Beginning today, the effects of California’s fiscal meltdown will become ever uglier, with hefty new cuts likely in education, health, welfare and almost every other state program. As always, the biggest victims will be children, the poor, the old, the sick and the future.
By the latest count the state faces a $21 billion budget gap in the coming 18 months and more deficits in the years thereafter. We’ll get some of the grim details from the governor’s state of the state and his budget proposals later this week.
But it doesn’t have to be this way – it’s not written in stone, and never was. We – the legislature, a generation of governors, the voters – have made the choices that got us here, and it wouldn’t be all that hard to work our way out of it, were we only willing.
Begin with a few simple facts:
Begin with a few simple facts:
*Because of the accretion of loopholes and other tax breaks enacted in the past three decades, California corporations are paying a much smaller share of their profits in corporate taxes now than they did in 1981. If the share had been the same in 2006 as it was in 1981, according to CBP, the California Budget Project, corporate tax collections would have been $8.4 billion higher. Our corporate tax rates are high, but the tax code is such a Swiss cheese of breaks that the official rates tell a misleading story.
*All, told, tax cuts enacted since 1993 cost the state an estimated $11 billion in 2008-9.
*Because a much larger share of the state’s economic