50/50 BUDGET CONCEPT WILL NO LONGER COMPUTE.

Byline: Bruce L. Bialosky Local View

THE sides are squaring off on the California budget debacle. Arguments are being made and mantras are being developed. New rationales are being tossed at the public and old ones dug up. Unfortunately, the truth is getting blurred in the process.

Let's start with a central core fact. Very few people actually want to pay for the amount of government they would like. Most people would love to have all those nice governmental agencies around but, faced with the reality of a shrunken paycheck to cover the cost, they would opt for essential services with a few frills.

With this in mind, we are faced with a huge deficit in our state government here in California. Let us again review indisputable facts. Over the past three years our state budget rose 37 percent when inflation was 2 percent to 3 percent per year. If you add a factor for increased population, the budget maybe should have increased 15 percent. The state government added 40,000 new employees. These are not educators to which a large part of our budget is dedicated. These are state bureaucratic workers.

Most important, Gov. Gray Davis' own people told him the tax-collections funding for these bloated operations were temporary and that permanent programs should not be established.

Now our elected leaders start lining up to create their rationales for their positions. Herb Wesson, speaker of the Assembly, says if we fired every employee, we would still not balance the state budget. Davis has offered budget cuts equal to one-half of the budget deficit. The implication is the other half will come from ``revenue enhancements.'' Pete Wilson's 1991 50 percent tax increase/50 percent expenditure reduction deal is being praised as a model of great leadership. Alcohol is now being blamed for every societal ill (some justifiably) as a reason to jack up taxes on martini drinkers.

I am not here to defend those who choose to imbibe and certainly not those who overdo it. But most of these arguments are flatulence. Drinkers are not the problem. Too much government is the problem.

Let us do some simple math - no fuzzy math here, just plain numbers. Our budget started at about $70 billion before this all started. If you add onto that the 15 percent increase that would have been justified for population increases and inflation, you would have a budget of about $80.5 billion. We have one that reaches toward $100 billion. The difference of $19.5 billion is a large portion of our estimated budget deficit of $34.8 billion. Certainly, if the growth in our state budget were restricted to the growth in population and inflation - restrictions in place in other states - we would not be facing this colossal mess we have now.

But elected officials don't like to antagonize their constituencies (people who give them campaign funds). In this case, Democrats control the state government, and state employees are big financial supporters of their campaigns. Sort of biting the hand that feeds them.

So knowing that they need some Republican votes, they are pitching this 50/50 deal. Democrats say that their contributors will suffer for half the amount to bring this thing into balance; the rest of you 32 million people will cover the other $17 billion-plus.

Here is the flaw in their thinking. The explosion in state governmental costs was covered by a steep increase in tax collections due to extremely strong economic factors and the dot-com boom. Those revenues have disappeared as times have gotten tougher for many reasons. Unemployment is up and businesses and their employees are not doing so well.

Those government wonks will pitch us they are taking from the rich and giving to the poor, but that is not the true case. Most of that money will be taken from either essential or discretionary family expenditures. Retailers will be hurt, hotels will be hurt, and we all will suffer for it. Employees will be let go. Make no mistake about it. The $17 billion will flow out of our hands into amorphous governmental departments.

Our elected officials have an obligation to go back to the table and make legitimate cuts. Everything needs to be up for analysis. To use some old terminology - zero-based budgeting.

Before you take necessary family funds from the residents of this state, you better make darn sure it is absolutely necessary. As of now, our elected leaders have not gone down that road. They have to start that trek.