When Gov. Jerry Brown first compared California's growing debt problems to a massive wall between the state's current position and its future, it instantly caught on with everyone from pundits to policy makers. After all, everyone knew the state had a problem that needed to be addressed.
Now, with his third state budget in the books, Brown says the 'wall of debt' is starting to crumble - a true statement, but only if you count the state's most immediate problems. And even then, keeping that wall from coming back is a task yet to be accomplished.
"By paying down the debt, it puts us in a stronger position when things go bad," said Brown when unveiling his 2013 budget in June.
Over the course of this year's budget season, the governor pushed legislators to keep tackling what in 2011 amounted to an almost $35 billion impediment of short-term fiscal borrowing - from its current level of about $27 billion to a path that will knock the towering wall down to a much smaller hurdle of just under $5 billion by the summer of 2017.
"He has tallied that up, and he has pledged to get rid of that," says Jim Mayer of California Forward, a bipartisan group focused on re-engineering government. "You've got to acknowledge that his predecessors didn't do that."
One predecessor, Mayer points out, helped lead an effort that ultimately built the short-term budgetary wall of debt even higher: Arnold Schwarzenegger.
"We consolidate the debt," said Schwarzenegger at a 2004 Sacramento rally in support of his measure, Proposition 57. "Then we refinance it and we tear up the credit cards and throw it away."
Prop 57 authorized up to $15 billion in short-term loans to cover the state's most immediate cash needs.
Whether the state's borrowing behaviors were truly curtailed seems debatable. But the action star governor's PR effort masked the truth: borrowing money ends up costing more in the long run.
"It's meant for the next 11 or 12 years, we've had to spend roughly $1.5 billion, or more, of money that could be spent on other purposes to pay off that debt," says Mac Taylor, California's legislative analyst.
Budget experts in the Brown administration now predict the full repayment of the 2004 Proposition 57 bonds, scheduled for April 2016, will cost the state $18 billion. It's unclear how the pace of repayment (and thus, the cost) would have differed had the global recession not occurred, but the decision to borrow was an important milestone in the history of state budget debt.
Even as the 'wall of debt' identified by Jerry Brown starts to come down, there are much larger walls behind it - long term expenses for which the state has no clear strategy to tackle. Some, like the cost of public works and infrastructure, are considered by analysts to be 'good' and expected debts. Others, like the state's $11 billion IOU to the federal government for loans to keep its unemployment insurance fund afloat, are more worrisome.
And the most volatile issue -- the cost of public employee pensions and health care - seems, for now, too tough to tackle. In fact, the political and ideological forces involved in the pension debate can't even agree on the size of the liability, the 'height' of that wall of debt.
Legislative Analyst Taylor says other budget decisions, while not truly debt, are a form of borrowing by state government. He points to a recent budget deficit 'gimmick' that requires the self-employed and others to pay more of their income tax liability earlier in the year... an amount which, if too high, the state then refunds later but amounts to a short-term loan to the government.
Taylor says much of the debt debate could be resolved with the state having a cushion of cash.
"We need to build up a reserve in good times," he says, "because the reason that we use many of these actions that created the wall of debt was because we didn't have any other alternatives."
Lawmakers are now considering a 'rainy day reserve' measure for the 2014 ballot, one which would replace a measure already slated for the ballot that Democrats have disliked since it was crafted during the 2009 budget crisis negotiations.
Others, though, say elected officials need to think more broadly, that more effort needs to be put into creating cash... by raising revenues through help for the private sector.
"The state, working with cities and regions, is going to have to get very serious about making the state economically competitive," says California Forward's Mayer.