Good news, California: Surplus is $2.4 billion
Source: San Francisco Chronicle
For the first time in nearly a decade, California is collecting more revenue than it is spending and will finish the fiscal year with an extra $2.4 billion, according to a report released Wednesday by the Legislature's nonpartisan budget analyst.
The good news comes after an era that saw one of the worst budget crises in California history - the fiscal shortfall sank to $60 billion in the 2009-10 budget, the state controller mailed IOUs to vendors in 2009 and state lawmakers slashed programs year after year to make ends meet.
Now, thanks to the passage of Proposition 30 last year and the improving economy, California is looking at surpluses over the next six years - even after the temporary taxes under Prop. 30 expire, according to the Legislative Analyst's Office.
The legislative analyst projected surpluses of $2.4 billion by June 2014 and $5.6 billion by June 2015. Reserves are projected to continue growing to nearly $10 billion by June 2018.
Read more: http://www.sfgate.com/politics/article/Good-news-California-Surplus-is-2-4-billion-4997158.php
mucifer
(23,374 posts)long time . We have a dem governor. Yet, we have crazy amounts of high debt and it gets worse every year.
sakabatou
(42,083 posts)mucifer
(23,374 posts)And the mayor of my city Chicago calls himself a democrat, too.
I am proud to say I didn't vote for Rahm.
LittleGirl
(8,261 posts)He's a republican!
mopinko
(69,806 posts)me "i'm so happy to meet you, your honor. i'm your only fan"
hoping he says, "oh, i have others"
me "i'd love to meet your family some day."
(i actually do approve of MUCH that he has done as mayor. and he is very funny.)
JDPriestly
(57,936 posts)but we all pay higher sales taxes. That's how California solved this problem under the leadership of Jerry Brown. He deserves a lot of credit.
Abukhatar
(90 posts)without the Republican obstructionists - they had thier chance when they deposed Gov Davis but thier destructive policies resulted is almost a decade of financial troubles
Scuba
(53,475 posts)They'll toss you a few bones on social issues (e.g., gay marriage) but still tax food for crying out loud.
mucifer
(23,374 posts)Art_from_Ark
(27,247 posts)But at least it's only half of the regular tax rate.
arcane1
(38,613 posts)ReRe
(10,597 posts)California.
Our little laboratory of democracy.
mpcamb
(2,855 posts)Was in the first years of Schwarzenegger's term (11/03-1/11 ). i.e., inherited from Grey Davis [San Francisco Chronicle: "For the first time California is collecting more revenue than it is spending California is collecting more revenue than it is spending ,,,,"]
Ah, those fiscally responsible Republicans, who brought on a decade of wallowing in debt.
I'm not a native Californian, nor a resident thereof. Seriously, I don't think I'm clear on what you're saying. Maybe a DU-er from Call-a-forn-i-a can answer your question about the prosperous years of Schwarzenegger. Didn't most states pretty much go belly-up shortly before or after Sept 14, 2008? Wasn't Enron tangled up in the Grey Davis downfall?
mpcamb
(2,855 posts)the 2.4 billion surplus, On board for that?
The next 8 years were Schwarzenegger's, deficit years, dating from before the, excuse me , REPUBLICAN sponsored real estate crisis. What I remember as a non-Californian, also, was that ENRON and Ron Lay were the main sponsors of GWB and the gang of thieves who dragged us into a needless war.
Check the history. Did Schwarzenegger ever run a surplus that he created?
I do not know the answers to your questions. If you know the answers, please state them. You and I are having a failure to communicate momment. Wait a while and someone will come along and set us both straight, OK? Relax a minute, will you? Patience is a virtue.
mpcamb
(2,855 posts)I can only find 2 things that could be construed as questions:
1) "The article states there was nearly a full decade of budget deficit preceding...
the 2.4 billion surplus, On board for that?"
Well, if there's a problem with that take it up with the Chronicle. They wrote the story.
2) "Did Schwarzenegger ever run a surplus that he created?" I'm sure if he had one in his first year (elected following the recall of Davis) beginning October, 2003, or the next year, one could say it was inherited from the previous administration. (If you want to argue that, fuggetaboudit; I'm going to bed after I type this.)
Also, I just referred you back to the article in reply #14. Read up, look up.
Hope this answers your concern about those questions. If you're in love w/ S'negger that's fine. I don't think he was a good Governor, despite the press's infatuation with Hollywood.
And 'moment' only has 2 m's.
JDPriestly
(57,936 posts)Schwarzenegger borrowed and borrowed and borrowed and refused to raise taxes. Since Prop. 13, it is difficult to raise taxes in California. Jerry Brown came in, offered one of two referendums on our ballots to raise our taxes, and got enough public support for the rise that he was able to restore balance in our finances. Jerry Brown also cut spending, but without the higher tax revenues, the state would have not had the kind of success in dealing with its budget difficulties that it has had.
Those with higher incomes got the biggest tax hikes. That is only fair since those with higher incomes also got the higher share of the growth in the productivity nationwide in the last, what, 30 years.
But all of us are paying higher sales taxes.
It is a matter of inspiring the public will to make ends meet on the state level.
