As one prominent Democrat dropped out of the race to replace Governor Arnold Schwarzenegger next year, the bad news about the budget as it affects health care in the state makes one question why the job is so enticing.

According to a report in the NY Times, the state budget deficit may be as large as $7 billion this year, just months after a budget deal was reached between the Governor and the state legislature. To be fair, some of the deficit is the result of recent court orders that seek to block cuts in health care programs in California.

The state's plans to cut $80 million from its budget for In-Home Supportive Services was stopped by a judge, and in September, a federal judge stalled $117 million in cuts to the state's adult day health care services program.

Also, Insurance Commissioner (and Republican gubernatorial candidate) Steve Poizner has filed a suit to block the sale of a portion of the State Compensation Insurance Fund. The fund is California's quasi-public workers’ compensation insurer of last resort. The high end of projections would have the sale of part of the State Fund to bring in almost $1 billion.

Additionally, California Controller John Chiang (a Democrat) said that state tax revenue was $1 billion below projections in the first quarter of the fiscal year. This is because of continued high unemployment and a reduction in corporate in sales tax. Some projections say next year’s budget deficit could be in the $10 to $20 billion range.

In the Times, California’s state treasurer, Bill Lockyer, refused to paint a rosy picture of the situation.

The budget is “a train wreck.” That is “going to get worse.”