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Jerry Brown On California's Budget Deficit: 'Cutting Alone Really Doesn't Do It'

By JUDY LIN 05/15/12 10:12 AM ET AP

SACRAMENTO, Calif. -- California Gov. Jerry Brown called on state lawmakers to embrace austere cuts and urged voters to approve tax hikes in outlining a revised budget.

Brown on Monday proposed $8.3 billion in cuts across education, health care and welfare programs in laying out a plan to address the state's $15.7 billion shortfall, an amount equal to 17 percent of the state's discretionary fund. He warned that additional cuts are ahead if voters reject his tax-hike initiative in November.

"Cutting alone really doesn't do it," Brown told reporters in releasing his $91 billion general fund budget plan. "And that's why I'm linking the serious budget reductions – real increase to austerity – with a plea to the voters: Please increase taxes temporarily on the most affluent and everyone else with a quarter of a cent sales tax."

Brown, a Democrat, also is asking state workers to share the pain by taking a 5 percent pay cut, most likely by reducing their work hours. The pay reduction would be handled in contract negotiations with the state's public employee unions.

In addition to the cuts, Brown hopes to close the deficit with $5.9 billion in new revenue from the tax initiative he proposed earlier this year that would temporarily add a quarter cent in the state sales tax and collect higher income taxes on those who make $250,000 a year or more.

If voters reject the tax increases in the fall, Brown is proposing $6 billion in additional automatic spending cuts, almost all of which would fall on K-12 schools. The so-called trigger cuts could mean that some districts would have to cut the school year by up to three weeks.

Brown said the cuts are real and will impact every school in the state. He likened California's fiscal challenge to the federal government and European nations, including Greece and Spain.

"Given the decade of fiscal disconnect, I've committed to righting the ship of state and getting it into balance," Brown said. "What that means is that things that are good in and of themselves have got to be stopped or curtailed if we are going to have balance. Otherwise we borrow and sink deeper into debt."

Brown said California's sputtering economic recovery is putting a heavier-than-expected drag on state tax revenue. The state has been blocked from making cuts to Medi-Cal and In-Home Supportive Services in court and by federal requirements.

The revised budget deficit is $6.5 billion more than the $9.2 billion gap Brown anticipated in January.

Brown called for cuts that would reduce child care for mothers trying to get off welfare, in-home supportive services for the needy and health care for the poor, as well as cut funding to courts and postpone payments to schools. Those reductions come on top of tens of billions of dollars in state budget cuts implemented since the recession started in late 2007.

Another $2.5 billion would involve delaying paying debt and other internal borrowing.

Democrats who control the Legislature said they would cut as much as they can while trying to preserve what they deem essential services. Senate President Pro Tem Darrell Steinberg, D-Sacramento, said Democrats are not looking for a public fight with the governor.

Republicans said the majority party has refused to enact reforms such as public worker pension and teacher accountability.

"When you have unsustainable policies, you have unsustainable budgets," said Republican Senate leader Bob Huff of Diamond Bar.

Brown said his balanced approach was a fair and reasonable way to balance the budget. The sales tax increase would last four years while the income taxes on the wealthy would be raised for seven.

Public schools, which account for about 40 percent of state spending, would see a funding increase of 16 percent if voters approve Brown's tax initiative. More money also would flow to the state's three higher education systems, which have been the subject of student and faculty protests as courses have been cut and tuition has soared in recent years.

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SACRAMENTO, Calif. -- California Gov. Jerry Brown called on state lawmakers to embrace austere cuts and urged voters to approve tax hikes in outlining a revised budget. Brown on Monday proposed $8.3 ...
SACRAMENTO, Calif. -- California Gov. Jerry Brown called on state lawmakers to embrace austere cuts and urged voters to approve tax hikes in outlining a revised budget. Brown on Monday proposed $8.3 ...
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darkmark
religion, the veil of evil.
10 hours ago ( 7:08 PM)
good to have a serious head of state in charge. of course there are the emotionalists that don't believe in good government. they're here to tell us all that taxes are bad. they are bad duh. let it go bubba. a corporatist state is the worst and that's what you get when you follow their lead and cut, cut cut taxes and destroy unions.
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HUFFPOST SUPER USER
El Chingaso
Fighting for mental superiority...
22 hours ago ( 7:15 AM)
"[B]rown [...] urged voters to approve tax hikes in outlining a revised budget."

