The Swarm

Mix it up with The Bee's editorial board.

May 22, 2009
On budget borrowing

I want to challenge a bit of conventional wisdom about the state's once and future habit of "borrowing" from local government or from special funds, such as those set aside for transportation.

I don't think we should call this kind of policy choice borrowing, or even think of it that way.

The state and all of its cities and counties are governed, utlimately, by the same people: us. I live in the city of Sacramento. I also live in the county, and in the state of California. I pay taxes that are collected and then disbursed to each of these entities.

If the state "borrows" $10 million from the city of Sacramento for three years, what is really happening is that state legislators are making a policy choice. They are saying, in this time of crisis, that the tax money that used to be going to the city would be better spent going for health care or prisons or education. The city council might not like this. I might not like it. But it is not as if the state is some alien creature or foreign government. It is us. And the money is ours.

In the case of the transportation fund, the misapplication of the concept of borrowing is even clearer. The transportation budget is part of state government. So in that case, the Legislature is simply saying that, in this time of crisis, they think one part of state government is more important than the other. Yes, the voters passed a measure walling off a piece of the tax collections for transportation. Then they passed another saying the Legislature could shift that money in a crisis but would have to "pay it back" within three years. So if the Legislature does this, it is really saying we think education, or whatever, is more important today than building more roads, but we think (or  hope) that in three years we'll have enough money to pay for schools and more roads, including the roads we didn't build this year.

Think of your own family. Suppose you set up a college fund for junior and started contributing 5 percent of your salary to it every year, with every intention of doing so for 18 years. Then, after 5 years, your salary was cut 10 percent. You no longer have enough money to pay your mortgage, buy your food and set money aside for college. Do you starve, move, or stop paying into the college fund? And if you stop paying into the college fund, are you being irresponsible, and are you "borrowing" from your children. I think not, on both counts.

We are so used to binding the Legislature up in fiscal knots that we have forgotten what the Legislature is actually trying to do: govern the state, set priorities, manage our tax dollars. I've been as critical of them as anyone, but maybe we ought to give them the tools to actually do their jobs before we start screaming about what a lousy job they do.












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About The Swarm

The Swarm is written by members of The Sacramento Bee's editorial board. They meet daily and are separate from the newsroom. Views included here are those of individual writers, and do not necessarily reflect those of a majority of the board or the positions expressed in The Bee's editorials.

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