Schwarzenegger’s Budget Addresses Few Structural Issues
by ilene - May 15th, 2010 10:32 am
Schwarzenegger’s Budget Addresses Few Structural Issues
Courtesy of Mish
Tonight, with much fanfare, Schwarzenegger released his proposal to fix California’s $19 billion budget deficit. It was a huge disappointment.
Schwarzenegger had a golden opportunity to propose radical changes like privatizing the prison system, privatizing work in general, sending illegal aliens home, or getting rid of defined benefit plans. Instead, Schwarzenegger wimped out on many key issues.
Budget at a Glance
Please consider some highlights from Schwarzenegger’s revised state budget at a glance
Close the $19.1 Billion Deficit Through:
- $12.4 billion in spending cuts.
- $3.4 billion in federal money.
- $3.3 billion in other measures, primarily through borrowing from other state funds.
Spending Cuts Breakdown
- $1.1 billion through the elimination of CalWORKS, the state’s primary welfare program, which serves 1.4 million people, two-thirds of them children.
- $750 million in unspecified cuts to the state’s in-home supportive services program for the disabled, achieved through reductions in wages and services.
- Cuts $532 million from Medi-Cal, the state’s medical program for the poor, by reducing eligibility, limiting doctor’s visits to 10 per year, reducing funding for hearing aids and other medical equipment, and increasing copays.
- $811 million reduction in prison health care expenses by making the system more efficient and reducing funding.
- About $360 million in savings by shifting nonviolent offenders out of state prisons and into county jails and by reducing the juvenile prison population and closing the facilities that house them.
State Employees
- Payroll reductions of 5 percent across all state departments, except for constitutional offices, which already achieved 5 percent reductions. The administration says much of the payroll reduction can be achieved by departments not filling current vacancies.
- A 5 percent pay cut for all state workers and a 5 percent increase in their pension contributions. The administration says this will save $1.6 billion.
Media Reporting
As soon as Schwarzenegger released the budget, the media was all over it. The LA Times headline says it all: Schwarzenegger’s budget deals blows to the poor.
Proposing a budget that would eliminate the state’s welfare-to-work program and most child care for the poor, Gov. Arnold Schwarzenegger on Friday outlined a stark vision of a California that would sharply limit aid to some of its poorest and neediest citizens.
His $83.4-billion plan would also freeze funding for local schools, further cut state
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
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