The Golden State has long been the signature term that defined California. The label reflected our state’s promise, its apparently unlimited resources, its natural beauty and the talented men and women who choose to make it their home. Today, California’s image is far from golden, and its future appears uncertain at best.
The much delayed, nearly $100 billion state budget passed by the Legislature and recently signed by Gov. Gray Davis still leaves California with an $8 billion deficit that must be addressed in the next fiscal year — and that deficit could grow to over $10 billion. The budget also authorizes the state to sell nearly $11 billion of bonds, to be repaid over five years, in order to finance this year’s cash flow requirements; borrows another $2 billion to pay for the state’s obligation to the retirement system; delays, for up to six years, more than $1.3 billion in transportation projects; and assumes a tripling of vehicle license fees, a $4.2 billion increase that will be immediately levied on all autos.
Regardless of who is governor following the recall; he or she will face a structural deficit that would qualify a Third World country for International Monetary Fund assistance. California can no longer postpone addressing this fiscal emergency