California’s Deficit Is $222 Billion and the State is $1.6 Trillion in Debt
https://mishtalk.com/economics/californias-deficit-is-222-billion-and-the-state-is-1-6-trillion-in-debt/Governor Gavin Newsom bragged of a surplus, but California is seriously underwater. The next recession will hit the state extremely hard.
Golden State Budget Fantasy
The City Journal founder Ed Ring comments on the Golden State Budget Fantasy
While finalizing the upcoming fiscal year’s state budget back in May 2022, California governor Gavin Newsom boasted of an extraordinary projected surplus: $97 billion. The governor immediately collaborated with an enthusiastic state legislature to spend it all. Of course, new spending on new programs and benefits tends to become permanent.
This has happened repeatedly in California. Between fiscal year 2012–13 and fiscal year 2022–23 (the year with the projected $97 billion surplus), per capita general-fund spending doubled, from just over $3,000 per resident to just under $6,000. (All figures are in 2022 inflation-adjusted dollars.)
The State Office of Legislative Analyst’s latest report projects a $73 billion dollar deficit for the next fiscal year. It won’t be easy to paper over this debt, but the state may use its opaque accounting system to hide the ball.
California is underwater. They have $222 billion deficit and $1.6 trillion in debt. That is a lot for a state.
