This Year’s Budget Earns a “Participation Trophy” – Pacific Research Institute

This Year’s Budget Earns a “Participation Trophy”

It’s amazing what a difference one voter-approved proposition can make.  The Legislature is poised again to pass a budget before the June 15 constitutional deadline.  Gov. Brown has until June 30 to sign it into law.

Budgets used to be a lengthy, messy fight at the Capitol.

Back in the day, we’d have a pool running for how many days late the budget would be.  Under the old two-thirds vote requirement to pass a budget, “budget overtime” would often last a month or longer.

One year, the budget was enacted so late that I was on a long-scheduled vacation in Mexico during the budget vote.  I figured October would be a safe time to take a vacation!  To rub it in, I sent pictures off my balcony deck of Los Arcos in Cabo Sun Lucas to my annoyed colleagues stuck working in Sacramento.

In November 2010, everything changed.  Voters enacted Prop. 25, which changed the budget vote requirement to a majority vote.  It also added the sweetener of withholding lawmaker pay for failure to pass an on-time budget.  Not surprisingly, we haven’t had a late budget since!

As my former boss, the very quote-worthy Connie Conway, said to a colleague after the passage of Prop. 25, “I’ve got 99 problems, but a budget isn’t one of them”.  The Republicans are now shut out of the process, which isn’t a good thing for building budget consensus.

Even though recent budgets are passed on-time, it doesn’t mean they are improved.  Every year, budgets continue to ignore pension and other long-term debt (though progress has been made in paying down Governor Brown’s “wall” of short-term debt).  Meanwhile spending continues rising to unsustainable levels.

A few thoughts on this year’s budget agreement:

  • This year’s final budget agreement sets up the state to spend roughly $200 billion – another record. This is despite Governor Brown’s self-proclaimed conservatism.  Imagine how much next year’s budget would spend under fiscal liberal Gavin Newsom!
  • Legislative leaders and mayors are applauding the additional $500 million to boost homeless programs. As Kerry Jackson wrote in Good Intentions, non-profits and private charities have a much better track record in lifting people out of poverty than government programs.  If history is a guide, we can expect more of the same poor results from this new funding.
  • Despite putting the breaks on single-payer legislation (SB 562), the budget includes $5 million for a “universal health care task force.” I don’t think we need another government committee for this.  However you slice it, government-run health care would be bad for patients, employers, and taxpayers.  The Legislative Analyst estimated that SB 562 would cost taxpayers $400 billion annually – double the state budget.  Why don’t we save that $5 million and instead just read the LAO report?

So, bravo to lawmakers for passing a budget on time!

But instead of a gold medal for a job well done protecting taxpayers, I’m afraid all I can give out this year is a “participation trophy” for your budget efforts.  Despite a fully-stocked rainy day fund, we are still just one economic sneeze away from a budget catastrophe thanks to our volatile tax system and constant budget uncertainty.

Tim Anaya is communications director for the Pacific Research Institute.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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