California Care is thus far succeeding in our state. California is becoming a leader and a shining example of responsible government and good citizenship. Old fashioned values that Republicans seem to have forgotten.
Schwarzenegger was a nightmare in my opinion. He did not understand the principles of American government, and I am so glad that he is back to pretending in the movies and no longer pretending to be our governor.
ReRe
(10,597 posts)... you restorith my faith. There for a minute I thought I had gone completely over the hill and was headed down the other side. Actually, I thought his personal behavior might be overshadowing his success as a governor (in my mind.)
SoapBox
(18,791 posts)Ya know...his little protest against how "bad" it is here!
I can dream
JDPriestly
(57,936 posts)ReRe
(10,597 posts)MI, MA, and now CA. Maybe he thinks he can hang around CA and rise in politics there?
good luck with that! we're on to him.
itsrobert
(14,157 posts)libdem4life
(13,877 posts)with old nude photos of himself...only thing I could think of was that it was a kind of an honorarium to his wife Maria (Kennedy). Seems she kept the kids together and safe from his philandering. (Just happened to see a gossip rag while standing in a long grocery line. Said she was dating now. She still looks amazing.)
It was more like a Rocky Horror Show. Give me the Zen Governor any day. He's done us proud.
demosincebirth
(12,518 posts)of the electric power grid which cost California billions.
NYC_SKP
(68,644 posts)I still have my button. Somewhere. If we can't have Warren, I'll love me some Brown!
JDPriestly
(57,936 posts)among us. A good governor.
zeemike
(18,998 posts)that is all he would accept from any one person...
And I ran as a delegate on the ballot...in a very red state.
But he would have been a great president.
Betsy Ross
(3,147 posts)And Jerry's first round as Governor was also great.
demosincebirth
(12,518 posts)shebornik
(127 posts)Dollface
(1,590 posts)LeftOfWest
(482 posts)First door knocking I ever did in my life, still believe in him.
bklyncowgirl
(7,960 posts)Seriously, he's done a great job straightening out California. He'd be the perfect candidate against Chris Christie. Real accomplishment as a governor vs the illusion of accomplishment.
Too bad he's not a few years younger, we could use his political savvy and management experience in the White House. I've got an old Jerry Brown button I could pull out of the drawer with my other collection of losers and lost causes.
stopwastingmymoney
(2,028 posts)See my sig line... :-D
procon
(15,805 posts)You couldn't turn on the radio of TV without getting smacked by non-stop, scary rightwing ads, "OMG its the end of life as we know it!" The bill raised taxes for the upper income brackets and also increases our state sales tax... and now there's no argument that it's not working!
Tigress DEM
(7,887 posts)JaneyVee
(19,877 posts)Plucketeer
(12,882 posts)to screw us around. California's the state that ought to secede!
libdem4life
(13,877 posts)enough. Lived decades in both. But together, we're awesome. Moved on from the state of "the fruits and nuts. LOL
passiveporcupine
(8,175 posts)A sales tax is a regressive tax. I understand your government is doing better, but how are the poor doing? Are there enough jobs? Are their wages livable? If not, I can't imagine them coming out better with an increase in sales tax. Of course, in a recession people cut back on purchasing things they don't need...especially the most needy of us, so maybe the sales tax didn't affect the things they did need, like food and medicine?
I live in a state without sales tax and I hope we never have one here. I think all taxes need to be progressive.
Z_California
(650 posts)My sales tax rate, if it's changed at all, is not up more that a quarter point. The top income tax rate went from 10% to 13% (or something along those lines - not exact numbers).
Hell Hath No Fury
(16,327 posts)I am perfectly OK with the sales tax I pay, which is 8.75% here in SF where I live. We Californians -- of all incomes -- like our nice things (parks, roads, rest stops, public art, community colleges, clean environment, etc.) and are willing to pay for them. For many years I paid SF sales taxes, taxes that helped fund City-financed, neighborhood healthcare for our most needy citizens. Due to not having insurance at one point, I myself had to use that taxpayer funded City system -- it literally saved my life and it cost me next to nothing. I thank the citizens of San Francisco for their generosity, and now happily pay my sales tax so others can benefit from such sales tax-funded services.
I get a lot from sales taxes, and I wouldn't have it any other way.
passiveporcupine
(8,175 posts)just regressive taxes. A progressive raise in income taxes would do the same thing, but would level the playing field so that the more you earn the more you pay.
cer7711
(502 posts)Way to go, California!
You got there first, once again. We (the rest of the Union) are right behind ya!!!
Texas & Virginia: soon to be blue . . .
libdem4life
(13,877 posts)Don't know as much about Virginia, other than it seems they just scored a Democratic Trifecta, provided the recount for AG goes well. Things are looking up...from a optimistic point of view.
karadax
(284 posts)When you combine the debts of state and local government California is still close to $1 trillion in the hole.
