LAT identifies CA fiscal culprits

The LAT, on the front page today, identifies what it says are the main reasons why California's government is in such poor shape fiscally. The main culprits, it says, are Proposition 13 and the requirement that tax increases receive a two-thirds vote in the legislature.

The LAT's implicit conclusion is that California has a revenue problem, not a spending problem. Absent Proposition 13, property taxes would bring in more revenue. Absent the two-thirds requirement, the Democrat-controlled legislature would have raised income and sales taxes. Absent the two handicaps, the budget would be balanced, the LAT apparently believes.

But spending would have increased to absorb any new revenue. The only restraint on spending is the requirement that the budget be balanced. Even that is not much of a restraint because the requirement is violated each year as the state borrows and uses accounting gimmicks to make the budget appear to be balanced.

Facing a $17 billion budget deficit, the legislature and the governor have plans for future new spending on infrastructure, health care and global warming. They just have no plan for how to pay for the new spending.