Taking Aim

The Governator sets his sights on California’s finances

By Alisa Farenzena
From the February 2005 Print Edition

Governor Arnold Schwarzenegger aptly summed up California’s financial situation in his State of the State Address when he declared, “We don’t have a revenue problem. We have a spending problem.” It is apparent from the January 5 speech that this is the common-sense attitude underlying Schwarzenegger’s plans to help alleviate the state’s longstanding financial troubles.

First and foremost is his opposition to higher taxes; the governor sensibly realizes that taking in more tax money “would only further drive up spending by billions of dollars.” Limiting spending is at the core of Schwarzenegger’s economic plan, which is a particularly positive change since the Terminator originally made a political name for himself with a ballot proposition to establish costly after-school programs in public schools across the state.

As an argument for keeping a closer watch on the state’s pocketbook, he addressed one popular contention of the left — the need for more school funding — pointing out that the quality of our schools is not determined by the amount of money we spend on them. “Nearly half the state’s budget,” he reminded listeners, “is dedicated to education” — yet we are still plagued with substandard performance. Schwarzenegger realizes that you cannot fix a problem by simply throwing more money at it, but that actual substantive change must be made. Following this line of reasoning, he has proposed improving education by linking teacher salaries “to merit, not tenure,” and firing ineffective teachers rather than keeping them on the payroll despite repeated failure.

To many of us, these plans sound great on paper, but in the reality of California politics, a legislature full of tax-and-spend liberals will try its hardest to prevent common sense and fiscal responsibility from prevailing. In each legislative session, these lawmakers attempt to raise taxes and increase spending in increasingly bizarre ways. For example, Assemblywoman Sally Lieber last year put forth AB 2494, a new tax on businesses that would require California grocery stores that pay their employees “poverty wages” to “reimburse health and human services agencies throughout the state for health and human services.”

Schwarzenegger must brave the storm of opposing philosophies from politicians on the other side of the spectrum and stick to his refusal to raise taxes — which will, in turn, require him to keep his commitment to limiting spending in order to achieve a balanced budget.

Additionally, and not surprisingly, the governor faces an uphill battle with the California Teachers Association (CTA) over his ideas for merit-based pay and dismissal of ineffective teachers. One of the most vocal special-interest groups in the state, the teachers’ union looks out for its members’ own interests, rather than those of the children or taxpayers, and thus stands in the way of accountability.

Beyond the State of the State address, Schwarzenegger has continued to propose sound ideas for pulling California out of its financial troubles. In his January 10 budget plan, according to a January 15 San Francisco Chronicle report, Schwarzenegger proposed the suspension of Proposition 98, which “dictates how much money schools receive.”

Prop. 98 is a rigid formula that the teachers’ union invented when Governor George Deukmejian in 1988 “tried to balance the state budget by trimming education spending,” according to the January 23 edition of the Chronicle. Schwarzenegger has voiced his intention to make the state work more efficiently by diminishing the influence of special interests, and the CTA is one of the most obtrusive special-interest groups in the state. Suspending Prop. 98 would put the CTA in its place and send a message to similar groups that the interests of California’s citizens come first.

Moreover, enslaving lawmakers to strict spending formulas like the one mandated by Prop. 98 often proves shortsighted and impractical when trying to find innovative ways to deal with a budget deficit. What we need are ways to cut spending — not sustain it.

What remains now is for Schwarzenegger to hold to his refusal to raise taxes and his commitment to limit spending — no small feat considering the big spenders he is up against. The budget process will naturally involve compromise, and to gain support he will have to make some concessions, but that must not cause the governor and his colleagues in the legislature to stray from the principle of fiscal responsibility. It is imperative that we solve California’s spending problem.

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