Advancing a Free Society

How Now Brown Budget?

Monday, June 27, 2011

There was a time when California meeting its July 1 budget deadline was considered a miracle – on the probability scale, somewhere between and the Chicago Cubs winning the World Series and Carrot Top taking home an Oscar.

Well, miracle of miracles, it looks like Sacramento will have a new budget by Friday. Late on Monday, Gov. Jerry Brown and the Democratic-controlled Legislature reached a tentative agreement.

I’ll spare you the fine details of how Brown and his fellow Democrats came up with a working blueprint (here’s a rundown of the finer points).

Suffice to say: if your tax accountant did the same kind of number crunching, an IRS audit and an orange jumpsuit wouldn’t be far behind.

California’s budget assumes $4 billion in revenue windfall that may or may not materialize by next year; it assumes lawmakers will have the courage to make good on promised “trigger” cuts if said revenue doesn’t materialize.

At least they didn’t bank on a Facebook IPO to fatten California’s capital-gains take.

So what does this say about the state of the Golden State? Look no further than the budget’s winners and losers.

Winner: Jerry Brown. He forced legislative Democrats into accepting spending cuts, even while he couldn’t get Republicans to agree on tax extensions. It may kill him to sign such a smoke-and-mirrors narrative, but at least Brown can claim he got it done on time.

Loser: Jerry Brown. He promised no budget gimmicks during his run for governor and made good on his word by vetoing a transparently flimsy Democratic plan – only to agree to a deal chock full of creative financing. Six months ago, the governor rolled the dice and bet that he could broker a deal with Republicans. When that crapped out, he simply went over to the next table and made another roll – a $4 billion bet.

Loser: California Democratic Legislators. Brown vetoed their first budget. State Controller John Chiang added insult to injury by cutting off their pay for failing to produce a legitimate spending plan by California’s June 15 constitutional deadline. Now, they have go to back to their liberal constituencies and explain why still more cuts may be on the way.

Winner: California Republican Legislators. They refused to budge on taxes; Brown couldn’t break their ranks.

Loser: California Republican Legislators. Had they cut a deal with Brown – agreeing to tax extensions if the governor met some of the GOP’s myriad demands – Republicans might have had the best of both worlds: reforms that otherwise wouldn’t see the light of day in Sacramento; a tax extension more than likely to be rejected by voters in a special election.

Winner: States Not Named California. On the same day that the Golden State showcased its fondness for creative financing, Pennsylvania moved closer to $27.15 billion budget that’s unprecedented for its 4% in spending cuts. A day before, in Wisconsin, freshman Gov. Scott Walker signed a two-year $66 billion spending plan that included 50 last-minute line-item changes (31 fewer than his Democratic predecessor). In New Jersey, GOP Gov. Chris Christie awaits a budget from the Legislature – Christie being a governor who’d like to expand his veto authority.

What these states have in common: they’re addressing their budget shortfalls honorably and honestly; in New Jersey’s case, there’s a fascinating story evolving about the relative powers of two branches of government.

California doesn’t have the same positive story to tell. Come Friday, it’s likely to have a budget that’s forgettable, at best.

(photo credit: Randy Bayne)