Calif. candidates are offering scant details of budget plans

In the opening days of California's gubernatorial recall campaign, some leading candidates have offered barely a hint of how they would cope with the main issue that has fueled the drive to oust Gov. Gray Davis: the state's fiscal crisis.

Davis and the Legislature relied heavily on borrowing to close a monster $38 billion budget gap this year. As a result, the governor - Davis or a successor - must confront a new shortfall of $8 billion or more within months.


Even the few broad outlines sketched by some recall candidates fail to account for that gap. The one point of agreement among nearly all major candidates is a plan to repeal the recent tripling of the state car tax, a move that would deepen California's budget hole by an additional $4.2 billion a year.

Although the budget mess is certain to dominate the governor's job for years, political strategists say it is no surprise that candidates have mostly sought to avoid specifics on how they would clean it up.


"Any realistic discussion of it is really offering a choice between a punch in the nose and a knee to the groin, and no one wants to inflict pain on the voters when they're soliciting their votes," said David Axelrod, a Democratic campaign ad maker.

For three years, state lawmakers have put off many of the hard choices involving higher taxes or sharp program cuts, choosing instead to borrow billions of dollars to finance the government. The growing debt will aggravate the state's fiscal troubles for years.

In response to a Los Angeles Times questionnaire asking how they would confront the budget, Davis and six of the seven leading contenders to replace him laid out some of their positions Friday. Only Arnold Schwarzenegger declined to respond.

Republicans Tom McClintock and Bill Simon Jr. - competing for the votes of conservatives - have been the only candidates to focus relentlessly on the fiscal crisis as they campaign.

They promise to cut billions in spending, although budget experts are skeptical of their projected savings from wiping out what they call waste, fraud and abuse. Further, they have not explained how they would push their proposals past the Democratic majority in the Legislature that refused to go along with cuts proposed by its own party's governor.

The leading Democrat in the race, Lt. Gov. Cruz Bustamante, plans to release his agenda for fiscal recovery tomorrow. It will call for $7.2 billion in tax increases, mainly on alcohol and tobacco, and more frequent reassessments of commercial property. He also will propose $4.5 billion in largely unspecified spending cuts and savings, including $500 million from fighting fraud in Medi-Cal, the state health program.

Bustamante is the only major candidate who would not reverse the entire increase in the car tax. He argues that it imposes an unfair burden on low-income Californians, so he would rescind the increase only for the first $20,000 of a vehicle's value. The proposal could appeal to many Democrats, though it might anger Republicans who oppose the tax.

On budget matters - as on other issues affecting the state - the vaguest candidate is Schwarzenegger. When he announced his candidacy for governor, he promised to abolish the car-tax increase "the second I walk in the office." He later called for building more schools and hiring more teachers.


But apart from his vow to create jobs - "We have to make sure everyone in California has a fantastic job," he said - Schwarzenegger has not explained where the state would find the money to pay for his proposals. In the absence of other plans to cut costs or raise revenue, they would increase the budget gap to more than $12 billion a year.

Republican candidate Peter Ueberroth, who is running as an independent, plans to unveil his economic plan this week.

In an interview, Ueberroth called for new "revenue building" but declined to be specific. In response to the questionnaire, he sidestepped the question of whether he would approve tax increases, saying tax rates would be lower by 2007 - when the governor's term is due to end - than they were when Davis took office in 1999.

Arianna Huffington, a former Republican running as an independent, promised to close corporate tax loopholes, raise property taxes on businesses, freeze spending, fight reductions to schools and health care, and slash the state's "bloated" prison budget.

Green Party candidate Peter Camejo promised a 1 percent income-tax increase for the richest third of Californians and cuts in prison spending. He vowed to spare health care programs and avert layoffs or pay cuts for state workers.

For his part, Davis said he supports repeal of the car-tax increase, which was not part of the budget he proposed in January - though he has allowed it to take effect over Republican objections. To make up for the lost $4.2 billion, he would raise taxes on cigarettes and the income of the richest Californians.


The Los Angeles Times is a Tribune Publishing newspaper.