Schwarzenegger has to cut costs
How Will Schwarzenegger correct the California budget deficit?The main reason that Gray Davis was recalled in California is the budget deficit for which he is largely held responsible. Now Arnold has vowed to make the budget his first priority.
This morning he said, "We don't know exactly what the current operating deficit is. It went from $7 billion to $8 billion to $10 billion and just this morning I found out if this court case goes wrong, it could go to $20 billion."
He was referring to a lawsuit that would stop the state from issuing bonds to fund the current state deficit.
I admire the fact that Arnold wants to comply with the law, and work towards a balanced budget for California, but anyone in business knows that there are two ways to close a deficit. They are 1.) Increase revenues and 2.) Decrease expenditures.
There are a couple of glaring problems with Arnold's "plan":
1. Arnold has vowed not to raise taxes, and to abolish the recently passed auto licensing fee which nearly tripled the auto taxes in California. The auto tax was expected to bring in somewhere in the neighborhood of $4 billion, an amount that would significantly reduce the debt. This means that not only will Gov. Elect Schwarzenegger not be able to increase revenues, he is starting even farther "behind the eight-ball" than expected.
2. There are only a few ways to decrease expenditures. Arnold could eliminate government jobs, which I am sure will go over very well. He could decrease correctional agency funding, perhaps by releasing non-violent offenders into parole. Ofcourse, the health and human services funding makes up 28% of the state's budget. I'm sure everyone would understand if Arnold cuts health and human services... which brings me to the real reason that I began writing this evening:
There is a great liklihood that health and human services budgets will be cut. We cannot forget that Schwarzenegger is a Republican. "Privatization" is the mantra. What will happen to the elderly who depend on state-run programs as a major part of their lives?
While it may be too late for them, it is important that we all take some time to prepare for our own future. You never know when a less-than-qualified candidate will be chosen to make the tough decisions that directly affect your life. Long Term Care Insurance puts the reigns of your life back into your hands. Don't rely on the compassion of the politicians in power.
