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The Balancing Act Opens

March 04, 2004

Gov. Arnold Schwarzenegger used his actor's charm and lots of money to attract voters to his side on a $15-billion debt bond measure. He confirmed his political power, using public support from top Democrats to pull Propositions 57 and 58, twin measures to roll over the debt and control spending, from below 40% in the polls to a landslide victory. He and the state legislators who agreed to the measures should relax and pat themselves on their backs.

OK, that's enough.

Now start balancing the state budget. This will be a lot more painful than folding all the old debt into a bond issue.

Lawmakers in past years kept shoving off tough decisions, piling up red ink rather than cutting favorite programs or enacting temporary tax hikes. Those shortfalls born of political cowardice are still piling up.

The current fiscal year, ending June 30, is burdened with a shortfall, about $7 billion, that the bond issue won't touch. Schwarzenegger's proposed budget for the next fiscal year, if it's honestly toted up, still doesn't get rid of the gap between revenue and spending. The governor has said the old way of doing things in Sacramento is over, and a chastened Legislature seems to agree. Here's how to translate that into action:

* Legislators should start proposing budget savings now, not sometime after Schwarzenegger submits a fine-tuning of his own budget in mid-May. The Legislature's proposal is due in the governor's office June 15, and by law a budget has to be passed before July 1. Scheduled hearings next week on what could be saved may get the process going, but they also risk becoming soapboxes about what cannot be cut. If Democrats reject some of Schwarzenegger's cuts, they have a responsibility to offset them with other savings.

* The Schwarzenegger administration needs to be heavily involved in the process. The governor's finance director, Donna Arduin, should begin presenting as soon as possible the "waste, fraud and abuse" she and Schwarzenegger promised to unearth with an audit of state spending. Lawmakers then may differentiate real waste from programs or services the administration simply doesn't like. But they should not even appear to dismiss her findings out of hand.

* Give Schwarzenegger some breathing room on new taxes. Push will come to shove as the end of the fiscal year nears in late May or early June, but the governor has to see the need on his own. He's proved that he's capable of bipartisan compromise, and Democrats have to trust that experience.

There is nothing extraordinary about this agenda. It's what state legislators do when they're not in partisan gridlock. Californians will welcome the change.

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