoid devastating a huge sector of the economy. Nothing about that would be a quick fix, but it could certainly be a speedy disaster if implemented poorly.
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Links:
http://www.latimes.com/news/local/la-statebudget-fl,0,95571.htmlstory
http://www.wastewatchers.ca.gov/
