Wednesday, January 16, 2008

Borrow and Borrow, Cut and Cut

The cuts in Schwarzenegger's budget are big, but they're not the whole story; the rest is borrowing:

Despite deep cuts in Gov. Arnold Schwarzenegger's proposal to bridge the state's $14.5 billion deficit, nearly half of his budget-balancing plan involves borrowing money, deferring debt payments and counting future tax revenue, according to a report released Monday by the nonpartisan legislative analyst's office....

Legislative Analyst Elizabeth Hill questioned the shifting of revenues from one fiscal year to another.

"In our initial review, we have not yet been able to determine whether this proposal is a reasonable change in accounting practices or merely a convenient way to generate a one-time revenue bump," she wrote in her 23-page report released Monday.
Let's be clear about this: when Schwarzenegger says he isn't raising taxes, he's lying. He's incurring expenses that will have to be repaid eventually; instead of raising rich people's taxes now, he's raising somebody's taxes later.

This dishonesty is at the core of anti-tax fundamentalism. They pretend that there is such a thing as a 'tax cut'--free money for 'taxpayers' (in practice, for the favored few)--when it's really just tax shifting (from rich people now, to less well-off people later). Schwarzenegger almost certainly knows better, but he has to pander to the Norquist wing.