The nonpartisan Legislative Analyst’s Office announced this morning that California has a projected $68 billion budget deficit through the next fiscal year, a sharp but entirely predictable turnaround from surpluses Governor Gavin Newsom bragged about just last year.
This deficit will have significant consequences for education funding and other programs, as economic reality brings legislative Democrats’ overspending and overpromising back down to earth.
The Vice Chair of the Senate Budget and Fiscal Review Committee, Senator Roger Niello offered his reaction to the LAO’s announcement: “Despite all warnings that it was unsustainable, California’s tax-and-spend majority increased state spending by $116 billion over the last six years, nearly doubling the general fund budget in that short time. Republicans cautioned that this level of spending would lead to greater deficits, and it would be more prudent to show restraint. Unfortunately, the majority party ignored those warnings, enacting a budget in June that already projected a $14 billion deficit, even before the LAO’s new report revised the deficit to $68 billion.”
Senate Minority Leader Brian W. Jones added, “Governor Newsom and Democrat lawmakers turned a $100 billion surplus into a $68 billion deficit in just two years. Even more alarming, the five-year deficit forecast is an astounding $155 billion, thanks to the overspending Democrats jammed into the last few budgets. California built up significant budget reserves under the requirements of a bipartisan 2014 initiative, but Democrats have managed to outspend even what the reserves can cover.
“During my first budget cycle as an Assemblymember in 2011-2012, California operated with a $143 billion budget. Fast forward to the 2023-2024 budget cycle, Democrats’ spending soared the budget to a staggering $311 billion. In a mere decade, our state’s budget has more than doubled in size, an exponential surge, while the financial capabilities of Californians certainly haven’t undergone such a monumental increase as many struggle to afford to even stay in the state.
“Hopefully, the supermajority will see it is time for a more realistic budget strategy, instead of throwing money at a laundry list of projects that sounds nice on the national television debate stage.”
California Senate Republicans have long advocated for fiscal discipline, especially when California saw record budget surpluses becoming record spending. Below are a few examples of misplaced priorities and misused tax dollars contributing to the budget shortfall:
- Billions of dollars wasted on the California High-Speed Rail boondoggle that’s decades behind schedule and tens of billions of dollars over what was promised to the voters. This includes $889 million just in the 2023 budget. Even with a new $3 billion from the federal government, there is no conceivable financial plan to complete the system.
- $4 billion in state funds were given or promised to appease the politicians that run the failing BART system and other transit systems, which are relied on less and less by commuters.
- With homelessness being one of the most important challenges we face, the majority party has spent $20 billion over five years on programs that do not tackle the core of the problems and have only resulted in the increase of homelessness.