Sunday, May 13, 2012

Will Californians Do the Greek?

California's budget deficit has swelled to a projected $16 billion — much larger than had been predicted just months ago — and will force severe cuts to schools and public safety if voters fail to approve tax increases in November, Gov. Jerry Brown said Saturday.

Brown said the shortfall grew from $9.2 billion in January in part because tax collections have not come in as high as expected and the economy isn't growing as fast as hoped for.

Will Californians prove to be saps and vote for higher taxes or will they do the Greek thing and vote against higher taxes? We will find out in November.

One point Californians should keep in mind, even if taxes are raised, it won't be enough to solve long term budget problems, given the state entitlement programs. Further the oppressive taxes and regulations in the state are causing more and more businesses  to flee the state, cutting the tax base on a daily basis.


  1. As long as they do not recognize that income tax is theft, they will not recognize blackmail or extortion when threatened with budget cuts for salaries and benefits of public school and public safety "services".

    The only ones that do are smart enough to leave.

  2. One of the biggest problems in California is the public pension obligations and the insanely generous union contracts. The only way out of those things for the state is to declare bankruptcy.

  3. I hear that there will be two proposed tax increases: the first is raising taxes on those making over $250k, and the second is raising the state sales tax. Voters will have no problem taxing the rich, but they will be less likely to increase their own share. I'd say that the passage of increased taxation is dependent on whether or not the two tax increases are to be voted on together or independently. If tax raises are approved and Obama gets re-elected, then get ready for the largest mass exodus of business that California has ever seen.

  4. A question for EPJ readers: would the federal government ever "bail out" California if it heads for bankruptcy? After all, it is one of the largest economies in the world. If California was bailed out, what do you think would be the response of other states?