Recently, a witness at one of California’s reparations hearings demanded “where’s the money?” Gov. Gavin Newsom’s announcement that the state miscalculated its deficit by $10 billion seems to answer that question. As his reparations Task Force demands as much as $1.2 million per eligible black resident, Newsom recently balked at cash payments. After years of using reparations as a political issue and insisting that such payments are a moral imperative, many are pushing back that this bill is now due. A card will just not do.
The new figure puts California’s debt at a towering $32 billion.
There are various contributors to the shortfall including a progressive tax system that makes revenues dependent on the income of wealthy taxpayers. When the stock market falls, revenues fall. There is also the mass exodus from the state of higher income citizens. Some are fed up with rising crime and taxes. It does not help when California publicly debates not just massive reparations payments but retroactive taxes for those who leave the state.
There are also now mass tech layoffs and a building recession.
Newsom expressed confidence that the state could handle the deficit and that is likely true. The state has a massive budget of $306 billion and he is looking at cuts. He has already scaled back funding for climate proposalsĀ to $48 billion, from $54 billion.
He also has a net reserve. However, just a year ago, Newsom was publicly celebrating a claimed budget surplus of $97 billion and said it was “simply without precedent.”
This year, Newsom admitted that the state would face aĀ deficit of $22.5 billion, which he called āmodest shortfall.ā
Democrats are now calling for increasing taxes on large corporations and suspending a major business tax credit to raise new funds. Newsom is opposing those proposals.
The budget shortfall is massive, but so is California’s economy. The state also has a reported reserve fund, though this deficit would largely wipe out that fund of $37 billion and Newsom has vowed not to touch it.
The immediate political question is whether, after years of politicking on the issue, residents will be willing to take an IOU or non-cash “reforms” in lieu of reparation payments.
The longer term question is how to reverse the exodus of high-income citizens who are tired of rising tax and crime rates. While some in the media have pushed back by saying that the state has more people moving in than out, California and New York are losing higher earners who pay most of the taxes. Much of the difference is made up in foreign immigration.
Forbes put California as the state with the highest net loss of households followed by New York and Illinois. The Bay Area is one of the hardest hit.
I have always loved California where I spent much of my youth due to my grandparents living in Cherry Valley (near Riverside). I love the hiking and beautiful coasts. I believe that the state has the resources to pull out of this crisis, but I am increasingly concerned about the trajectory of the state.Ā Across the board, California has the highest taxes in areas like gasoline and other necessities. At the same time, while Democrats continue to insist that the wealthy do not “pay their fair share,” the top 5 percent of high-income taxpayers in California pay 70 percent of personal income tax revenue.
Nationally, the top one percent of taxpayers pay 42 percent of all taxes.
That is why the exodus could prove a cascading problem for California. While Newsom has run ads attacking Florida, that state is exploding in population, including many high-income households.
Calif has an $18.9 Unemployment Debt ( Money borrowed from Fed Gov’t to cover Unemployment benefits ) that it just recently forfeited on. Companies will have to pay more in Calif to cover that cost. Now what about that $800 billion dollars Reparations payments promised? Guess that will be covered when the next earthquake sluffs it off into the Pacific. Most states and the Fed Gov’t are now undeclared bankrupt. An economic killing Big Reset coming very soon. Selah
There cannot be any unemployment.
The government said today that the Mexicans et al. who are illegally invading the southern border are here to find jobs and to work – they want to work in the U.S.
There cannot be any justifiable payments or otherwise expenditures for unemployment because the illegal invaders claim they are here to work in the U.S.
Thereās a heartbreaking article at CNN today. It tells the story of a mother who lost her son to drugs in San Francisco. Amazingly, at the end after all her sadness brought about be Democratic policies in California she still declares herself a liberal. If you would have seen the same story in The Wall Street Journal you would swear that she was repeating the positions of the right on drugs and crime. The lament of a mother deceived. https://www.cnn.com/2023/05/14/us/san-francisco-drugs-homeless-sidner-tws/index.html. Thank you Mary mother of God.
This exit tax proposal against the wealthy. Is it a redux of Edwards v California, 314 US 160 (1941)? There SCOTUS relieved Edwards of a misdemeanor conviction under California law for importing his indigent Texas brother in law to California during the Great Depression. The Court struck down the California penal statute as repugnant to the national citizen right to travel under the 14th Amendment privileges and immunities clause. One of the cases it cited was its strike down of of a Nevada exit tax on transportation out of that state. If national citizenship carries the right to enter poor, it is ineluctable that it carries the right to leave wealthy.
$32B in the hole – what do they have to show for it? LOL.
F’ing leftists, so incapacitated by Dunning-Kruger. Do they ever require evidence of success for their their proposals? Of course not, there isn’t any to find, unless getting people hooked on government is the success they are looking for. Helping people, helping communities, helping society at large – they have ZERO success. None, nil, nada. Just more problems, more fake realities.
