Cutting a budget deal for the world's eighth largest economy

Bleary-eyed, State leaders announced a solution to the budget deadlock that has forced California to issue IOUs to pay bills. But the more the details emerge, the less it looks like a "solution" and the more it looks like a "deal" that breaks every promise the Governor has made, starting with his pledge not to kick the can down the road.

Cities have joined in the howling. The State will "borrow" $2.73 million in local property tax from Ventura and simply refuse to pay us $1.73 million in locally collected Gas Tax funds for each of the next two years. The State will also divert several hundred thousand in local redevelopment property tax revenues, but the exact formula hasn't been revealed yet. The upshot statewide is that Redevelopment agencies will be crippled, street repair will suffer and cities will either have to make deeper cuts in local services or borrow from reserves until the State has money to pay them back. If these sacrifices helped fix the State's chronic fiscal problems, it might be worth the short-term pain.

Everyone recognizes the budget hole has grown too large for a popular solution. But what's sickening about this budget "deal" is that despite the pain inflicted on millions of California residents, the agreement actually makes the State's fiscal problems worse and guarantees higher costs -- and bigger problems -- down the road.

State leaders blame the long stalemate on the two-thirds majority requirement to pass the budget. But Ventura has both Democrats and Republicans on our City Council and they voted unanimously for $11 million in cuts to balance this year's budget. State leaders ignored Constitutional deadlines before cutting a secret deal, but here in Ventura, the City Council worked in public to finalize our budget plan back in March, well ahead of legal deadlines. It isn't that the City Council in Ventura is so heroic -- the contrast just underscores how irresponsible the leaders in Sacramento have been.

Short of another recall circus like the one spawned by the State's last budget meltdown, the current leadership will remain in place for the next year and a half. Unfortunately, the house of cards they've erected with this budget deal will collapse sooner than that. Stupid gimmicks like postponing payroll into the next fiscal year guarantee more pain, more partisan wrangling, more budget crises and more counter-productive schemes. It's a sad prospect for the Golden State.