California's Budget Situation

Context and Precedence:

On March 2, 2004, Californians passed Proposition 58, The CALIFORNIA BALANCED BUDGET ACT. It was an amendment to the California Constitution that required that the state budget be balanced. It prohibits the government from issuing deficit bonds. The governor is allowed to proclaim a fiscal emergency and submit legislation to address the emergency. If the legislature fails to act within 45 days, they are not able to recess or to pass any other legislation until the budget issue is solved.

The act passed by 71.1%

The situation today as outlined in the blog entry below details how California is issuing IOU's to pay it's bills.

It's funny that the legislature is proposing a lot of taxes to address the problem.

The solution is not to tax the public more, but to reduce spending. David Wolf said, "You still have more revenue coming in than any other state in the union. You just can't justify continuing to raise taxes."