Wake up.
Oh, but if you want to be shadow-ruled by, we’ll we’ll never know now:
The White House has stopped requesting that American think tanks disclose funding from foreign governments. āThis is not the policy of the U.S. State Department,ā an agency spokesperson said last month.
The left is sick. they have nothing of substance to offer any US citizens, except their little cabal.
in the early 2000’s, Craig Barrett, who was then the chairman of Intel’s board, wrote an op-ed that ran in the San Jose Mercury. He said that any CEO who came to the Board with a plan to build a manufacturing facility in California should be summarily fired. He then went on to castigate the anti-business environment, particularly manufacturing. Two weeks later Intel announced plans to build a new semiconductor fab in Texas.
Such is the end of each and every socialist/communist venture. I hope each and every democrat prog/left in California experiences the tragedy that is going to follow. What a shame that such a beautiful State fell under the power of such a delusional ideology with the massive aid of the democrat party. My only hope is that the remainder of the functioning states (NY and Ill not included as they are next on the list of this slippery slope) will need to pay the bill to save this mess. If anything, I would wish the repair cost would come out of the Soros fund that created this mess.
So Presidential wannabe Governor hair gel miscalculated his state debt by only $10 Billion ??? For Democrats, that’s just a rounding error sweetie. If Nancy Pelosi were still Speaker, she would have already transferred to money. Pay them in Bitcoin, the Feds new digital currency. It’s all in the cloud baby !!
$32 billion is no doubt a low ball estimate. In the months ahead that number will probably double and get worse in 2024.
Given the sketchy election system guaranteeing one party rule, no one dare start looking for the missing 97 billion surplus of FY 2022.
Imagine, if he can do that to CA, what he could do to the country if he were elected president? It’s scary to consider. And here I am today, a retired, senior citizen, trying to figure out the most effective program for a small club of older women to participate in to raise funds for hunger.
“Goofy Gavin” could do very little as president if America enjoyed a Supreme Court that fulfilled its sworn-oath duty to support the clear and evident, meaning and intent of the Constitution.
AMERICAN RENAISSANCE
The only thing that will help at this point is a complete do-over, paying particular attention to the constitutional power of States to maximally restrict voting, the severe constitutional restrictions on taxation and regulation by Congress, and the severe constitutional restrictions on immigration in the Naturalization Act of 1790, effectively the uncodified immigration law of the Founders.
The singular American failure has been and remains the judicial branch, with emphasis on the Supreme Court.
As it corrected the deliberate and totally corrupt decision by the 1973 Supreme Court on abortion, the Supreme Court must correct and remedy all the damage done by its failure to declare secession constitutional in 1860, which would have nipped Lincoln’s entire “Reign of Terror” in the bud. Secession was/is not prohibited and is ubiquitous throughout the world and history.
California is the largest sub-nation economy in the world and if it were its own nation would rank the 5th largest economy in the world, just behind Germany and ahead of India. It produces approximately 15% of the GDP of the United States. It did not achieve this status overnight and such production is a testament to the genius of this nation. You let the individual citizen, who is motivated to achieve their potential to dream their dreams and clear the pathway for them to bring these dreams to a reality. Do this for millions and millions of little businesses and the result is innovation and prosperity.
Those who are bestowed the privilege of leadership should enter such positions with sober humility and a great appreciation for the individual worker and for their families. If they (California leadership) will continue to help little (and big businesses), they will continue to prosper. If leadership takes another pathway, it will only be a matter of time before innovation is throttled and or killed and the “Goose That Laid the Golden Egg” will exist no more.
That is why businesses and organizations who weather the good and the bad times over the decades and even for centuries, consistently review their founding mission statement and keep it top of mind. If they stray too far from the mission and core values that made them great, they will eventually fall by the wayside. It may not happen overnight, but it will trend in an unfavorable direction and eventually hit critical mass in the cycle of demise.
E.M.
Well said.
Read about more than a few small businesses leaving CA due to the over regulation, fees and license to just even open the doors.
Not a small businesses friendly state.
E.M. : Very well said and thoughtfully written. “The cycle of demise.” I think they are little further into the cycle than you seem to think. I’m a cup-half-empty sort of person. You seem to be on the brighter side perhaps.
Randy, unfortunately, I think you are correct regarding their status in the cycle of demise.
When you think about it, it is a lot like the Rocky movies. Apollo was a victim of affluence and success. He forgot what made him the best and became complacent. Rocky had the grit and determination to go the distance, then, when he became successful, he, also, forgot the basics and from where he came.
Seems like a great time for Soros, Gates, Hollywood, WEF, MSM and all the rest to jump in and pay for reparations? They talk a good game.
Margot, how about adding the Universities and their huge endowments? Harvard alone has a THIRTY-NINE BILLION DOLLAR endowment that they are sitting on. Of course it is easy to just give black kids 200 extra points on the SATs rather than actually reach into their pocket to give money.
