Cal. Budget deal puts state in hole for next year

The San Francisco Chronicle reports:

California may be about to crawl out of a fiscal crevasse now that the Legislature has adopted a $23 billion deficit-reduction plan, but the state is headed toward another deep hole even if the economy recovers, finance experts say.

The budget deal Gov. Arnold Schwarzenegger plans to sign Tuesday relies on roughly $8 billion in accounting maneuvers and questionable new revenue that experts say will result in what the governor vowed never to do: kick the problem down the road.

"Next year's budget will start with a very large shortfall even if there's a good recovery," said Steve Levy, a senior economist at the Center for the Continuing Study of the California Economy in Palo Alto.

As we've said before, do you want to be a long term creditor of the state of California?