GOLIS: Democrats get a New Year's wish

For years, Democrats have longed for the authority to pass a state budget with simple majorities in both houses of the state Legislature.

Well, congratulations, Democrats. Your time has come.

By the way, the budget deficit over the next 18 months just grew to $28.1 billion.

And you have until June 15 to tell us how you're going to fix it.

Even for people who keep track of Sacramento's addiction to debt, the latest news on the state's financial predicament is grim.

The deficit keeps growing. The state's total debt has increased from $34 billion to $91 billion in seven years. The annual cost of debt service has increased from 3? percent to 6? percent of the general fund. With the lowest credit rating among the 50 states, California pays more than a percent more in interest rates than comparable states. Annual deficits ranging from $19 billion to $22 billion are forecast for the next five years.

And the state still doesn't know how it will manage unfunded liabilities associated with pensions, unemployment insurance and federal health care reform.

If you're not depressed about all this, you're not paying attention.

Legislative Analyst Mac Taylor told a Sacramento gathering of state and local officials Wednesday that deficit spending began before the recession, leaving state government without a cushion to dampen the shock of falling revenues.

"We went into the recession in very poor fiscal shape," he said.

This is what happens when any institution lets spending exceed revenues year in and year out, while covering the difference with debt and one-time revenue gimmicks. Eventually, it all comes crashing down.

Gov.-elect Jerry Brown, who convened last week's town hall meeting, summarized: "What we're looking at today is worse than it's ever been before."

It's easy - and appropriate - to blame politicians and partisanship for this unhappy legacy, but voters like you and me are not innocent bystanders. We have passed ballot measures that demand more services and lower taxes, while pretending that we can have it both ways.

Legislative Democrats have said they could put California back on track if they could pass the state budget with simple majorities in the Assembly and Senate.

As they say: Be careful what you wish for.

In November, voters approved Proposition 25. Now the Democratic majorities in each house have the power to produce a balanced budget - if they can.

The Los Angeles Times reported on Thursday that Brown is hinting in private meetings that he may seek a special election in June, asking voters to approve a tax increase to cover a portion of the shortfall.

In the most difficult economic conditions in 70 years, a tax increase would be a hard sell.

But the outcome, yea or nay, would allow the governor and the Legislature to understand the magnitude of spending cuts necessary to shrink the deficit.

In what it called "the case for optimism," the Economist magazine noted last week that two other changes may expedite the state's recovery. The combined effect of redistricting reform and open primaries is expected to lead to the election of legislators more willing to seek compromise.

Consider the prospects for new Democratic Assemblyman Michael Allen of Santa Rosa.

Anointed by the coalition of public employees unions and environmentalists that serve as the Democratic base in the North Bay, Allen won last June's Democratic Primary by 1,636 votes, less than 4 percent of the votes cast.

Then, in a district in which Democrats outnumber Republicans by more than two-to-one, he was easily elected in November.

But open primaries change the calculus. Beginning in 2012, the two top vote getters, regardless of party, will run-off in the November election.

This creates the possibility that the November election could involve two Democrats.

What would happen if Allen found himself facing off against a centrist Democrat who might draw votes from moderate Democrats and Republicans? The answer may depend on whether centrist Democrats organize behind a second Democratic candidate.

Two years from now, this will be the storyline that dominates many legislative elections.

What seems clear is that incumbents - Democrat and Republican - will have to pay more attention to voters beyond their base of support. They will also have to explain the painful spending cuts that will continue to erode government services.

"In the course of 2010," the Economist reported, "(California voters) have passed reforms that could make the system work again. It will, however, take time."

In the short term, it's going to be ugly.

Already, there are signs that state lawmakers want to do what they usually do when times are tough: Become born-again champions for local control and dump the costs and responsibilities on to cities and counties.

Some Democratic lawmakers also are complaining about the cruel impacts on schools and the less fortunate.

You may ask them: Where were you when the state was letting spending exceed revenue? Did you really think that there wouldn't be consequences to living on a credit card?

Beginning now, one party is responsible for making it right.

Happy New Year, legislative Democrats.

And welcome to your year of living dangerously.

Pete Golis is a columnist for The Press Democrat. E-mail him at golispd@gmail.com.