Pay off the debt or restore the gutted programs with the surplus ? I'm interested to see where this leads.
haele
(12,581 posts)One of the things I learned in both Macro Economics and Financial Management (both taught from a PhD who used to run B of A's foriegn fleet leasing program before his second PhD) is that running a debt that invests when you have enough income to continue to pay the debt is actually considered economically sound. For indivuals, that means things like a mortgage, a car to get you to and from work, and a credit card for emergancies. For businesses, it means loans or leases on operating equipment, raw materials, and facilities. For governments, its pension payments to keep their retirees from costing the public even more by keeping them off the streets and public works that employ people and reduce operational costs in the long run through improved, efficient infrastructure.
As long as you can make headway on your debts, debt itself isn't bad.
In fact, if you work at an incorporated business, your paycheck is a debt "on the books" your employer has to identify and set aside at the beginning of the fiscal year on their ledgers as a payable account for accounting purposes, and the cash to pay you is usually accrued six to eight months in advance by the company.
Now, bad debt is taking your entire month's paycheck and all your credit cards, blowing it all over the weekend in Vegas on slots, hookers and blow - and then taking out a payday loan to pay the mortgage and bills for the month and make that month's credit card payment. Bad debt is a bad investment, accepting either an increase in intrest payments or a decrease in revenue in exchange for a component in your business model.
That's why tax cuts usually end up in the debt side of the ledger, because the benefit of a tax or revenue cut when budgeting is typically offset by a loss in some form of operating or investment capability. Unless that revenue cut is benefiting someone who would take that money they are not paying the overarching governmental entity and spend that money to improve local government and infrastructure, thereby reducing costs to the larger entity, it's just money needed to keep the community safe and thriving, money that can be used to invest in community good and give returns, that is thrown away on people who don't need it.
If you're going to spend it to improve your situation, it's good debt.
If not - it's bad debt.
$1 trillion "in the hole" doesen't hurt California at all so long as it can be paid down without starving the state. And remember, a good 1/2 of that debt is in legislated or annually budgeted payments that are always going to be on the books, like facilities upkeep, salaries and pensions. (Edit Here) In 2010, the annual Gross State Product for California was $1.9 trillion - and it has increased since then. It's expected to be higher this year, because it's already reached within 5% of that number in August.
Being worried about a debt like that is like sitting your family down and telling them:
"We have to really tighten our belts; we're $100K in debt this year; we're going to go bankrupt if we don't cut costs!- While our annual household income is $80K a year between your mom and me, when I added up everything we owe - the total mortgage and principle on our house, the total outstanding on our car, all our taxes and insurance payments for this year, the internet/cable/cell phone bundle and utilities for this year, Little Johnny's music lessons and Little Billy's allowance, it comes to $100K total and we have to pay it off now, or we'll be in big trouble ten years from now when the kids start going to college and maybe I want to retire."
When in reality, all that needs to be paid out for that year is $30K total of the above costs identified, and they still have $50K to spend as they feel best for the family finances - have a reasonable standard of living and maybe put $5K aside pay down the mortgage, maybe pay off the car, or put in various investments.
Or blow that $5K on a family trip to Disneyland over the summer.
Good Debt/Bad Debt.
Haele
DebJ
(7,699 posts)SoapBox
(18,791 posts)silverweb
(16,402 posts)[font color="navy" face="Verdana"]So now can we devote a percentage of that surplus to actually doing something solid and lasting about the situation of the homeless around our state?
truthisfreedom
(23,113 posts)The teabaggers are attempting to prove that government can't work by destroying its ability to collect taxes or spend money.
bemildred
(90,061 posts)nolabels
(13,133 posts)and it looks like it's paying off again!
California Citizens Redistricting Commission
"Fair Representation―Democracy At Work!"
http://wedrawthelines.ca.gov/
Republicans hate us for it
yuiyoshida
(41,763 posts)"Awww...Didn't think so..."
olddad56
(5,732 posts)especially if that one republican was another B grade movie star like Reagan or Arnie.
NYC_SKP
(68,644 posts)CANDO
(2,068 posts)Instead of paying down the accrued debt, you give away the surplus in the form of tax cuts(mostly to the wealthy).
Z_California
(650 posts)How is this possible? The devastating tax increases were supposed to destroy the economy, kill jobs, and make all the rich people move to Texas???
It's sad that I have to do this ---->
Throd
(7,208 posts)KamaAina
(78,249 posts)Medi-Cal (Medicaid), CalWORKS (welfare), and In-Home Supportive Services for seniors and the disabled have all been cut to the bone. So has higher education, especially the community colleges and CSU.
TheDonkey
(8,911 posts)Super majorities in the legislature and a Democratic Governor.
Keep up the good work Sacramento!
Iggo
(47,489 posts)JEFF9K
(1,935 posts)BrotherIvan
(9,126 posts)And we're getting our infrastructure back on track. We desperately need it. Along with much much better public transportation. And high speed rail. And colleges and education. And...
Go CA! We're sorry for Issa and Feinstein but we're trying to make up for it in other ways.
Starry Messenger
(32,342 posts)I can't imagine that the monied techbros are all taking off into the wilds. Obviously people stayed even with the taxes.
I echo the need for CA to help the homelessness ravaging Silicon Valley.
allinthegame
(132 posts)We spent it like kids on Halloween candy overload. Let's hope it doesn't happen this time because it took us years to dig out of the
last mess.