Earth to Moonbeam. [Static.] Earth to...Moonbeam. [Static.] Come in, Moonbeam. [Garble.]

Additional tax revenues are just an illusion, like a false echo return on radar. Disregard these hallucinations, and prepare for a rough, realistic re-entry to...the real world. [Feedback.]

So hurry down...and cease all this foolishness about K-12 cuts. Cali's public ed system...is a foregone conclusion. No longer worthy of additional infusion(s) or emotional blackmail. [Momentary silence.]

Deploy the 'chutes -- now!

[Stay tuned.]
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billy goat
Sniffing Out Bad Cheese Everywhere!
06:14 PM on 05/16/2012
What exactly is the "reform" touted in the headline? We've heard all this other crap before. Are we working on a structure to taxation that minimized the boom and bust unpredictability that occurs each year?
This user has chosen to opt out of the Badges program
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05:41 PM on 05/16/2012
Brown is too lazy to even start the reforms needs. He is right, cuts are not enough. But he needs to reform spending such as K-12, pensions, etc. A bottoms up restructuring. He is looking for the easy way out, cuts and taxes.
01:33 PM on 05/16/2012
"Brown, a Democrat, also is asking state workers to share the pain by taking a 5 percent pay cut, most likely by reducing their work hours." How does that make sense? If you have 5% too many people for the work you should let some go. If you have the right amount then eliminating 5% means longer lines and less service. How about looking at pension reform? There are 24,811 retired California teachers receiving more than $75,000...vs. a state median income of $68,000. Easier to close state parks.
12:16 PM on 05/16/2012
How are you going to do it Jerry? How are you going to tell the people of California, that you and others have promised the moon, that you were wrong? That all the lies you told and all the govt handouts were nothing more than temporary tricks to get their votes? Now, you have all these dependent people that have been attracted to your state by all these lies. What are you going to tell the gangs in LA when you can no longer send money in to keep them quiet? Your in trouble Jerry, just like your buddy in Washington. When will the people wake up and realize, that if it is too good to be true, it probably is? All these promises of something for nothing have been going on since the beginning of mankind, and they always end in complete failure and chaos. WAKE UP PEOPLE!
11:10 AM on 05/16/2012
I've lived in several states, but here in CA my taxes are the highest ever...property tax, income tax, sales tax, business tax, SDSUI, DMV, etc.

If Jerry Brown thinks I'm going to vote myself another tax hike he's nuts!
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HUFFPOST SUPER USER
Jose Soberanes
It's your responsibility to succeed!
10:11 AM on 05/16/2012
As a life long Californian I am sick of the taxes that we pay as business owners. I fully understand why people and business are leaving. If I could leave, I would but I can't, to many people depend on me. Since 1972 the democrats have controlled this state and this is what 40 years of policies has done to his great state. Thanks to over regulation, taxes and employee pay and benefits and we are now on our way yo bankruptcy. The majority of Caliornians will not pass his tax request in November, why? Because we are sick of the spending!
12:21 PM on 05/16/2012
What a reason to stop the giveaway mentality in WashingtonD. C.. Things need to change quickly or we are looking at the same thing on a national level. There is only one thing to do.......don't allow the debt ceiling to rise. Starve the beast by cutting off its money! Not one more cent of debt spending.
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darkmark
religion, the veil of evil.
10 hours ago ( 7:11 PM)
you might have heard that before reagan corporations paid for over 50% of the taxes in california. now they pay less than 7%. dam how did we get into such a jam?
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HUFFPOST SUPER USER
Jose Soberanes
It's your responsibility to succeed!
6 hours ago (10:31 PM)
What? It's 8.84 plus the federal tax....it's ridiculous! That is why they are leaving! It's the liberals who have destroyed the state with taxes and regulation...pathetic!
09:36 AM on 05/16/2012
censors? at Huffington, huh... you people should pay me for my commentary.
01:05 AM on 05/16/2012
Why would anyone in their right mind vote for more taxes and throw even more money down this bottomless-pit of a state?
HUFFPOST SUPER USER
sdried
12:35 AM on 05/16/2012
California is to the US what Greece is to the EU.
REDSTATEREFUGEE
Texan by birth ; Californian by choice
11:27 PM on 05/15/2012
I admire Governor Brown, who, like Sisyphus, is struggling uphill against a large, formidable, Republican legislative minority who simply will not relent in their reluctance to approve a necessary tax increase. Those who doubt that another reduction in funding for the big three---education, public safety, and social services/health---will be devastating need only consider a couple of items. In public schools, already, in some areas, senior English classes are approaching 40 students per classroom....an untenable teaching load, exacerbating an already declining situation in reading and writing.

