The numbers are staggering -- and all too familiar. Next year, California faces a budget deficit of $10 billion and rising. State agencies are preparing for an expected 10% across-the-board cut. The 2008 budget fight could make this year’s 51-day summer standoff look like a minor quarrel.
With all the projected red ink, The Times and other newspapers are starting to pay attention to the budget mess. Unfortunately, this newspaper has recently gone out of its way to suggest that the budget crisis is primarily traceable to spending. The role that tax policy plays in the persistent revenue shortfalls receives much less attention.
Here’s the problem. The politics of the budget crisis are in large part shaped by media coverage. When the state’s largest and most influential paper focuses on spending -- while largely ignoring the revenue side -- in budget articles, it implies that the solution to the budget crisis is slashing spending rather than raising taxes. That’s not balanced journalism.
Consider Evan Halper’s Nov. 24 “news analysis” under the headline, “In this budget bind, gov. finds hands are tied.” The article contended that the emerging budget crisis has two primary causes. The first involved deals, made by Gov. Arnold Schwarzenegger to do away with a previous $14-billion deficit, that take previously tapped pockets of money off the table. For instance, he pledged never again to borrow from local governments to balance a budget, as he did in 2004. The second cause cited in the article was “voter-imposed budget constraints” that mandate spending, such as Proposition 98, which guarantees that 45% of the general fund goes to K-12 education.
Nowhere in the article is there a mention of a possible tax cause of the budget shortfall, such as Schwarzenegger’s rollback in 2003 of a vehicle-license fee increase put in place by former Gov. Gray Davis. That act has cost the state $5 billion and counting. Senate President Pro Tem Don Perata (D-Oakland) called it “the dumbest damn thing” he had ever supported in government. By leaving out the option of raising taxes or fees to help resolve the budget crisis, the article leaves readers believing that only spending cuts will do the job.
The Times’ apparent aversion to raising taxes crept into a Nov. 28 article by Michael Rothfeld, headlined “Gov. pushes private works.” In describing the governor’s call to privatize some state construction projects, the article quoted Schwarzenegger as saying that “there’s not enough money there in the public sector, in the tax base,” to pay for new or upgraded public works.
Although the article included critics of the privatization concept, it did not question Schwarzenegger’s implicit rationale for it -- the governor won’t push for a tax increase. Nor did it point out that California’s infrastructure backlog -- including schools, waterworks, freeways and transportation -- is largely the product of 30 years of cutting taxes instead of attending to the basic needs of a growing economy and population.
To its credit, The Times, in a Nov. 9 editorial titled “Red-ink realism,” correctly noted that Schwarzenegger is partly to blame for the budget mess by lowering the vehicle-license fee. But rather than call for tax increases -- or even just a study of possible new sources of revenue -- to pay for locked-in or new spending, the editorial offered up the bromide that California needs bold, courageous leadership to solve the budget problem.
California has a well-deserved reputation for being the home of the tax revolt, but as polls have shown, this is often overstated or not qualified. For instance, an October Times/Bloomberg poll found that 60% of respondents said they were willing to pay higher taxes if the money were used to finance universal healthcare. The existence of voter-mandated spending also suggests a widespread public desire for budget solutions that do not merely slash and burn spending for public services.
For better or worse, California politicians determine their budget solutions by how their actions will be received in the next day’s papers. Readers look to The Times to help keep them informed about the state’s finances. Given that journalistic responsibility, The Times owes its readers a more balanced view of the causes and possible solutions to the budget crisis.