January 16, 2010
Schwarzenegger’s deficient thinking
A couple of months ago I interviewed an economist in Sacramento who has long studied California state finances. I asked him what the lowest general fund budget was that he could envision in California as state revenues shrivelled. He answered: $85bn a year. The state simply couldn't function with a smaller budget than that.
Last week, Governor Schwarzenegger declared another fiscal emergency, and proposed an $82 billion budget – three billion dollars below the barebones survival estimate of my economist friend.
Amidst all of the doom-and-gloom cuts, and the accompanying rage as the state that until recently epitomised possibility in America continues to implode, one policy change stood out, offering a glimmer of better priorities in the years ahead. Schwarzenegger called for a state constitutional amendment to ensure that the state never spent less than 10% of its general fund on higher education and never spent more than seven percent on prisons…
LINK - Guardian.co.uk
