California Budget Dreaming, or Scheming

              The fact that the California state government is a little short financially this year is becoming a national crisis, if not a world wide one.  At least some of them are hoping for an injection of federal stimulus loot to get by.  But they operate on a large scale out there so they are looking at a really super sized deficit. I don’t think we are going to be able to help them. When the biggest and richest state in the country spends itself into trouble, it’s going to be hard to find anybody who could really take on the problem.

        Georgia recently passed a budget for the fiscal year starting July 1^st of $18.6 billion.  We are now expected to have a population of about 10 million next year in the census.  California has about 37 million people.  So if we were to expand our budget to a population of that size, what would we get?  We only need to multiply by 3.7 to get the answer of just over $69 billion.  So what is the problem out there?  Their DEFICIT is projected to be $24 billion.  In an earlier version of the budget, they were looking at a $41 billion shortfall. But even in that projection, they had almost $73 billion available to spend.  But they were planning to spend about $111 billion.  Apparently they have cut back some but not enough.

        If California spent the same amount percapita as we do here in Georgia, they would have a surplus instead of a projected deficit.  Not only are they a lot bigger and richer than we are, they probably think they are smarter too.  But there is probably something we could teach them about getting by on what you have instead obligating yourself to pay for everything you want and wondering later about how to pay for it.

An important lesson here is that if the biggest and richest state, bigger and richer than many countries, can spend itself into the poor house, so could the richest country with the biggest economy (Ours!) While there is a crisis, it is hard to jump up in front of the wave of stimulus spending programs since so many people are demanding action.  But we need to be looking for ways to slow federal spending as soon as possible.  Even the richest state or nation can spend itself broke.