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What the editorial fails to ask is just why when the state gets windfall revenues from a capital gains recognition boom that it then spends, when the windfall ends revenues should in part be made up with higher taxes. That would seeem to be a formula for an ever higher tax burden as spending "floors" permanently ratchet up during boom times. That even in California is not sustainable, since it must compete with other states with lower tax burdens.

The clever liberal would try to get out of that box by having the feds do more of the spending, or shipping money to the states, in order to keep spending high while avoiding the interstate competitive conundrum. And that of course is the exact policy that is being avidly pursued now by the usual suspects. I have heard it from the mouths of the newly elected Democrat governors of Michigan and Pennsylvania, and now from Davis. And Bush appears to be on board, at least in part, with this "risky scheme."

As far as I'am concerned the liberal rags such as the sj mercury news, la times, san francisco chronical et al are part and parcel to the problem. They failed big time to keep the voters informed about what was really going on in Sacramento. They turned out the be the mouth piece for the grey davis. Looks like the cover up continues. Parley

It's not unique to California. Ct was also the benefactor of the cap gains bubble and spent like a drunken sailor. Now it is time to raise taxes to make up for the budget shortfalls and whine about the feds doing more.

The cycle never ends. Spending increases in good times and then to appear moderate the solution is to close the gap with spending cuts and tax increases equally.

Of course the result is a continous positive slope with the x axis representing time and the y-axis representing spending.

I'm at wit's end. State employees are by far the biggest expense item in the budget. They can look forward to golden early retirement and the rest of us can look forward to golden showers.

Somehow the cycle needs to be broken. I have no idea how that will ever happen.