I saw Arnold Schwarzenegger being interviewed by John Harwood and he told him on CNBC I believe that " we missed the iceberg." No we didn't. The budget is a disgrace and Californians are going to learn the hard way what has happened in our state. Jobs and services will be slashed at an incredible rate and we;ll all suffer for it. Even if Arnuld thinks we missed the iceberg, the state is going to sink to the bottom of the ocean.
So the Assembly is wrapping up their budget session, and it turns out that the Assembly came up $1.1 billion dollars short of the Senate's solutions. Oil drilling failed, and the local government raid on HUTA (gas taxes) failed as well.
So where does that leave us? These bills will go to the governor, and since there isn't concurrence, it will be roughly a $23 billion solution rather than $24 billion. But, the Governor has a line-item veto. He can make various cuts with his blue pencil. But $1.1 billion? Who knows. That seems like a tall order.
Considering what Schwarzenegger did the last time a partial solution was handed to him, I guess there's an outside shot that he'll just say no and open a new extraordinary session. But he'll probably just line-item some, and maybe make up the difference by eating into what is now a $900 million dollar budget reserve.
Is everybody ready to be back here in October?
...We'll have a couple days for final analyses, but let's remember that this is a terrible budget and a dark day for California.
...Let me clarify. The Governor can make line-item cuts but he doesn't necessarily have to, because this is a budget revision. He can also shift around the size of the reserve. In the end, he doesn't actually have to be in balance for a revision; that's a Constitutional need at the beginning of the process, as I understand it, not now. Clearly from the Governor's remarks, he's not going to veto the whole thing, so this is the "solution," for now. There also may be Constitutional problems with some of the stuff passed.
