Chiang: California budget crisis

Controller John Chiang Calls For Immediate Action to Avoid Economic Catastrophe
Statement by Controller John Chiang at the Senate and Assembly Joint Convention
December 8, 2008

Mr. Pro Tem, Madame Speaker, and distinguished members of the Legislature, let me first commend you for convening this joint session to address the dire financial circumstance that threatens the current and future solvency of our state.

Make no mistake, a delay in action would be catastrophic. As unpalatable as tax increases or further program cuts may appear, neither is as toxic to the State’s fiscal health as doing nothing.

Failure to act threatens our ability to respond to natural disasters, our ability to provide life preserving care to the elderly and the ill, and our ability to protect our communities from crime.

If we are to avert sure disaster, together we must set aside blame, proceed with speed, pursue practical solutions, and, most importantly, summon the political courage to make the decisions necessary to protect the programs and services that Californians depend on every day.

Before I speak to the State’s cash flow problem, and why attacking the $28 billion deficit is needed to stave off an immediate shut down of public services, let me begin with a critical distinction between “budgeting” and “cash available.”

As you know, the “budget” refers to the financial plan based on estimated revenues and disbursements for a fiscal year. This plan and its projections are a primary responsibility of the Department of Finance.
Read the entire presentation at www.Californiaprogressreport.com