According to Gov. Arnold Schwarzenegger, California's financial condition is "fantastic." Spending has been brought under control, the budget has been balanced, and our debt is being paid down. But, as Winston Churchill once said, "It is not possible to state the opposite of the truth with greater precision."

To the governor's credit, he has proposed some long-overdue spending reforms, most notably conforming state welfare-eligibility standards to federal law.

But there's very little else to praise about the governor's handling of the state's finances. In fact, spending is growing faster than it did under his recalled predecessor, Gray Davis. The state is now running the biggest deficit in its history, and the only way it can pay its bills is because of massive borrowing carried over from 2004, contributing to a doubling of the state's debt burden in just three years.