Contributors
Jon Coupal- Columnist

Jon Coupal is an attorney and president of the Howard Jarvis Taxpayers Association -- California's largest taxpayer organization with offices in Los Angeles and Sacramento. [go to website]

Budget Busting Panel Needed
To Solve State's Fiscal Woes
[Jon Coupal and Tom Schatz] 10/4/03

When he was governor of California, Ronald Reagan established a private sector commission to make recommendations on how to eliminate wasteful spending and make the California state government more efficient. Four decades later, with the state facing its worst fiscal crisis and on the verge of recalling its current governor, Gray Davis, for gross fiscal mismanagement, it is imperative to look to the past for guidance in order to escape the $38 billion deficit.

As President, Reagan implemented federally what he had done in California by creating the Grace Commission, consisting of 161 senior business executives and more than 2,000 private sector volunteers, to conduct a comprehensive review of the budget. The final report made 2,478 recommendations to eliminate waste, mismanagement and inefficiency in Washington, equaling a potential savings of $424 billion.

One of the most successful ideas implemented from the Grace Commission was the Base Realignment and Closure Commission (BRAC). Before BRAC, Congress had been unable to close unnecessary military bases because members of Congress simply lacked the courage to close bases in their districts and states. But in 1988, Congress delegated authority to BRAC to create a list of superfluous military bases. That same year, Congress voted in favor of an omnibus base-closing bill containing a slate of military bases submitted by BRAC.

The secret to the success of BRAC was that it spread the base closings throughout the country and no member of Congress could claim that his district had been singled out. By casting a broad net, the omnibus bill galvanized a majority coalition. BRAC produced base closings again in 1991, 1993, and 1995, saving taxpayers $25 billion.

A California budget commission should be modeled after the Grace Commission and BRAC. This budget realignment commission should go over the state's finances with a fine-toothed comb, uncovering the waste and suggesting various programs for elimination. Those suggestions should be written into an omnibus, stand-alone legislative bill. The un-amendable bill should then be subject to an up-or-down vote of the Assembly and Senate within a specific time period. That process would have the effect of keeping special interests out of the amendment process, and force the legislature to make tough decisions.

In its quest to cut government waste, the budget commission could start by reading the California Piglet Book, published by Citizens Against Government Waste and the Howard Jarvis Taxpayers Foundation. The California Piglet Book details waste and duplication in the state budget, identifying more than $5.1 billion to be saved through the creation of a leaner and more efficient California government. The Piglet Book's recommendations run the gamut from eliminating fraud in the Medi-Cal program to disallowing state employees to call psychic and sex hotlines from office phones.

The host of candidates bidding to take control of the Governor's Mansion have provided several diverse plans to rid California of its $38 billion deficit -- some more entertaining than others. Actor-turned-politician Arnold Schwarzenegger has promised that the first step he would take as governor is to conduct an independent audit of the state's budget. State Sen. Tom McClintock sponsored legislation that would create the Bureaucracy Reduction and Closure Commission, modeled after the federal Base Realignment and Closure Commission; it would identify and eliminate wasteful and duplicative programs in the state government.

On the opposite side of the spectrum, Lt. Governor Cruz Bustamante's Tough Love plan calls for an $8 billion tax increase and $4 billion in spending cuts. Raising taxes will not solve the root problems associated with wasteful government spending. Waste is waste, regardless of whether the state is operating in the red or the black. California already claims the sixth-highest state and local tax burden, and businesses in the state face the second worst tax system in the country. Increasing taxes would only drive more businesses and jobs out-of-state, further depressing the economy and causing the state to lose much-needed revenue.

It was not long ago that California basked in a $12 billion budget surplus. In order to return to prosperity, Gov. Davis, or whoever replaces him, and the legislature have plenty of tough decisions to make. A well-designed government waste commission could make their jobs a lot easier.

Jon Coupal is president of the Howard Jarvis Taxpayers Association. Tom Schatz is president of Citizens Against Government Waste. They are co-authors of The Piglet Book, which is available on this site.