Here's one way to contain California's wall of debt

Just take on as little as possible. A little-discussed aspect of the state's budget battle is a sharp reduction in the amount of bond offerings. In 2009, California sold $20.5 billion in general-obligation debt. The next year it was $10.4 billion. This year it's expected to be $5.2 billion. From Bloomberg:

Reducing state indebtedness is crucial to building investor confidence, [Gov. Jerry] Brown said at a press briefing to unveil his proposed $92.6 billion general-fund spending plan for fiscal 2013, which begins in July. "That's one thing I'm really committed to," the Democrat said. "We see what's going on in Europe. We see the pathetic situation in Greece."

Brown's effort to contain the deficit has helped keep down borrowing costs. This is not a well-understood part of the budget story - nor will it result in instant results. But it is a big deal. "California's economy is huge, it's diverse and it's moving in the right direction from a fiscal perspective," said money manager Neil Klein. From a Bloomberg story in September:

California was able to offer the lower yields after Standard & Poor's awarded the revenue anticipation notes its highest credit rating since 2007. The company also rescinded the state's negative long-term outlook after the austerity budget was enacted in June. Yields on the state's short-term debt have dropped by about 80 percent compared with last year, while rates on top-rated one-year general-obligation debt have decreased by one-third, according to Bloomberg data.