November 16, 2005


LAO forecast: great news for governor (Daniel Weintraub, 11/16/05, Sacramento Bee: California Insider)

The LAO's new long-term forecast for the state's fiscal picture is here.

The bottom line is that her forecast could not be any more favorable for the Schwarzenegger Administration. Revenues are up, significantly, and expenditures are running a bit below forecast.

HIll projects that the state will end the current fiscal year with a positive balance of about $5.2 billion. That's $1.3 billion that was already budgeted as a reserve, plus about $1 billion more than had been assumed in higher revenues from prior years, and $2.9 billion in higher revenues in the current year.

She also projects that the ongoing, structural shortfall, which hasn't gone away, will shrink to $4 billion in the 2006-07 budget year, for which the governor will propose a budget in January.

What this means is that the governor, without tapping into his deficit bond reserve, raising taxes, or reducing projected spending, could propose a budget that uses this year's surplus to cover next year's shortfall, and have money to spare—about $1.2 billion in reserve. Interestingly, this scenario would include full funding for Prop. 98 (as currently defined) -- including the first funding for Schwarzenegger's long dormant Prop. 49 expansion of after school programs.

Basically, the three-year workout that he has said was his goal all along has nearly come to pass.

Given Iraqi troop drawdowns and the overwhelmingly favorable economic picture for next year, what do Democrats have to run on?

Posted by Orrin Judd at November 16, 2005 5:58 PM

This kinda reminds me of the WaPo recent headlines at the start of the "Bush polls are crashing" meme-storm.

The headline/lede was basically how unhappy voters are at our nasty President over "the progress of the war and the economy".

Huh?!?! The ECONOMY?? WHAT economy?? THIS one, that we are living right now??

THIS is the economy that voters are bitter and unhappy over. unemployment around 5%, taxes cut, revenues rising, not perfect, but I'll take it any time.

So the question is... is this poll preposterous? Or is it real, and the American voter is either insane, or hopelessly lost to childishness in a belief that anything less than perfection is obviously the fault of the US President, WAHHHHH, I WANT my perfection, WAHHHHH I stubbed my toe, WAHHHHH Hurricanes suck, WAHHHH I hate Bush!!!!

So it may not matter hugely that the numbers you point out are as good as they are. Children want to whine. It feels good. Feelings trump all.

Posted by: Andrew X at November 16, 2005 6:19 PM

Andrew: In this specific case, "economy" means "price of gasoline."

Posted by: David Cohen at November 16, 2005 6:36 PM

. . . and the price of gas has dropped at leas fifty cents a gallon in the last 2 weeks in California. I suspect nationwide, much the same has happened.

Posted by: obc at November 16, 2005 7:35 PM

Wild, irrational, unyielding, unending, spittle-emitting rage at the wonder-chimp that has beaten them time and again and prevented them from regaining their rightful place as masters.

What, were you expecting common-sense from the party of Howard "I have a scream" Dean?

Posted by: Mikey at November 16, 2005 8:48 PM

They have to (continue to) injure the country as much as possible between now and then. They run on the puddles of blood that stream from their black jack blows to America's head and face.

Posted by: JT at November 17, 2005 12:03 PM