Other states are also facing pressure to cut prison spending in order to weather fiscal crisis. New Jersey and South Carolina have weighed proposals to divert inmates with substance abuse issues into treatment, rather than paying far more to keep them locked up.

It may be a rare occurrence of economic incentives coinciding with rational public policy, but there's no guarantee that simply cutting prison spending will lead to a more just way of dealing with crime and incarceration.

Governor Schwarzenegger's administration recently backed away from a plan to overhaul prison health services to meet basic standards of care for inmates.

Even if it complied with the court ruling, the state's prison system would still be overstuffed; the judges capped the population at 137 percent of the official capacity of 84,000.

And release by the state wouldn't necessarily bring liberation for thousands of immigrants stuck in the system. The Governor has proposed shunting many undocumented immigrant inmates into federal custody, which would route them into deportation proceedings in a system that activists also decry as dysfunctional and abusive.

California's Attorney General Jerry Brown argued that the court's decision offered little guidance on how California should juggle a massive budget deficit and reform its prisons at the same time.

But there's no shortage of ideas for sensible reform, just a lack of political will to realize them.

Aside from the political boogeyman of early release, critics of California's prison system say the key to reducing the inmate population is overhauling sentencing policies, such as the draconian three-strikes law and racially charged parole programs that seem designed to rope people back behind bars.

A coalition that joined the legal challenge, California United for a Responsible Budget, has been pushing proposals to shutter facilities across the state and reinvest in community-based programs, including drug treatment under Proposition 36 and support services that help the formerly incarcerated reintegrate.

Now that the clock is ticking for California to scale back its prison system, those ideas could come in handy--if the state is willing to look beyond fiscal projections and start to reverse years of regressive criminal justice policy.

Image: California Department of Corrections and Rehabilitation