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Cedillo Calls for Compromise on Budget, Sound Economics not Sound Bites

Press Release

By:
Date:
Location: Sacramento, CA


CEDILLO CALLS FOR COMPROMISE ON BUDGET, SOUND ECONOMICS NOT SOUND BITES

As the California State Senate closes out six consecutive days of meetings to line up budget votes, final passage of the budget remains one vote short. Members in both legislative houses and of both political parties including Sen. Gilbert Cedillo (D - Los Angeles) have put personal or political concerns aside to support the compromise package of bills however Senate Republicans worked to derail that progress pushing the state toward fiscal insolvency.

"Common sense has been replaced with empty rhetoric. The comments from some of our Republican colleagues seem more driven by politics than by economics. We need sound economic policy to prevail here, not sound bites," said Cedillo.

"This is a compromise budget; in fact it is a budget in which the majority party has yielded many painful concessions in order to make room for the three necessary Republican votes. To gain those three votes Democrats have agreed to regressive taxes, severe cuts to education, healthcare and transportation, and corporate tax breaks. For Republicans to say this is not enough is painful, blind to basic economic theory, and worst of all, keeps California hostage in a state of fiscal insolvency."

Several economists, including Nobel Prize winner Joseph Stiglitz and more recently 120 leading economists in a letter to New York's governor, have written on the impact of spending cuts versus tax increases during difficult economic times. Most theorists point to a balance of each as the best approach however common consensus is also that spending cuts during a recession are more harmful to the economy than highly targeted tax increases.

Cuts in government spending have a triple negative effect - they tend to immediately negatively impact local businesses, result in higher number of workers unemployed and uninsured, and put off education and healthcare expenditures which improve future economic conditions.

"For Republicans to say they want to layoff state workers, they want MORE unemployed Californians is ridiculous. This will drive up unemployment claims, the number of uninsured, the burden on emergency rooms - it takes money out of the economy. I challenge the Republicans to disprove the brightest economic theorists in our nation and come up with a plan to balance the budget on $41 billion in cuts alone. Aside from the absolute absurdity of such a notion, I doubt their constituents or any of the residents of California will stand for that," added Cedillo.

"We can and we must take a stand however, that this is the best hope of compromise we have right now. We must act to stop the IOUs, to restart construction projects, and to halt the layoffs of any additional workers."

"Lead, follow, or get out of the way. Follow the voice of Californians; they have demonstrated time and again with votes to invest in education, to invest in transportation. We need one vote. They want action and if we do not take it, they will."


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