Oops, California overspent by almost $4 billion
Friday, July 11th, 2008Almost five years ago on July 29, 2003 the Legislature passed a $70.8 billion General Fund budget. A few months later, Gov. Gray Davis was recalled.
Today, we find out that California overspent its 2007-08 budget by $3.9 billion for a total of $107.3 billion, a 51.6 percent increase in government spending over the approved budget five years ago.
So, how did we spend almost $4 billion more than budgeted last year? If the past is any guide, most of the overspending will be in two categories: entitlement spending and the prisons system.
Entitlement spending usually constitutes the bulk of the overspending because, based on income and other factors, some people are “entitled” to tax-funded government health or welfare services. Since they are “entitled,” they must be served, regardless of what was budgeted. Government simply gives benefits to all who apply and adds the bills up afterward; then we all pay. Since California has among the most generous health and welfare eligibility thresholds in the nation, a lot of people qualify for benefits.
If California is to have any chance at getting its budget under control, it must reform its health and welfare system starting with eligibility criteria.