Wed. Jul 24th, 2024

By Donna Westfall – January 5, 2023

Do you remember California boasting about having so much money in their kitty? In May ’22, Gov. Newsom said we were flush with cash. How much? An unprecedented $97.5 billion surplus.

Guess what?. They have bills of over $454+ billion with only $170+ billion available to pay those bills. That’s a $284 billion difference. (ref:

What happened to that $97.5 surplus?

They say a large chunk went towards education and other spending categories. How large a chunk? About $50 billion. Out of the remainder, some would be given back to taxpayers known as the Middle Class Tax Refund.

Then there’s the $400 “gas relief” payments to Californians who own a vehicle, totaling $11.5 billion in cash back. We received a debit card good for $700. Whoopee! Guess we better spend it fast before they want it back. But then I wonder, if we have 2 vehicles, how did they calculate that gas relief payment? $400 per vehicle? I don’t know. Otherwise wouldn’t the debit card be for $800.

The answer is that the Middle Class Tax Refund is separate from the “gas relief” payment as the first is from the Franchise Tax Board and the second is from the State Controller’s Office.

If you want to apply for the “gas relief” there’s a whole bunch of paperwork and rigamarole to go through.

Personally, I’d rather they cut the gas taxes, but they’re predominantly Democrats and too stubborn to cut gas taxes. Then again, let’s not complain too much about the Democrats when our own local Republican Central Committee endorsed voting against repealing the City and County sales taxes, and our voting public went along with keeping it in place.

As of December 23rd, more than 29 million California taxpayers and their dependents have benefited from the Middle Class Tax Relief payments, according to the Franchise Tax Board. The vast majority of debit cards will be issued by January 14, 2023.

But with nearly $117 billion in unfunded pension benefits and $121 billion in unfunded retiree health care benefits how do you suppose our state government will solve this insolvency problem?

Do you suppose they’ll cut spending? Doubtful. Incompetence reigns supreme.

But wait, there’s more to learn.

During the heyday of “budget surplus” Newsom and the Legislature enacted a $300 billion budget which included universal health care by extending it to all undocumented workers. And let’s not forget he’s invited every woman out of state wanting an abortion to come to our Golden State to get it at taxpayer expense if necessary.

Due to lower revenue estimates, Budget Analyst Gabe Patek, takes into account the looming recession that would put those budget estimates at $30 – 50 billion below their expectations.

Patek is recommending the Legislature take a very conservative approach to budgeting and not rely on the State’s reserves. How much are in the State’s reserves?

From the Legislative Analyst Office:

“This consists of:  ” …2022‑23 will end with nearly $28 billion in total reserves.(1) $23.3 billion in the Budget Stabilization Account; (2) $3.5 billion in the Special Fund for Economic Uncertainties (SFEU); and (3) $900 million in the Safety Net Reserve, which is available for spending on the state’s safety net programs, like Medi‑Cal. Oct 12, 2022″

This doesn’t seem nearly enough.

Back to insolvency. I still can’t figure out how the numbers can vary so much. $284 billion or $41 billion or $25 billion? Depending upon the date and who’s doing the talking, it varies. When we’re in the billions of dollars, that get’s to be dramatic as well as worrisome.

Homelessness, drought, wildfires. Horrible public education. High Speed Rail spending so over budget with no end in sight. High cost of living. Shrinking population. High Taxes. Welfare. The problems with no solutions. Locally we’re in the middle of rain and wind like it’s never going to stop, but that’s not happening in so many California cities almost out of water.

Bringing back the “Golden State” to it’s former glory days is going to be a task for people with vision, intelligence, and fiscal knowledge. I hope to see it happening in my lifetime. Not a chance it will happen in 2023.

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