Will Budget Gridlock Remain in Sacramento?

SACRAMENTO Democrats had hoped to ride on President-elect Obama's coattails by gaining 8 seats in the state legislature. That would have given them a veto-proof majority that to make it easier to pass budgets and new taxes, but they came up very short.

As freshmen lawmakers go through orientation classes before officially starting next month, it appears ideologies will remain strong. Democrats will still fight deeper cuts to the state's troubled budget.

"We're going to have to do everything we can to fix our budget. We have to make sure folks are taken care of, and that we pass policies that are reflective of the needs of our communities," said Assm.-elect Manuel Perez/D-Coachella.

To get to the two-thrids majority required for financial matters, they'll still need some Republicans votes.

But, if proposals include tax hikes, the chances of newly elected GOP members jumping on board are miniscule given that most them already signed a national no-tax pledge -- a signal gridlock will likely remain.

"Adding tax burden right now to an already highest tax rate in the country would be devastating to our economy. So we have got to find other ways to generate revenue," said Assm.-elect Jeff Miller/R-Corona.

Meanwhile, the clock is ticking for the current members whose terms end in two weeks. Anything they don't solve will be inherited by the new crop. That includes a whopping $28 billion deficit.

Senate and Assembly leaders met again Thursday with Governor Schwarzenegger's advisors.

Though there's talk some Republicans may be coming around to raising taxes to balance the budget, there is still no compromise, sending a strong message to Wall Street.

"If we don't show and demonstrate to the markets out there that we're serious about reducing our debt, we're going to run out of money. And this is as serious as a heart attack, and we're taking it every bit seriously," said Sen. President Don Perata/D-Oakland.

The 38-member freshman class knows very well what they're getting into.

"It'll be very painful. I have to admit that" said Assm.-elect Paul Fong/D-Sunnyvale.

The hope now is with a Democrat in the White House, more federal dollars will flow to California to ease its budget crunch.

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