California Announces Larger Budget Deficit Than Expected
Summary from the AllSides News Team
On Friday, California Gov. Gavin Newsom (D) revealed a revised $306.5 billion budget proposal and announced that the state’s budget deficit had grown to $31.5 billion.
The Details: The deficit has grown about $9 billion from the initial $22.5 projection announced in January, which totaled nearly $297 billion. While not projecting a recession, the updated budget believes a moderate recession could reduce personal income tax revenues by $40 billion in 2023-2024.
For Context: Unlike the federal government, California must pass a balanced budget every year, where revenues and expenditures even out. Newsom continued to not endorse any reparations plans.
Key Quotes: Newsom said it is not “the right time” for tax hikes, and stressed a sound fiscal footing. “This was not an easy budget, but I hope you see we will try to do our best to hold the line and take care of the most vulnerable and most needy, but still maintain prudence,” he said. California Republican Party chairwoman Jessica Millan said the deficit “should be a wakeup call to all Democrats that after years of increased spending, they should have better results to point to.”
How The Media Covered It: The three cited sources analyzed the deficit differently. The Hill offered many examples of specific spending amounts. Washington Free Beacon highlighted Republican frustrations and the expatriation of many wealthy Californians to other states. The Washington Post said Newsom is not cutting spending on any of “the state’s most important programs.”
Featured Coverage of this Story
From the Left
Governor says California's budget deficit has grown to nearly $32 billion
California’s budget deficit has soared to nearly $32 billion, Gov. Gavin Newsom said Friday as he announced a plan that would cover the shortfall this year while potentially leaving the state with multibillion-dollar deficits in the future.
Newsom, a Democrat in his second term, proposed no major tax increases for individuals or spending cuts across the state’s most important programs, including those impacting public education, health care and homelessness. His plan would cut spending by about $10.6 billion — about $1 billion more than what he proposed in January — while covering...
From the Center
Newsom announces California budget deficit much larger than previously expected
California Gov. Gavin Newsom (D) unveiled a revised $306.5 billion budget proposal on Friday, while announcing the state’s budget deficit had grown to $31.5 billion.
This shortfall is about $9 billion more than the $22.5 billion gap he projected in his initial January budget proposal, which totaled about $297 billion.
“We are walking into a budget where we need to maintain our prudence, and we need to prepare not just for the short term but the medium and long term,” Newsom said at a Friday press conference, where he presented the revised proposal.
Recognizing the current environment of...
From the Right
California Budget Hole Even Deeper Than Predicted, Newsom Says
California's budget deficit has swelled by nearly $10 billion so far this year, Gov. Gavin Newsom (D.) said Friday as he unveiled a revised $306 billion state budget proposal.
The projected shortfall has reached almost $31.5 billion, Newsom reported, up from $22.5 billion when he first proposed the budget in January. Newsom warned that even a mild economic recession could bring an additional $40 billion hit. He blamed the state's progressive tax system, which leans heavily on the richest Californians, for the dramatic decline in fortunes since a year ago,...
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