Transcript: CA Gov. Jerry Brown on the May revised state budget for 2012-2013

Transcript of remarks by Gov. Jerry Brown (D-Calif.) on the revised 2012-2013 state budget released on May 14, 2012:  

“Good morning. Today, I’m releasing the May revision to the budget this year.

“It’s a difficult budget and it reflects the fact that revenues are lowered than we expected. Certain cuts weren’t made in January as we’d hoped and federal judges have blocked certain reductions – hundreds of millions of dollars worth. And also, we’ve been unable to obtain certain waivers from the administration in Washington that would have prevented further cuts.

“Because of all that, we have a more difficult problem – we’re going to have to cut deeper.

“But cutting alone really doesn’t do it, and that’s why I’m linking the serious budget reductions – real increased austerity – with a plea to the voters: Please increase taxes temporarily on the most affluent and everyone else with a quarter of a cent sales tax.

“I think it’s reasonable. I think it’s fair, and it will also provide a reliable source of funding for local law enforcement.

“We have some charts here that I think are fairly instructive.


“The first one I want to point out is right over here. If you notice the red – the $17.2 [billion] – would have been the structural deficit. By structural deficit I mean if you just look at a budget year, how much is the difference between the revenue coming in and the spending going out? That would have been $17.2 [billion] but because of the tough cuts that have been made by the legislature, it was only $4.4 [billion]. This upcoming year it’s $8.1 [billion]; it would have been $19 [billion]. And going out, you see, it would have been as high as $21 [billion] but it will now only be $7 [billion].

“Now, with my plan, we erase that yellow line and we get to what we hope will be a balance.

“And we do that – if you look at the other chart and I think it’s pretty reasonable. It cuts 50%, the taxes almost 35%, and other kinds of borrowings and deferrals 15%, and add that of course to the taxes from last year.


“Now, I do have a surprise chart that I’m going to bring out for you, and that is here’s what happens to schools. $47 billion this year going to $64 billion over those next several years. And that’s both the tax and also the growth in state revenues from the predicted recovery of the economy.

“Now, I know you’d say, ‘Why didn’t we get it right in January?’ Well, you never can quite get it right because in our particular free enterprise system of free flow of capital, stuff moves. It goes up and down. And if you look back, probably the only time of real stability was during the governorship of Earl Warren when we had massive federal government spending and wage and price controls, and that built up a big rainy day fund; Goodwin Knight spent that down. And then all of the other governors have had to deal with shortfalls of one kind or another, and here we are today.

“But I’ve laid out a plan. We’re going to stick to it. We’ll get as close as we can. Nothing will ever quite be the same on June as it is in May, much less in January.

“But I said at the beginning when I ran for this job that it’s taken a long time – more than a decade – to get into this mess. We’re not going to get out of it in a year or even 2 years but we’re getting there. We’re making real progress.

“So I would urge a modicum of stoicism and less of indulging your propensity to immediate gratification. It’s coming. It’s getting done. And I think you can be confident that before I leave here, we will be in solid fiscal balance and we can look forward to a very stable future.”


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