Here we go again.

When it comes to the state budget, the only thing that seems to change is the number of billions by which it's out of balance. A year ago, state officials had to plug an unthinkable $15 billion. A few months later, as the economy worsened, they were faced with an insurmountable $40 billion.

And now, even after Gov. Arnold Schwarzenegger and legislators passed a package of spending cuts and tax hikes that was believed to have tamed the deficit, the state faces a staggering $24 billion shortfall through the middle of next year.

Staples of the modern-day state - from welfare and health care for the poor to funding for our children's education - are on the chopping block.

State Controller John Chiang has implored the Legislature to pass a budget by Monday to avoid a fiscal meltdown this summer. But legislators are expected to miss that deadline by at least a few weeks.

Of course, California isn't alone; governments across the country are grappling with the deepest recession since the Great Depression. But in some ways, the state's woes are self-inflicted: Our fortunes rest with a system that produces huge tax windfalls when the economy flourishes, then acts as if the good times will never end.

Today, we take a crack at demystifying the state budget. The goal: to help you understand how we got into the current fix and why Sacramento has become so dysfunctional when it comes to managing the state's finances.

Contact Mike Zapler at or 916-441-4603.