After more than a decade of dealing with wave after wave of Budget deficits and failed solutions, we now have a Governor who has forthrightly said that he intends to offer a path to resolution of the structural fiscal imbalance facing the state. His proposed solution is based on two major themes--permanent reductions in state spending to solve half of a $25.0 billion problem, and a five-year continuation of temporary taxes to resolve the other half. We think this is a good plan, but neither of these solutions will be easy to implement.
We have detailed the political difficulties that face the Governor in getting the tax extensions even on the ballot, not to mention the hurdle of getting the electorate to approve those taxes. And acceptance by the Legislature of real cuts to programs on the noneducation side of the Budget will, in our opinion, be even more difficult. Those are the programs that have been repeatedly protected over the past decade while education has taken the deepest cuts in the history of the state. We do not think the Legislature, which has repeatedly ducked these cuts in the past, suddenly has an epiphany and steps up willingly.
Given that backdrop, the Governor has outlined two paths for education funding in the future. His preferred path is nearly flat funding for education, but he relies on the tax extensions to fund that option. The second path suggested by the Governor results in yet another substantial cut to public education.
On the natural, based upon current law and economic projections, the minimum Proposition 98 would fall by about $2.3 billion if the taxes are not extended. This is where the facts end and the speculation begins. We say that education must be prepared to absorb a hit of at least the $2.3 billion natural loss in Proposition 98 funding. But we also ask the question: "Will we be cut more than that if the taxes don't pass?"
The real answer to that question is that no one knows or can know at this point. Despite the leadership and goals of our new Governor, we still have the same partisan politics and poor economics we have faced for most of the past decade. Remember, California had a substantial Budget deficit hangover from the dot.com bust even before the current recession started. Gray Davis was recalled as a result of that fiscal crisis. Arnold Schwarzenegger came in like a lion on the topic of resolving the state's fiscal problems and left the situation worse than he found it. Neither of these Governors was able to generate support for cuts in the Legislature or more taxes from the electorate.
Will this Governor do better? We hope so, but that is by no means guaranteed. So, we return to the question of what happens if the taxes don't pass or, even if they do, the Legislature is unwilling to make the noneducation cuts that comprise the rest of the solution? Some speculate that the Governor pushes for even greater education cuts to balance the loss of taxes or the absence of other Budget reductions to continue to try to eliminate the deficit anyway. We think that is an unreasonable assumption.
The Governor can lead, but will be effective only if he is followed. And if he does not have the support of the people on the revenue side and the support of the Legislature on the spending side, any plan he develops is doomed. We have paid little attention to doomsday scenarios where education is cut far beyond $2.3 billion; some have speculated that our 40% of the Budget would yield an additional cut of up to $10.0 billion for education. Could that happen? Yes, anything can happen, but we simply do not think that scenario is anywhere near probable.
What do we think is probable? Without the support of both the Legislature and the people of California, we think this Governor is doomed to the same fate as his predecessors. A patchwork of hand-to-mouth solutions that allow the state to continue to limp along until the economy turns in our favor. In the year with the biggest shortfall to date, 2009-10, with its breathtaking $60.0 billion shortfall, the state addressed less than $10.0 billion in reductions, declared the Budget balanced and kicked the rest of the problem down the road. For the current year, 2010-11, in October right before the elections, the state claimed to have addressed a $19.9 billion problem, but less than eight weeks later declared that it had a $25.0 billion problem. The state has proven that, despite assertions otherwise, it can kick this can down the road for a very long time. Without the full support of the people and the Legislature, we think that is the most likely result for 2011-12. After all, if the Legislature will not vote for $12.5 billion in cuts, is it reasonable to assume they will vote to cut $25.0 billion?
We think that far too much of the debate is currently focused on how bad it will be for education if the taxes fail or the Legislature doesn't act. We think the correct question is, "What can we do to help the Governor achieve his goal of balancing the Budget while, for the first time in a decade, protecting public education?" We think that course is clear. We can help both the Legislature and the electorate to see the disproportionate cuts that education has already taken and the impact of those cuts. We can work to promote extension of the temporary taxes, first by the Legislature and then by the electorate. We can urge the Legislature to act on the cuts proposed by the Governor, if not within 60 days, at least by the time of the election. We can lobby local legislators and legislative leaders to address the issues in a bipartisan way in order to put the Budget problems behind us. We can offer the Governor our voices, joined with his, in support of his quest for a solution.
We will finish as we began--the Governor can't do it alone. If we care about our children, if we care about the future of public education and the future well-being of our state, all of us have to get off the dime and step up to the plate with the Governor. Both he and our children deserve that effort from us.
--Authored by the Staff at School Services of California, Inc.