When travelling state highways, I see fewer and fewer CHP officers, encouraging careless motorists to take more risks. In addition, our highway system is deteriorating. I have struck potholes that felt like my car had hit an IED. Finally, a less readily-observed effect is the pain and suffering enacted upon those less able in our society, the ill, the impoverished, the aged, and the handicapped.

As Governor, Jerry Brown has no choice but to continue to cut our expenditures, thanks to Republicans in Sacramento.
01:08 AM on 05/16/2012
The tax increases only close the current deficit and do nothing to repair the problems that you list much less the deficits that will occur in the years ahead.
REDSTATEREFUGEE
Texan by birth ; Californian by choice
11:43 AM on 05/16/2012
Supports for your generalization? Thanks.
02:08 PM on 05/16/2012
California has been spending plenty, but I agree we seem to be getting less and less from it.

1990 = 30 million people, $50 billion budget == $1700 per capita
2007 = 37 million people $130 billion budget == $3540 per capita

Inflation had an effect but the spending per capita has clearly accelerated...without much benefit to the citizens.

It is interesting to note that CA spends $46,000 per prisoner (19,000 of which are illegal immigrants) vs. a national average of $26,000. But Brown is unable to take on the prision guard union. So it goes.
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ConservativeSuperstar
I have more FLEXIBILITY after the election
10:40 PM on 05/15/2012
I love it whenever the Lefties trot out the following;

1) Moon Beam Brown - The master of failed economics. The disaster started when a young Governor Moon Beam allowed collective bargaining for public sector unions in 1977. Plus, they don't secure the border either.

2) Bev "Foot in the Mouth" Perdue - Every time she opens her mouth its a few more votes in North Carolina. Keep talking Bev.

3) Jenny Granholm - The architect of the "One State Recession" from 2000 to 2008. All of the other states were doing fine but Jenny somehow managed to preside over the worst economy in the country. But at least she taught the people of Michigan a key lesson which is DON'T GIVE LEFTIES ANY POWER.
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darkmark
religion, the veil of evil.
10 hours ago ( 7:14 PM)
right wing clowns using old right wing name calling, why? its the best they can do. pre reagan, corporations paid for over 50% of the states taxes. now they pay under 7%.
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GoldwaterKid
Vote Person, Not Party
10:22 PM on 05/15/2012
Governor Brown is the right person to be in charge at this time. I voted for this guy, and he is the only one who doesn't really care what the DNC thinks or the GOP.

Time to do what is good for California Jerry and our future.
REDSTATEREFUGEE
Texan by birth ; Californian by choice
11:35 PM on 05/15/2012
X 1530, GK.....Please see my lengthy comment above, which did not properly recognize in full how admirable Governor Jerry is. Like you, I respect the courage of his convictions, which are largely non-partisan and realistic. Rather than being dismissed as "Governor Moonbeam" by some conservative posters on HP, he has proven to be a capable, results oriented administrator.
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HUFFPOST SUPER USER
Roosevelt Democrat
09:56 PM on 05/15/2012
Governor Brown you are treating the symptoms but you're not looking for a cure!

Last time you were governor this state was a Manufacturing Dynamo! Look at us now! Just in the last 10 years we have lost over 35% of our manufacturing jobs! We thought the high tech jobs were going to be a savior but we lost them at an even higher percentage!

It's energy cost Governor! AZ cost for industrial electricity is about $0.07/kw. OR is about $0.06/kw and WA is $0.04/kw! California's is almost $0.14/kw!

We need to green California but there are smarter ways!

If you were to encourage Co-Gen a manufacturer could first generate electricity for others and use the waste heat to dry their product or create steam for their plant usage! Allow the company to sell the electricity back to the grid. Currently the best natural gas generators operate at less than 50% efficiency but with co-gen this number can go up to 80-85%. Mandate an 80% efficiency level. The manufacturers are using the natural gas anyway let's as a State improve our energy efficiency.

There's more to greening this state if you want to maintain a manufacturing base than solar panels and wind generators!

The real key to lowering our carbon footprint is efficiency and the funny thing is that's how we create jobs!

Please, take a moment and think outside the the establish corporate green box!