Friday, July 10, 2009

Hey California, How's That Budget Coming?

I'll be the first to admit that I don't fully understand the intricacies of government spending. But that's alright, because clearly our own government doesn't, either.

I live in California, where Governor Arnold Schwarzenegger has declared a state of fiscal emergency. What does that mean? It means that the state is in dire financial straits, and our elected leaders have demonstrated nothing but an embarrassing inability to approve a budget that even hints at helping California emerge from its current financial doldrums.

How bad are things? California is operating under a deficit of more than $25.0 billion, a figure that is almost a quarter of the state's total operating funds. In simple terms, that means that the state of California has spent $125 for every $100 it has allocated for spending. When you're talking about a budget in the billions, that's a lot of dollars. And according to the BBC, that deficit could increase to over $30.0 billion by September.

What does this mean to you and I?

A friend of mine just got her tax refund in the mail - Instead of a check, she received an IOU.

That's right, that state of California issued her an IOU for the refund she was owed for money she had already paid in withholding.

How does that work? Theoretically, the IOU she received can be deposited in the bank, but the funds won't be paid by the state treasury until the state budget is approved. In other words, that IOU is worth less than that "I'll get you next time" that your friend promised when you picked up the tab at the bar the other night.

At least you can count on your friends.

Political rhetoric aside - because we all know that the other side is always to blame - this issue boils down to a simple fact: The people that we elect to do a job, are not doing their job. Period. End of story.

In the real world - meaning, everywhere but government - operations grind to a halt without an approved budget. And people lose their jobs when those budgets aren't established and adhered to.

When I worked as a department head at one of America's leading internet companies a few short years ago, I was told that my employee reviews couldn't be processed until a new budget was in place. A month after my proposed raises were submitted (and approved), my entire department was laid off - despite the fact that we were one of the most productive teams at the company. It was no doubt a hard choice by the higher-ups, and it had bitter ramifications, but even I can admit that it was a necessary choice given the site's fiscal concerns.

Hard times call for hard decisions, and nowhere is that more evident than in today's trying economic times.

But in the state of California, nobody seems willing to take responsibility for the necessary compromises and hard choices when it comes to our budget. Why? Because the decisions won't be popular, and nobody wants to look like they are rescinding promises that they made to attain their elected positions.

Unfortunately, it's too late to worry about public perception. It's time to get the job done, regardless of how it may be perceived by the media, and regardless of how it might effect one's chance at reelection.

Politicians aren't elected to their offices with the expectation that they'll be reelected, they are elected with the expectation that they will serve their term with the best interests of their constituents in mind... Reelection is their reward for a job well done.

Somebody needs to remind our politicians that their reelection is in the hands of cash-strapped Californians who are receiving IOUs instead of tax returns.

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