Today the State Senate hastily called up and voted on the Democrat version of the state budget.  Attached below is Senator McClintock's floor statement from just a few hours ago in opposition to this exercise in fiscal mismanagement, which in the end failed to garner the required two-thirds majority to pass out of the Senate.

Senator McClintock stands firmly in support of the Governor's budget and will continue to fight alongside the Governor for its passage.  Contact your Assemblymember or Senator to urge them to likewise support the Governor's budget proposal.

We are nearing the June 30th reporting deadline that will demonstrate which candidates have the fiscal resources to succeed.  Please visit our website at http://www.helptom.com and with a generous contribution you can help Senator McClintock continue his fight for fiscal discipline on which depends the very future of our Golden State.

Igor Birman
Finance Director

SB 77 – Democrats Budget
Senate Floor Speech by Senator Tom McClintock
June 15, 2005

We have once again been assured that this is a balanced budget. I remember the same assurances from the same quarters last year and the year before that. They have no credibility.

Here is what the Legislative Analyst's Office reported on Monday regarding the state's general fund. The LAO estimates that we'll close the current fiscal year having spent $82 billion and received $80 billion, ending that year $2 billion in the red.

This budget, they estimate, will spend $89 billion and receive $84 billion, ending the budget year an additional $5 billion in the red. You're not even heading in the right direction.

Three numbers tell you a lot about this budget: 5, 6 and 9. Five percent is the LAO's estimate of combined population and inflation growth next year. Six percent is their estimate of revenue growth. Once again, our revenues substantially exceed inflation and population growth. Once again, this is not a revenue problem.

Nine percent. That's the problem. That's the growth in state spending in this budget. By means of comparison, the average growth of general fund expenditures during the Davis years was not 9 percent - it was 6 percent. So this is very much in the tradition of the budgets that got us into this mess. In fact, it is measurably worse than the budgets that got us into this mess.

I would once again remind you of the First Rule of Holes: "When you're in one, stop digging." You folks are digging faster.

Now how is it that some Senators can even pretend the budget balances? Because of billions of dollars of borrowed money either carried over from last year or new borrowing contemplated in this conference report. But I have news for you: borrowing is not revenue. Borrowing is what happens when you're spending more than your revenue.

It has been suggested that there is a nefarious effort to hold the budget hostage by forces outside the legislature. What nonsense. Once the Governor places the budget on our desks on January 10th, it ceases to be his budget and it becomes the legislature's budget. When the Governor took office, I warned that the same legislature that got us into this mess was not going to get us back out again. I thank you, my Democratic colleagues, for so effectively backing me up on that.

One other point. These are issues that the legislature once worked through on its own when the constitutional budget process was honored. But by abandoning that process, the leadership has by-passed all the debates and negotiations and give-and-take that once produced relatively balanced and relatively on-time budgets. The new process is to present a conference report to the legislature for a take-it-or-leave-it vote at the 11th hour with no opportunity for those discussions to take place.

And the result is another horribly unbalanced budget - measurably worse than the budgets passed during the Davis years that racked up $26 billion of deficit-related general obligation debt - all for our children to enjoy.

So let's be clear. According to the LAO, their latest estimate of the current year operating deficit is $2 billion. This budget has an operating deficit of $5 billion. While population and inflation will grow 5 percent and revenues will grow 6 percent, spending will grow 9 percent. An AYE vote on this bill endorses a spending plan substantially less balanced than last year's, and growing substantially faster than it grew during the Davis years.

Bon appetit.