Arnold’s drop-by at his big press avail on the May budget revision was a case of the elephant giving birth to the mouse.
The administration has been putting out details of its worst-case/worser case scenarios for almost a week: more cuts for schools, early release of thousands of state prisoners, selling off everything but the Golden Gate Bridge. So there wasn’t a whole lot new in terms of the numbers, and the governor’s plaintive plea on behalf of his ballot props next Tuesday was definitely déjà vu all over again.
(The Department of Finance report on the two alternatives for addressing the deficit for the fiscal year that begins July 1 — $15.4 B if the props pass, $21.3 B if they don’t — is here.
That said, his Arnoldship did make at least a few interesting statements, starting with his introduction of Finance Director Mike Genest – “this man is on suicide watch” – that will frame yet another budget brawl, which will erupt next week as soon the election formalities are finished:
1-“To look for new revenues is out of the question.” It’s true that in negotiating this year’s budget deal, Schwarzenegger kept insisting that he’d never go for tax increases, right up until he did. But his position at this point is basically irrelevant; with the six Republican legislators who signed on to new taxes in February all being punished – by losing their leadership posts, facing recalls, or being shunned by the GOP caucus – it’s a safe bet that the death grip Reps hold on budget matters because of the 2/3rds requirement will now be tighter than ever. So look for lots of anti-tax triumphalism by the party of Grover Norquist, er, um, Lincoln.
2-“I absolutely despise taking money away from local government.” Besides looming battles over more cuts for education and cutting prisoners loose, the loudest fight will be over Schwarzenegger’s grab for $2 billion from local governments, in direct violation of his earlier promise not to do just that. With cities and counties scrambling to pay cops and firefighters while facing the same recession-level revenue problems as Sacramento, taking an extra hit so the Capitol Clown Show can pretend to balance the budget won’t be popular.
3-“You hope the economy is coming back.” That’s a bottom line underlying assumption of Schwarzenegger’s fiscal strategy at this point, whether the May 19 props pass or not. In addition to squeezing the locals by “borrowing” $2 billion, both his fixes also call for $6 billion in new borrowing through Revenue Anticipation Warrants and scheming to use federal stimulus money to backfill state cuts; in other words, kicking the can down the road, one more time.