On the day last month when the Legislature finally passed the budget and got out of town for its summer recess, Gov. Gray Davis promised to convene a group of "distinguished" Californians to help close the remaining $8 billion shortfall in state finances. "I fully recognize there is more work to do," he told editorial writers in a conference call. His study group, Davis said, would have recommendations ready for lawmakers when they returned from their three-week break on Aug. 18.

Well, the Legislature was back last Monday, and there was no budget plan waiting on their desks. Davis never appointed the task force. But if Davis is still looking for a group of distinguished citizens with big ideas about the budget, I know where he can find them: on the ballot, competing to replace him should the voters decide to recall the governor on Oct. 7.

A review of the six candidates with the most support in recent polls shows each has suggested budget plans in varying levels of detail. Some call for massive tax increases, and others suggest deep spending cuts. Several include creative ideas, some perhaps too creative. But after the tricks and gimmicks that have gone into state budgets over the past several years, Davis is in no position to be picky.

The flood of budget schemes stands in contrast to a year ago, when Davis wouldn't talk about the state's finances and his Republican opponent, Bill Simon, gave up suggesting specific fixes out of fear that the Democrats would paint him as heartless.
This year, a budget plan of some sort or another seems to be the price of admission for candidates seeking to succeed Davis.

"For months now, Republicans have said that the justification for recalling Gray Davis was that he ran for reelection without honestly addressing the state's budget crisis," Lt. Gov. Cruz Bustamante told reporters gathered in front of his suburban Sacramento home last week. "No one, not Arnold, not me, not Bill Simon, not Peter Ueberroth, no one running in this recall election should be allowed to campaign without offering their specific and complete plan to fix it. All of it."

Bustamante was first out of the chute with a plan that relies almost exclusively on new taxes. Calling his plan "tough love" for California, he implies that it's all about shared sacrifice. But most of the sharing would be done by business owners and those with high incomes.

The former Assembly speaker from Fresno would increase income taxes on the top 4 percent of filers, base property taxes for businesses on annual reassessments and eliminate tax provisions that give favored status to new businesses, research and development, and closely held companies whose owners report their earnings as personal income rather than corporate profits. He would also increase cigarette taxes by $1.50 per pack and alcohol taxes by 25 cents per gallon. He would reduce one tax, relieving the owners of vehicles worth $20,000 or less of the recent tripling in the car tax.

But Bustmante's plan is neither as complete nor as specific as he said was necessary. He assumes $500 million in savings from fighting Medi-Cal fraud, for example, a number that might be achievable but probably not in one year. And he proposes $2 billion in cuts that he does not specify, even though it took lawmakers six weeks this summer to come to terms on a package of spending reductions half that size.

At the other end of the spectrum from Bustamante stands Simon, the Los Angeles businessman and philanthropist who warned a year ago that the state's finances were worse than Davis was letting on. Simon once again says he thinks the shortfall is larger than advertised, by at least $1 billion. And he would widen it by another $4 billion by repealing the recent tripling of the car tax implemented by Davis without a vote of the Legislature.

To close the gap, Simon proposes about $5 billion in specific program reductions and suggests the state could save $4.6 billion by eliminating waste, overhead and mismanagement and another $3 billion by catching fraud with an independent performance audit. He would generate another $800 million, he says, by selling unused state property.

Simon's spending cuts include suspending the cost-of-living increases in state welfare programs, eliminating benefits and reducing eligibility under Medi-Cal, reducing financial aid for university students and consolidating the Franchise Tax Board and the state Board of Equalization.

Simon says the state could save billions in the bureaucracy by contracting out, changing procurement practices and using performance audits. But while almost every one of his suggestions makes sense and ought to be tried, no one really knows how much money the changes would save, or how long it would take to see whatever savings are achieved.

Another Republican candidate, State Sen. Tom McClintock of Simi Valley, has long been considered an expert on California's fiscal fitness. He knows as much about the budget as anyone in Sacramento. He has said he would repeal the car tax on his first day in office and cut waste and fraud while restructuring government. But oddly, he has yet to propose a detailed plan for balancing the budget.

He hopes to make government more efficient by enacting a measure to create a commission modeled after the federal panel that helped close unneeded military bases in the 1990s. The commission would prepare a list of unnecessary or redundant state programs or offices and submit it to the Legislature, which would have to approve it or reject it all in a single up-or-down vote.

Peter Ueberroth, the former baseball commissioner and Olympics czar, is running as the candidate of "truth, substance and specifics." But his budget proposal is more sizzle than steak. He suggests that the state could generate $6 billion by granting amnesty to tax evaders who turn themselves in and pay what they owe, but no expert has ever suggested that a number that high could be achieved, and Bustamante is counting on just $100 million from the same technique.

Ueberroth also proposes saving $1 billion by renegotiating state labor contracts, even though Davis has already booked the same amount from the same technique in the current year. Another $1.5 billion could be saved, he suggests, by cracking down on fraud in Medi-Cal, the idea Bustamante suggested could save one-third as much.

Actor Arnold Schwarzenegger, meanwhile, has outlined his principles -- no new taxes, repeal the car tax increase, improve the business climate and adopt a spending cap -- but has declined to name a single program among those that he would cut to close what would be a $12 billion gap in the budget.

Arianna Huffington, an independent, has yet to unveil a full budget plan but has said she would repeal the car tax increase, boost taxes on corporations and commercial property and freeze spending except for adjustments for inflation and population growth.

If none of these ideas suit Davis, he could always turn to one of the other candidates on the ballot, the buxom porn star Mary Carey. Having come naturally to the attributes that have made her a celebrity, Carey has floated one big idea for closing the budget gap: Tax breast implants.

How they would handle the shortfall
Most of the major candidates for governor have proposed outlines for how they would approach the state's chronic budget shortfall, which is now expected to be between $8 billion and $12 billion in the next fiscal year. Here are the highlights of their plans:

Cruz Bustamante, lieutenant governor, former Assembly speaker
Raise taxes on the wealthy, on business property, on cigarettes and alcohol, and on business owners, while reducing car taxes on vehicles worth $20,000 or less. Require employers to provide health insurance for their workers or pay a special tax to the state. Increase spending on education. Crack down on Medi-Cal fraud.

Arianna Huffington, author, commentator
Raise taxes on corporations and commercial property, repeal increase in vehicle license fee, temporary freeze on spending with allowances for population and inflation, reduce prison budget and roll back salary increases for prison guards.

Tom McClintock, state senator
No new taxes, repeal increase in car tax and then abolish it altogether, new state spending limit tied to population growth and inflation, establish a commission to identify bureaucratic waste and force the Legislature to vote up or down on its recommendations, adopt "Arizona plan" for workers compensation, cancel energy contracts with private electricity providers.

Arnold Schwarzenegger, actor, businessman
No new taxes, repeal car tax increase, new spending limit, significant cuts in state programs except education, litigation reform, workers compensation reform, reconsider recently passed benefits for labor.

Bill Simon, investor
No new taxes, repeal car tax increase, eliminate cost-of-living increases in welfare programs, eliminate optional federal benefits in Medi-Cal, sell unused assets, amnesty for tax evaders to generate revenue, increase contracting with private firms for state services, procurement reform, reduce pensions for future public employees.

Peter Ueberroth, businessman, former baseball commissioner
No new taxes, new spending cap tied to population growth and inflation, 5 percent cut in general fund spending, renegotiate state employee contracts, amnesty for tax evaders to generate revenue, crackdown on Medi-Cal fraud.

Note to readers
A review of the state budget proposals of major candidates, including Bill Simon, in the Forum section today was printed before Simon withdrew his candidacy.