In this same vein why does Liz Warren always screech, and I do mean screech, at billionaires telling them to pay more and yet she never says a peep to colleges? It is all a giant scam.
And now Newsom says he’s ok with paying cash reparations, with other people’s money.
It’s absurd of course, right?
Or is absurd driguer?
āMath Sucksā. No doubt about it and even worse when itās your balance sheet. Nice to live in a state that has a mandated balanced state budget and surplus virtually every year. Low budgets also make it impossible for useless, mindless government trolls to hang around and stick their nose in everyoneās business and run the greater nanny state.
Productive people learned how to do maths. It really is that simple. Learning maths imposes logic, discipline and rigor on mental processes that carry on into ther areas of life. It’s not surprising that progressives oppose maths as progressive dogma is fundamentally illogical.
And now the maths dictate that it’s safer, cheaper, nicer and cleaner to live somewhere other than California. Nothing personal Newsom, it’s just what the numbers say.
OT:
To all of the mothers on this forum including Cindy, Karen, Prairie Rose, and others:
St Thomas Aquinas defined love as “to will the good of the other”. Mothers do just that.
My mother passed away in my 30s, and I think of her every day because she willed the good of her son.
May your day be blessed and full of God’s abundant graces for saying “yes” to most difficult and challenging job in the universe. None of us would be here if not for motherhood.
Happy Mother’s Day!
NB: We are en route to Outer Banks, Kitty Hawk, for a much needed vacation.
Love one another, even the trollsš
pax
Estovir,
Excellent! Enjoy your time off.
Estovir,
Well said and played!
May all mothers have a good day today.
Have a good vacation!
If one studies the history of a city like Detroit which was once the virtual hub of the auto and music industry, the future for these progressive, corrupt major cities and states is not bright!
Ken,
Detroit is a good example and a warning to those who do not understand how actions (or lack of actions) have consequences.
Gets even better!
The same Reparations committee, is now calling for the end of cash bail and prosecution of low level crimes.
Then there is a Democrat San Fran supervisor who is introducing draft legislation to prevent security officers from drawing their firearms to protect property. This one is questionable as some are argued it was a Walgreens security guard who shot and killed a would be thief to protect property, where as the San Fran DA deemed it a case of self-defense after interviewing witnesses and review of security video. After the shooting, there were protests to disarm all security guards.
Honestly this could be a interesting social experiment. Let us see for one and all on display what soft on crime, no cash bail, and other “reforms” have on a city.
Could be fun. As long as the experiment stays in CA.
Anyone recall the video of the Target in CA that had some products behind security glass? If some of these reforms pass and are enacted, imagine an entire store behind security glass. Why stop there! How about having to have a registered “membership” and before entering showing a valid picture ID?
Nah! Easier to just close the store and leave as others have already done.
Good times!
NEWSOME – BAD/WOKE Policies-Destroys a Great State/Economy & Much Potential to RUIN – $32 Bil Deficit this year and next even higher. Drives away people and businesses who could contribute. Big Tech laying off or moving to Texas/Florida. Attracts those who rely on the State for $$$. California has much Potential, from Farming, Natural Resources, Tech, Life Style and etc. What is happening in California will and is spreading to other WOKE Run states. California/Newsom need to cut spending drastically, stop giving away $$$.
Remove Memphis from Tennessee Crime rates and note the difference, same for Baltimore and Maryland, or Atlanta and Georgia, or Philadelphia from Pennsylvania….simply pick any one of your favorite Democrat controlled urban area.
For a follow up….pick the crime rates apart by Ethnicity and see. how your Liberal views are altered.
One example is Chicago Murder Rates…..and sorry Toto but Cops do not cause Murder Rates by picking on one poor ethnic group…..that is an own goal perpetrated by the folks doing the crime.
Good points, Ralph. As you note, several red states which Gov. Newsome criticizes about crime have high densities of Black Americans, resulting in elevated crime stats for those states. He’s actually criticizing Black communities in those states, though he conveniently fails to make the distinction.
He’s waffling on reparations, too, so I guess that makes two reasons he’s a racist.
Gov. Nuisance, whose line of empty suits is the envy of Hollywood, will likely be the next Democrat nominee for President.
Joe’s campaign is a head fake because he’s useless even as a figurehead, but he doesn’t want to become a lame duck before it’s absolutely necessary. He served his purpose. He kept Kamala out of the Oval Office, and she’s the only Californian who won’t have a job in D.C. if Nuisance. wins the Presidency.
The Governor is desperate for everyone to believe California is a utopia and that red states are violent-crime zones. Actually, only 2% of counties account for 56% of murders–and they’re almost all Democrat disasters–but he leaves that part out. Can’t have an empty suit without an empty head. Nobody will be fooled because millions have already fled the Venezuela of the West Coast and taken the truth with them.