Saturday, May 12, 2012

California Deficit Swells to $16 Billion

The CA budget deficit has swelled to $16B. $$ 

This would seem to be a problem, right? But this is quite easy to solve.  First, just project that voters will vote to raise taxes in November.  Next, project that tax revenues will increase due to economic recovery and higher tax rates.  Then, announce that there will be a government hiring freeze and staff cuts in the Highway Patrol, teachers, firefighters, prison guards, and others in the state workforce.  Finally, pass a budget that appears balanced based on all these things.  (We will hear some of that Monday, when Governor Jerry Brown presents the May budget revise.)

Then, in November 2012 it is likely the tax hike vote will have failed.  In 2013, none of the staff cuts will have happened and there will have been an actual increase in the state workforce.  Tax revenues will fall short of projections, and there will be another huge state deficit.

But then, they'll just do the same thing for the 2013-4 budget.

Apparantly, it's not a problem.  It doesn't seem to matter if the ledger balances out or not.

I remember back in college taking accounting classes, where I'd spend hour after hour on homework, trying to get the ledger to balance.  What a waste of time.  It doesn't need to balance!!!

California Deficit Swells to $16 Billion, Governor Says
California's budget deficit has swelled to $16 billion after tax collections trailed projections amid the tepid economic recovery, Governor Jerry Bro... Read more

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