California and liberals alike are bragging about huge "EXPECTED" budget surpluses in the next two years. Look closer and see a mirage.
First, their PROJECTS are based on the economy getting better and the tax revenues on the increase on the tax increase on the "rich." First, State governments (red and blue alike) are notorious for over-estimating the better economy effect and the understating many increased costs. Medicaid is jumping by leaps and bounds in CA because of Obamacare (and everywhere). CA has a large poverty level Latino class, they are easily getting into medicaid because of Obamacare. Since CA is a sanctuary State you can guarantee many new medicaid enrollees are illegals! This increase alone is going to erase any surplus they expect, heck it will probably bring a $10 billion deficit. Second, CA's tax increase on the rich puts the combine (Fed and State) income tax above 50%. I know many executives in my company (our US HQ ia LA) have transferred already and they do meetings via video conferencing. The rich are leaving and doing it in droves and being replace with peasants from the 3rd world. They WILL miss those optimissitc tax increase expectations BY A LOT, I guarantee it.
Second, they have the surplus (at least on the hot books) because they are kicking the can down the road. See IL, we did it for decades and the can just hit a wall and bounced back, no where to kick it anymore. CA is deciding not to pay certain bills, such as the BLOATED and HIGHWAY Robbery teacher pension funds - those commitments aren't going away or getting reduced in kiss the ass union run democratic party. They will have to pay them. See below. This shortfall EASILY eats away at the expected surplus.
Come the end of the year, CA will be broke again, taking loans and saying, "Wow I thought we were supposed to have a surplus." Must have been those evil racist Republican's fault, let's tax the rich again to 60% combined state and Fed. Viva the Revolucion!!!
First, their PROJECTS are based on the economy getting better and the tax revenues on the increase on the tax increase on the "rich." First, State governments (red and blue alike) are notorious for over-estimating the better economy effect and the understating many increased costs. Medicaid is jumping by leaps and bounds in CA because of Obamacare (and everywhere). CA has a large poverty level Latino class, they are easily getting into medicaid because of Obamacare. Since CA is a sanctuary State you can guarantee many new medicaid enrollees are illegals! This increase alone is going to erase any surplus they expect, heck it will probably bring a $10 billion deficit. Second, CA's tax increase on the rich puts the combine (Fed and State) income tax above 50%. I know many executives in my company (our US HQ ia LA) have transferred already and they do meetings via video conferencing. The rich are leaving and doing it in droves and being replace with peasants from the 3rd world. They WILL miss those optimissitc tax increase expectations BY A LOT, I guarantee it.
Second, they have the surplus (at least on the hot books) because they are kicking the can down the road. See IL, we did it for decades and the can just hit a wall and bounced back, no where to kick it anymore. CA is deciding not to pay certain bills, such as the BLOATED and HIGHWAY Robbery teacher pension funds - those commitments aren't going away or getting reduced in kiss the ass union run democratic party. They will have to pay them. See below. This shortfall EASILY eats away at the expected surplus.
Come the end of the year, CA will be broke again, taking loans and saying, "Wow I thought we were supposed to have a surplus." Must have been those evil racist Republican's fault, let's tax the rich again to 60% combined state and Fed. Viva the Revolucion!!!
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