The California Budget - Elephant Poop

So we have a conservative estimated budget deficit of about $25 billion in California.  We have been operating with large deficits for too long.  Governor-elect, Jerry Brown recently held a small press conference to talk about the budget.  With the Bush Tax Cuts being extended at the federal level, California politicians have few options.  Finance Director, Ana Matosantos, clearly stated the one solution that most politicians do not want to go for - cuts.  We have to cut our spending.


Deficit - the amount by which a sum of money falls short of the required amount.  (example: I have $5 but I owe you $100.  My deficit is $95.)


California Taxes Are Already Too High

• Personal income tax - 9.55 percent at $47,055 and 10.55 percent at $1 million.
• Corporate tax rate - 8.84 percent
• Capital gains tax - 9.55 percent
• etc...

If the federal government is arguing that taxes should be kept low during a recession, I don't know how the state would propose to raise taxes without major opposition.  So, what do we do about the budget problems without raising taxes?  We have to address how the state gets money and how it spends it so that we can pay off our debts.  Continued borrowing is not a long term option.  It's just more debt slavery.  If, as a family, you ran on hard times, you would have to cut your spending.  We can't help everyone with our current economic system.


Welfare Issues


We also have a problem with TANF (Temporary Assistance for Needy Families).  It's welfare assistance and although we have 12 percent of the nation's population, we have 36 percent of the recipients.  To me this speaks mountains, but probably not in the way it's typically framed.  Most will look at a statistic like this and say, "oh, screw those people who just live off of government aid."  I would agree to some point, but only for those who exploit the system.  There are two problems here though and it's not that we have public welfare.  Public welfare is a good thing, although I've never taken unemployment.  When my family first came to America, we used food stamps and Medicaid.  Government assistance is needed to balance out the class bias in the system.


Some of the problems are:

1. Exploitation of the welfare system.  We could do a lot better on this.
2. Class warfare, poverty and lack of opportunity.
3. Structural inefficiency, waste and fraud.

So what programs should we cut?  Which ones should we keep but downsize?  How much should we pay public employees?  How much retirement help should we give public employees?  What can we do to save money when we provide public services?  Much change is needed for a sustainable, debt free system in California.