Skip To Content
Back to Opinion

The Wrecking Crew

As the signed petitions pile up, Californians look ever more likely to head for the polls this fall to recall their hapless governor, Gray Davis. His crime? Opponents call it fiscal mismanagement. But his real crime might best be called DWD, or Driving While Democratic. His foes are simply out for blood.

Davis is being made to take the fall for California’s yawning $38.2 billion budget deficit. The gap has lowered the credit rating of the nation’s richest state to near junk-bond status. It’s threatening havoc in the state’s education, transportation and, as Josh Richman reports on Page 1, its most essential social services.

Californians are right to be angry, but they’re blaming the wrong guy. If they really want to punish the culprits responsible for their state’s sorry finances, they should be looking at George W. Bush and his Republican wrecking crew down in Washington, D.C.

The fiscal crisis battering California is national, not local. It’s a fish that stinks from the head. Nothing could have made that clearer than the breathtaking $455 billion federal budget deficit projection announced by the White House this week.

The figure beggars the previous record set in 1992 — by the last President Bush. As a share of the nation’s total economic output, 4.2% of GDP, it’s the highest since the record set in 1983 by Bush’s ideological mentor, Ronald Reagan. Leaving aside the surplus in the theoretically-separate Social Security trust fund (yes, Virginia, Social Security is in surplus, not free-fall) the deficit actually comes to 5.7% of GDP, a post-World War II record. It’s more than double the deficit limit imposed by the European Union on those supposedly profligate socialists of Old Europe. If America were a Third World country forced to get budget approval from the World Bank, we’d be in receivership.

But of course, the World Bank doesn’t tell Washington what to do. Just the reverse: Washington does what it wants, hands out goodies to those it favors and sticks others with the tab.

And so taxes are cut for the wealthy, then cut again. Corporations get billions in handouts. Budgets are slashed for just about every federal program except national security. The economy goes down, unemployment hits record highs, the federal budget collapses, but Republicans just keep dancing.

No, it’s not all Bush’s fault. He inherited the tech bust that started the economic slide. The September 11 attacks compounded it. Bush didn’t create the crisis. But he hasn’t fixed it, either. He’s made it worse.

The crisis puts states in an impossible squeeze. As suffering spreads and federal programs are cut, states are forced to step in with billions of dollars in urgent social services. But state revenues are shrinking just like Washington’s — and unlike Washington, most states must balance their budgets. It’s a recipe for disaster.

California isn’t the only state to face fiscal crisis this year. Nearly all of them have. New York closed its $11.5 billion budget gap through a variety of gimmicks, service cuts and a $2 billion tax increase passed over the governor’s veto. Illinois closed a $5 billion gap by borrowing against the state’s already-underfunded pension fund. Connecticut’s governor had to send state troopers to round up unruly legislators to pass a critical $1.2 billion tax hike. Even tax-shy Alabama is considering a hike. Some New York state school districts are facing property-tax increases as high as 47%. For many working Americans, the net effect of Bush’s fiscal management is poorer schools, dirtier streets, more crowded hospitals — and a higher net tax bill.

If California’s troubles are more dramatic, that’s partly because everything there is bigger. It’s also because of the state’s reckless tradition of democracy-by-referendum. In this case, the prospect of booting the Democratic governor has removed the incentive for Republicans in Sacramento to settle on a budget deal. And so, unlike the other states, California twists in the fiscal wind.

I hope you appreciated this article. Before you go, I’d like to ask you to please support the Forward’s award-winning, nonprofit journalism during this critical time.

Now more than ever, American Jews need independent news they can trust, with reporting driven by truth, not ideology. We serve you, not any ideological agenda.

At a time when other newsrooms are closing or cutting back, the Forward has removed its paywall and invested additional resources to report on the ground from Israel and around the U.S. on the impact of the war, rising antisemitism and the protests on college campuses.

Readers like you make it all possible. Support our work by becoming a Forward Member and connect with our journalism and your community.

Make a gift of any size and become a Forward member today. You’ll support our mission to tell the American Jewish story fully and fairly. 

— Rachel Fishman Feddersen, Publisher and CEO

Join our mission to tell the Jewish story fully and fairly.

Republish This Story

Please read before republishing

We’re happy to make this story available to republish for free, unless it originated with JTA, Haaretz or another publication (as indicated on the article) and as long as you follow our guidelines. You must credit the Forward, retain our pixel and preserve our canonical link in Google search.  See our full guidelines for more information, and this guide for detail about canonical URLs.

To republish, copy the HTML by clicking on the yellow button to the right; it includes our tracking pixel, all paragraph styles and hyperlinks, the author byline and credit to the Forward. It does not include images; to avoid copyright violations, you must add them manually, following our guidelines. Please email us at [email protected], subject line “republish,” with any questions or to let us know what stories you’re picking up.

We don't support Internet Explorer

Please use Chrome, Safari, Firefox, or Edge to view this site.