Massive California budget deficit awaits Jerry Brown

Outgoing Gov. Schwarzenegger has made a final attempt to solve the budget crisis by calling a special session of the legislature. But the Democrats yawned, saying they’d sooner wait for incoming governor Jerry Brown whereupon they resolutely plan to work on a “global solution” to the budget rather than the “piecemeal” foolishness being proposed by Schwarzenegger.

No, really, they actually said that. Where have they been then, these past several months? Because piecemeal approaches are all we’ve gotten – except of course when the legislature adjourns for lengthy vacations in the middle of a demonstrable crisis, something they’ve done several times. While the budget problems do seem intractable, our lackadaisical legislature certainly appears disinterested in it. Plus, everything in Sacramento seems to happen in ultra-slow motion, except for them voting themselves more vacations, that is.

The Republicans are just as detached from reality. They vow no new taxes, at all, ever. The Democrats don’t want to cut spending. By law, California must pass a balanced budget. But the numbers just aren’t there. Expenses exceed revenues for the foreseeable future by a staggering $20 billion a year. Legislators can huff and puff all they want, but the simple fact is California will inevitably default on debt if drastic measures are not taken. This means that taxes must rise and spending must be cut. There is no way around that.

Read the whole article on CAIVN, where I write three articles a week.

In a related story, a successful real estate developer in California says he’s leaving California for someplace where taxes and costs aren’t so steep.

Apparently, I am not alone. Migration out of California exceeds the rate of almost every other state. Why are my fellow “high-earners” leaving the Golden State? Maybe it is because California ranks nationally in the bottom two for business friendliness while placing third in state income taxes.

But California’s budget crisis means taxes and fees must continue to rise. Meanwhile, states like Texas and Nevada have no income tax.

  • Jimmy

    The Costs of Illegal Immigration to Californians focuses on three specific program areas because those were the costs examined by researchers from the Urban Institute in 1994. Looking at the costs of education, health care and incarceration for illegal aliens in 1994, the Urban Institute estimated that California was subsidizing illegal immigrants to the tune of about $1.1 billion. The enormous rise in the costs of illegal immigrants over the intervening ten years is due to the rapid growth in illegal residents. It is reasonable to expect those costs to continue to soar if action is not taken to turn the tide.
    Minus the cost of illegals from our 24 billion budget, and we’re looking at better times.

Powered by WordPress. Designed by WooThemes