Analyst Calls Brown Budget “Good Starting Point.” Yawn

In a report today, the Legislative Analyst Office has declared Gov. Brown's budget "a good starting point" for addressing the state deficit. This has drawn quick headlines and media praise that suggest the LAO represents validation that Brown's budget may get on us the path to fixing things in California.

I suggest that it's worth holding the champagne. I went back and re-read the LAO's executive summary of Gov. Schwarzenegger's budget, and the language is remarkably similar. Consider today's summary of Gov. Brown's budget which reads in part:

"We believe the Governor's proposal is a good starting point for legislative deliberations. It includes reductions in nearly every area of the state budget and a package of revenue proposals that merit serious legislative consideration. We credit the Governor's efforts to craft a budget plan that focuses on multiyear and ongoing solutions, and his proposals to realign state and local program responsibilities and change local economic development efforts have much merit. Still, there are some significant risks in his plan and some optimistic savings assumptions."

And compare with it the summary of Gov. Schwarzenegger's very first budget proposal in January 2004, which called its proposal "a solid starting point":

"We believe that the Governor's proposal provides a solid starting point for budget deliberations. It includes realistic revenue and caseload assumptions, as well as real and ongoing solutions from most areas of the budget. At the same time, however, it presents the Legislature with numerous policy issues and concerns."

The LAO does wonderful work, so why does it stay upbeat even as the budget hole remains. Because the LAO's projections don't have any way of accounting for just how broken the state's governing system. The LAO can't account for the fact that in each election cycle, new initiatives can impose new holes in the budget. And the LAO can't accurately anticipate how the budget system leads to deals in which new budget costs are required to win over the votes needed to pass the budget (these are usually tax cuts or new spending that Republicans demand as the price of their votes). 

So Gov. Brown, like Gov. Schwarzenegger, is offering a budget that makes things better. The trouble is that the budget system never stops working to make things worse.

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