Posted on 02/15/2004 12:15:28 PM PST by calcowgirl
SACRAMENTO - The Proposition 58 spending measure on the March 2 ballot was supposed to propel Gov. Arnold Schwarzenegger's Proposition 57 deficit bond to victory, but could instead bring it down.
Proposition 58 - which the governor intended to be a tough companion limit on spending - wound up a much weakened twin that also has to pass in order for the bond to go into effect.
The Republican governor, while urging voters to approve his $15 billion deficit bond, still speaks of the companion ``balanced budget'' initiative as if he hadn't compromised to get the Democrat-dominated Legislature to put the measures on the ballot.
``By voting yes on Proposition 58, you are basically taking the credit cards, cutting them up and throwing them away so that the politicians over there (at the Capitol), those big spenders, will never ever get the state into this kind of trouble again,'' he said at a recent appearance.
But some taxpayer groups and other foes argue that in reality the constitutional amendment does little to limit spending. Instead, they say, it opens the way for more borrowing, spending and taxing by politicians.
``Reject this ruse!'' opponents urge in a statement by Richard Rider, of the San Diego Tax Fighters, and others.
``Remember the original deal we were promised by Arnold? Vote for a huge $15 billion bond to pay for past mistakes, and we'll pass a solid spending limit so this mess doesn't happen again.
``Proposition 57 gives us the bonds, but Proposition 58 does not give us any spending limit.''
Specifically, Proposition 58 would:
- Require enactment of a balanced state budget.
- Establish state budget reserve requirements.
- Prohibit future deficit bonds.
- Create a formal process for midyear budget adjustments.
Proposition 58 foes say the state constitution already requires the governor to propose a balanced budget each year.
But that requirement does not currently apply to the budget ultimately passed by the Legislature and signed by the governor.
The constitution also already requires a budget reserve, foes point out. But the constitution does not specify the size or conditions under which funds must be placed in that reserve, as does the initiative.
Opponents, in addition, say the constitution already prohibits long-term borrowing from being used to balance the budget, as would the initiative. But, at the same time, foes say the measure contains a major loophole - it does not ban short-term loans.
Moreover, according to opponents, the proposition's budgetary course-correction provisions are redundant because the Legislature has met in special session during the past three years to consider mid-year proposals to address budget shortfalls.
However, there's no formal process in the constitution - as there is in the proposition - to require that mid-year corrective actions be taken when the budget falls out of balance.
Polls last month indicated Proposition 58 is faring better than its companion deficit bond. Schwarzenegger is aggressively campaigning for both measures and neither faces organized, formal opposition.
Proposition 58 grew out of demands Schwarzenegger initially made to Democratic leaders that he would not support a deficit bond without a permanent cap on spending. The governor first sought a cap that would limit spending increases to population growth and inflation.
But Democrats fought the plan, saying the cap was too restrictive and did not take into account programs such as education and public health, in which costs often grow faster than either population or inflation.
Schwarzenegger and Democrats finally agreed on what has become Proposition 58.
Despite the attacks on the proposition, the state's independent, nonpartisan legislative analyst has concluded that its budget-balancing and borrowing-limit provisions might force officials to take more immediate actions to correct budgetary shortfalls and create larger budget reserves that smooth state spending issues.
Contact Sacramento Bureau Chief Steve Geissinger at sgeissinger@angnewspapers.com
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