DAVIS, DEMOCRATS MUST REIN IN URGE TO SPLURGE.

Byline: KEITH RICHMAN 

ONCE you peel away all the political rhetoric, California's families understand how to manage the state budget. Spending must be balanced with income. You must consider short-term as well as long-term measures to ensure financial stability. When income is tight, spending levels must be reined in to match available resources.

These are the basic economic principles people should have learned in high school. Evidently, Gov. Gray Davis and most Democrat legislators were napping during those important lessons. Their current budget proposal ignores these common sense practices.

Despite the state's whopping $23.6 billion budget deficit, their budget spends $400 million more than last year and billions of dollars that simply are not available.

There is no mystery why we face this budget deficit. It is a spending problem. Davis can't control his spending urge and many Democrat legislators have encouraged his four-year spending jubilee.

In the rush to curry political favor with Sacramento interest groups, they have cast aside fiscal responsibility.

It is not as though Davis didn't have fair warning about the budget crisis.

Last year, the big spenders ignored responsible calls for fiscal discipline when they passed a budget that overspent revenue by $4 billion. Alas, if last year's budget had been in balance, there would be no need for tax increases this year.

Although an unsustainable spending spree caused the deficit, Davis and the Democrats' budget solution raises taxes on California families. Prudent Republican proposals to instead limit state spending have been dismissed out of hand.

Not only are Davis and the liberal Democrats spending beyond their means in the short term, their budget creates multibillion-dollar deficits for years to come.

In order to postpone the day of reckoning beyond the November election, their budget uses billions of dollars of loans and deferred payment schemes that have in recent months sunk major corporations.

According to recent projections by the respected, nonpartisan legislative analyst, California will have five straight years of multibillion-dollar budget shortfalls that add up to $51.6 billion. That deep barrel of red ink includes a $10 billion budget deficit in 2003-2004 and a $12 billion deficit the year after.

Make no mistake. There are no easy solutions to this budget problem.

Republicans stand ready to work with Davis and fiscally responsible Democrat leaders to pass a budget that recognizes economic realities.

Republicans have made their budget principles clear. California needs a balanced budget with no new taxes. California's working families should not have to tighten their own budgets because Davis and the Democrat majorities cannot control state spending.

Republicans care deeply about important state responsibilities such as education, public safety, health care and infrastructure, but recognize there is a limit to spending.

In addition, Republicans believe state government should be cost- effective, lean and accountable.

By leaving a prudent margin between spending and revenue, the state would be able to weather financial storms and maintain a responsible level of services.

We also want a budget solution that addresses the long-term structural deficit. We can't keep spending money we don't have and expect taxpayers to pay even more to cover the shortfall. We need to solve the spending problem now or face gaping billion-dollar budget holes in years to come.

This fundamental structural imbalance, where revenues and expenditures are not aligned, must be fixed. Revenues must balance with expenditures. Just as California families must live within their means, state government must adopt that well-proven, fiscally prudent principle.

It is time for responsible leaders to work in a bipartisan manner to resolve the state budget crisis. While capitulating to heavy-handed political dealing might save time and ease the governor's re-election concerns, passing a state budget that fails the most elementary economic tests would be a disaster for California's future.

Republicans look forward to working with courageous Democrats who share this point of view or at least remember what they should have learned in high school. With their encouragement, maybe Davis will set aside election-year politics and join in the bipartisan problem solving.