California Must Cut Spending and Restructure

THE CALIFORNIA Journal of Politics & Policy Commentary California Must Cut Spending and Restructure Joel Fox * Small Business Action Committee Dealing with California’s budget problem requires a two-stage plan. One is to face the immediate crisis of the budget shortfall before the state runs out of cash. The second is to begin restructuring the way government operates that will pay off for California citizens in coming years. Given the result of the Special Election, the first order of business is to cut spending. The governor’s budget proposal carries over $15 billion dollars in cuts. Many of those cuts will have to be applied. While some programs designated for the chopping block such as CalWorks www.bepress.com/cjpp Volume 1, Issue 2, 2009 may be saved in part to handle the immediate crisis, few programs will be left unscathed. State revenue stands approximately equivalent to the level of the 1999 Gray Davis budget if it were adjusted for population and inflation over the last decade. Scaling back spending to those budget levels is appropriate in this time of crisis, although money can be redirected in various budget categories to limit damage from cuts in certain areas. For example, if education were required to adopt a “Classroom First Budgeting” proposal, the education cuts will fall more heavily on bureaucratic practices or support staff and less on students and teachers. Some previously offered methods to achieve savings, which would have been unthinkable a few years ago, will likely find traction. Releasing some nonviolent prisoners near the end of their terms, or elderly prisoners, will reduce *Joel Fox served as president of the Howard Jarvis Taxpayers Association and is currently president of the Small Business Action Committee.