Gov. Arnold Schwarzenegger: Waste is killing California

Medi-Cal is another example. It's an essential program to nearly 7 million Californians, but it's growing by 8% per year because of rising healthcare costs, increased caseloads and various changes to the program. It's now unaffordable and unsustainable. I've proposed a couple of simple fixes, one of which is to centralize and modernize the outdated, pen-and-paper eligibility process that is currently run by 27,000 employees scattered throughout our 58 counties. This one change would save approximately $500 million per year.

These ideas are not new. But there has never been a Legislature willing to betray its masters and work for the benefit of the people over certain special interests. That's certainly true of reforming retirement promises to state employees. No long-term fix is more important to our state's solvency. That's why I've proposed -- for new hires only -- to change our unsustainable retiree pension formulas and to require proper funding of promises when they're made.

In 1999, state employees' pensions were increased to a point where some employees could retire after 30 years, at as young as 50 or 55, and continue to earn 90% of their highest salary plus cost-of-living increases for the rest of their lives. That's debt the state is obligated to pay although there is no money to pay for it. The debate on this increase on the floor of the state Senate in 1999 took only one minute. By simply taking another 60 seconds to return pension formulas for new hires to their pre-1999 rates, we would see a savings of nearly $95 billion in reduced pensions by 2040, with more billions to be saved beyond that.

When it comes to In-Home Support Services, grand juries in six counties have found that the program has no safeguard against fraud. Care providers are able to collect state checks under aliases, and some providers bill the state for far more hours than they worked -- with no oversight. The current state of the program puts clients "at risk of physical and financial injury," according to Ventura County's grand jury. Requiring background checks of providers and hiring more fraud investigators could save the state hundreds of millions of dollars this year alone.

Legislators want to save programs. Well, let's save them, but let's do it by getting rid of the fraud and waste, with common-sense reforms that will make government more efficient and reduce costs. Put together, the ideas I've laid out will save approximately $2 billion in this current year -- toward our $26.3-billion problem -- and phenomenally more in coming years.

The writer Arthur C. Clarke said good ideas come in three phases: 1) "It can't be done," 2) "Sure, it can be done, but it's not worth doing," and 3) "I said all along that it was a good idea." In Sacramento, legislators are still stuck at No. 2 when it comes to reforming some of state government's bureaucracy. But I'm confident it won't be very long until we're all agreed that these reform proposals have been good ideas all along.