New York Times columnist Paul Krugman, who recently won the Nobel Prize for Economics, has a column today about how the states are handling their budget troubles. He had this to say about California:
His column also fails to acknowledge that states, unlike the federal government, can't engage in deficit spending. They have to balance their budgets each year, at least on paper.
Krugman, I suspect, enjoys tangling with Schwarzenegger. He dinged him in this blog entry in November, was ambivalent about his health care reform proposal in 2007 and, of course, called him "Conan the Deceiver" in this piece from 2003.
Are governors responsible for their own predicament? To some extent. Arnold Schwarzenegger, in particular, deserves some jeers. He became governor in the first place because voters were outraged over his predecessor's budget problems, but he did nothing to secure the state's fiscal future -- and he now faces a projected budget deficit bigger than the one that did in Gray Davis.Krugman's column, although true enough, is lacking in crucial context. Because California's Legislature is controlled by Democrats, it was impossible for Schwarzenegger to cut spending upon taking office. And with the two-thirds vote requirement, it's been tough for him to get Republican support to raise taxes and cover the current $11.2 billion shortfall.
His column also fails to acknowledge that states, unlike the federal government, can't engage in deficit spending. They have to balance their budgets each year, at least on paper.
Krugman, I suspect, enjoys tangling with Schwarzenegger. He dinged him in this blog entry in November, was ambivalent about his health care reform proposal in 2007 and, of course, called him "Conan the Deceiver" in this piece from 2003.
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