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Contributor
John
Campbell
John
Campbell (R-Irvine) is an Assemblyman representing the 70th
District
in Orange County. Mr. Campbell is the Vice-Chairman of the Assembly
Budget Committee. He is the only CPA in the California State
legislature
and recently received a national award as Freshman Republican
Legislator of the Year. He represents the cities of Newport
Beach,
Laguna Beach, Irvine, Costa Mesa, Tustin, Aliso Viejo, Laguna
Woods and Lake Forest. He can be reached through his Assembly
website
and through the website
for his California Senate campaign. [go to Campbell index]
 Digging
Out
The Governor unwinds Gray Davis' fiscal mess....
[John Campbell] 5/24/04
It took Davis
Democrats 5 years to dig the state of California into the miserable
fiscal hole which Governor Schwarzenegger
inherited. Arnold will need more than one year to dig out of
that 5 year hole, particularly since many of the Davis Democrats
who helped dig it are still in office. But last week, the Governor's
proposed budget made a good start.
It balances the budget with no increase in taxes. It is also
likely to pass the legislature with relatively minor modifications
in the month of June, which would also make it a rare on-time
budget.
But, as has been noted by a number of critics, it does not solve
the entire budget crisis. Next year and the year after that will
still contain deficits, albeit reduced ones, if the Governor
does nothing else. But he won't do nothing. There are at least
4 major structural changes the Governor wants to enact that will
close that ongoing budget deficit. They are:
1) Implement
the California Performance Review - This is the complete restructuring
of
state government organization that
the Governor describes as "blowing up the boxes." A
team of over 100 people have been working on this for months
and it has the potential to save billions of dollars annually
through streamlining and updating the bureaucracy.
2) Pension
Reform - The pension system for state employees is
overly generous and must be reformed if the state is to avoid
future fiscal crises. He has proposed a plan that would save
over $4.6 billion over the next 20 years.
3) MediCal
Reform - The Medi-Cal system has a budget of over
$28 billion annually, but experts estimate that as much as 10%
of the budget is lost due to fraud. Additionally, at a time when
medical cost are rising, Medi-Cal's inefficiencies have resulted
in $3 billion in cost increases over the last five years. The
Administration intends on submitting a plan by late summer to
reform Medi-Cal to increase the efficiency of the program, while
maintaining health coverage for over 6 million Californians.
4) Economic
Recovery - By fixing worker's comp, lowering energy
costs, enacting tort reform and tax reform, California can again
become a job creating engine. When that happens, tax revenues
will go up because more people are working and making more money,
not because tax rates have been raised.
These things will take some time to design and implement, but
there are real and permanent savings to be had over the next
few years that could balance our budgets if we restrain spending
growth elsewhere.
Does anyone want to bet against this Governor's ability to get
this done? Not me. CRO
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