Joe Garofoli
Updated 10:39 pm, Saturday, January 26, 2013

With the state budget balanced for the first time in years, Gov. Jerry Brown is roaring that “California is back,” painting a rosier future for California with gauzy predictions of its “rendezvous with destiny.”

But beneath the governor’s flowery evocations of “bold pioneers” who followed “every failure with an even greater success,” Brown tacitly acknowledged during his State of the State speech last week that California’s present isn’t what it once was.

Before they rendezvous with destiny, Californians must confront their stark new reality.

“What everybody is struggling with now is how to set expectations,” said Mark Baldassare, president and CEO of the nonpartisan Public Policy Institute of California.

“The governor is trying to find a way to create expectations and keep a lid on them. And that’s tough to do,” Baldassare said. “Economically, we’re not at a point where we can take care of all of these needs.”

‘An era of limits’

The booming California of the 74-year-old Brown’s youth in San Francisco, or of his first stint as governor in the 1970s, doesn’t exist. Then, payrolls in the state were growing at roughly 4 percent a year. Now, more than 1 in every 5 California children lives in poverty. In Fresno County, 35 percent of kids are poor.

“That is the new reality. We are in an era of limits,” said Edward Leamer, a professor of management, economics and statistics at UCLA and director of the UCLA Anderson Forecast, an economic barometer that has studied the state’s payroll growth. “Jerry Brown is the first governor we’ve had who has to deal with the fact that over a whole decade there has been no growth.

“We cannot let loose another burst of spending the way we did in the Gray Davis era (1999-2003) because the revenue suddenly seems like it’s there. It isn’t there,” Leamer said. “The Gray Davis era had a kind of a false invocation of the California Dream because we had that Internet rush.”

California’s reality now includes 6 million residents who live in poverty, more than at any time in its history. While the state’s general fund may have stabilized, California must cover $27 billion in debt from past years and owes billions in pension obligations to state employees.

Nearly 10 percent of the state’s residents remain unemployed, the third-highest rate in the country.

Brown and the Legislature were able to balance the budget because voters passed $6 billion worth of tax increases in November. The poor have made the biggest sacrifices on the altar of the budget’s bottom line, as the state has cut $15 billion in health and welfare benefits to low-income Californians since 2009.

While Brown’s budget this year doesn’t include any additional cuts to health and welfare programs, the new reality means many poor Californians won’t be getting additional help soon.

“We’ve cut a lot of benefits in the past few years, and we know that, unfortunately, a lot of those benefits aren’t coming back,” said Michael Herald, legislative advocate for the Western Center on Law and Poverty in Sacramento, which advocates for low-income Californians.

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