The California budget process can be very confusing and convoluted.

I want to make this very easy to understand today. We have a solution to the insufficient cash flow crisis to the 2009-10 budget. It is best described as a Ponzi scheme; in this case a quick investment of belief in a budget solution that leads California into a faster ruin of economic futures.

Allow me to sober up the Golden State today:

A budget with an operating deficit and no cash reserves to balance it is not a budget; this is called chicanery, or even fraud. To believe that we have balanced the budget by discovering only $14 billion of the actual $26 billion responsibility – while mired in the midst of a great recession – is plain ignorant.

This budget is still short today and it will be out of liquidity come Halloween. Boo.

The 2009-10 budget will have three lives come Thanksgiving, the next time Governor Schwarzenegger calls for an emergency session to stem the tide of a budget that will not come to life in 2009. Nothing like talking budget turkey during the family gatherings.

Alright, there are some successes here: no new or additional taxes, severe cuts to Cal-WORKS, In-Home Care fraud, Healthy Families and Medi-Cal abuse, three furlough days until June of 2010 and a radical knife to numerous educational expenditures across the K-12 and higher educational journey.

This Ponzi scheme even includes theft; as the state reaches into the local government’s wallets and steals over $4 billion already allocated for 2009. And the city of Rancho Cordova, California thought they had a balanced budget – think again suckers.

Hey, there is even a token of intelligence tossed in as it relates to the private sector and offshore drilling and we are keeping all of the criminals in prison - where they belong. (Although there is a $1.2 billion reduction to corrections that some believe could cause a release of prisoners; Arnold has pulled back from this idea.)

So there is something for everyone in this uneconomical solution to a $26 billion short fall as we travel toward the New Year. Does anyone really think that California is going to be gathering an increase in state receipts in the next six months; is next year is going to be a growth year in cash flow to the Belly of the Beast? And don’t tell me about another Obama stimulus check arriving to say the day.

It is July, by October we will be talking shortfall once again. The facts are obvious, this budget is established at, or near, California gathering $88 billion this year. The last time I checked we were on course to collect somewhere in the ballpark of $75 billion.

If you’re scoring along, that does not add up – Ponzi scheme.

In addition, there are new hurdles coming everyday:

The State Legislature has to vote this through on Thursday. There is no guarantee that the liberal puppets on the majority party side of the isle will be allowed to support such radical cuts by the string holding public employee unions. It could be a long, hot Thursday in downtown Sacramento…and then comes a furlough Friday after that. Better get it done before midnight.

In addition, the SEIU has threaten to either “walkout” or sue the state over the mandatory three furlough days. If they are successful in reducing the days from three to two, or even one, there goes the math once again. Increased spending in a budget that is already short.

To get to this amazing budget solution the legislature has to borrow money. By my figures the tricky moves operated surrounding the income tax collection date, the push on a single payroll day (June 30 to July 1) and the guaranteed return upon the borrow from educational funds has California into next year’s budget by a tune of $12 billion.

Nothing like a fresh deficit start next year.

Oh - before we forget – there are those 21 public employee union contracts to consider.

California needs to negotiate new contracts with the greedy unions after this budget is birthed. Remember, the “number one” fiscal drain upon California is the guaranteed and favored handouts that bolster the public employee unions of this state.

So as you can see, it is time to celebrate – for a day.

California has solved its 2009-10 budget, but as I said earlier, A budget with an operating deficit and no cash reserves to balance it is not a budget; this is called chicanery, or even better described as fraud.

A Ponzi scheme of a budget solution.

Hey, at least California has provided Bernie Madoff some entertainment as he sits in his jail cell, assuring him that he is not alone when it comes to misrepresenting and confusing others on the facts and figures.