Same meeting, usual suspects
Arnold G. York/Publisher
Once a year, board members of the California Newspapers Publishers Association (CNPA) migrate up to Sacramento to perform the annual ritual of listening to legislative leaders and then making the rounds and lobbying their own legislators. The association is a strange one, more than 125 years old, with a board of an equal combination of large metropolitan dailies like the Los Angeles Times and San Jose Mercury News, and small weeklies like The Malibu Times and the Palo Alto Weekly.
It’s always interesting to make the pilgrimage in the year of the gubernatorial election, because everyone shows up to speak. This year was no exception.
Among the politicos present this year were Gov. Gray Davis, new Speaker of the Assembly Herb Wesson, Senator and Chair of the Republican caucus Jim Brulte, Republican Assembly leader Chris Cox, Senate Pro Tem John Burton (D-Calif.) and Sen. Debra Bowen (D-Calif.) from Marina del Rey.
There were two topics on everyone’s plate: one spokenthe budgetand one unspokenhow it would effect the November election.
Our legislative leaders are always operating six months ahead of us, so whereas to us, this is January, to them, this is July. They’re worrying about things we haven’t even thought much about, like the condition of the budget deficit, or, to put it another way as expressed by Burton, who has a unique style of expression all his own, it’s “toiletsville.”
The state is about $12 billion in the red right now, and the deficit is growing. A shortfall of $14 billion is predicted. The state’s economy, particularly in Northern California, has been slowing since March, so tax receipts are off and an anticipated $8 billion surplus has vanished. Although things are improving, California is not expected to come out of this recession until mid-2002. That means income tax receipts, which always trail the economy, are going to be off all of this year and into 2003.
All the officeholders were careful to explain to the CNPA board the deficit was due to larger forces in the economy over which they had little control (probably true), but, in the main, it was being exacerbated by inadequate leadership of the other party (probably untrue).
Most of the publishers in the CNPA have been around for a while, so all could remember poor Pete Wilson coming into office in 1990 and getting hit with this whopping recession. All the Democrats were chiding him for weak political leadership, and now it was the Republicans’ turn. Apparently there are only two ways to act, according to the oppositionact too slowly and allow the situation to worsen unnecessarily, or too quickly and precipitously, and make the situation worse.
Politically, the only difference between Wilson’s recession and Davis’ recession is Wilson was luckier. If you’re going to have a recession, it’s always better to have it at the beginning of your term so you have four years to work it out, rather than have it at the end of your term, when you have to run for re-election in November.
Fundamentally, there are only a few things a state can do when a recession comes and, the truth is, the solutions are pretty much the same whether you’re a Democrat or a Republican. What Davis the Democrat is talking about now is pretty much what Wilson the Republican was talking about then.
The solutions are as follows:
You have to cut or delay programs to lower expenses, but, no matter how you do it, it’s going to be bloody and some people are going to hate you. Recessions mean more people are out of work, and the safety net is even thinner than usual.
You have to raise income, which, no matter how you state it, means taxes are going to increase.
It takes both the cuts and increases because it takes two-thirds of the Legislature for these kinds of budget votes. Both parties have to compromise or nothing will pass. They’ll make noise, they’ll blame each other, they’ll stall, but ultimately, the two parties will vote for both.
By law, unlike the federal government, the state budget has to balance but there are ways to handle that.
– First they’ll do something, which I’m charitably calling budget arithmetic. They’ll do an Arthur Anderson’ and, before they’re finished, they’ll make the Enron accounting seem a model of clarity. This can be done in several ways:
– Being optimistic in estimating income
– Being very conservative in estimating expenses
– Estimating income that’s very unlikely to arrive For example, they’re estimating receiving $1 billion from the federal government, which probably will happen only if we go to Washington, D.C. with a gun, unless the president and his group decide the Republicans could actually take the state. Then, of course, the money will flow, if we get the right election result.
– Then you try and turn some expenses into two-year programs, so you have a couple of years to pay them off. In other words, you let your payables grow and pay some of them next year. People, like Medicare providers, will turn gray waiting for their money.
– Where you can, borrow, which means bonds. Use that money now and then wait for the better years to pay it back.
Actually, there is nothing wrong with what they’re going to do. The state weathers a recession much the same way we do in our personal lives.
What’s different is they’re going to spend a lot of time, a lot of ink, and a lot of attack commercials blaming each other, and the truth is most of it is pure baloney.
| 9:!/W =-®,]””E”| 9:!/W =-®,]””E”|-/ =!”# $ %
[4@ 4NormalCJOJPJQJmH ‘~ Luis Di StefanoZIP-100:1-30-02:opinion @88…%85
- 20 Same meeting, usual suspectsLuis Di StefanoLuis Di Stefano
P\dlt’Same meeting, usual suspectsMiameLuis Di StefanouisNormal Luis Di Stefano1isMicrosoft Word 8.0 @@2″g4@xn-4
‘ m% bSame meeting, usual suspectsTitle 6>
!”# %&'()*+ -./0123 6 Root Entry F^481Table WordDocument 6SummaryInformation( $DocumentSummaryInformation8 ,CompObj XObjectPool ^4^4 FMicrosoft Word Document NB6WWord.Document.8