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California expects $26 billion windfall, despite coronavirus

Original post made on Nov 29, 2020

The good news: The recession California officials predicted in the early months of the coronavirus pandemic has not been as dire as they thought it would be. The bad news: The $26 billion windfall reveals a
stark economic divide.

Read the full story here Web Link posted Sunday, November 29, 2020, 8:57 AM

Comments (6)

52 people like this
Posted by Lee Forrest
a resident of Crescent Park
on Nov 29, 2020 at 9:32 am

Lee Forrest is a registered user.

> "...the state will have a $26 billion windfall heading into the next fiscal year"

> "California is heading toward a $17 billion deficit in three years because expenses are growing faster than revenue. That leaves lawmakers with two politically unappealing choices: make ongoing spending cuts or raise taxes."

^ So set aside roughly $18 Billion to cover the anticipated 3-year deficit of $17 Billion.

This turn leaves approximately $8 Billion which could then be allocated (in equal amounts) to ALL tax-paying citizens of CA in the form of an economic stimulus package.

No need to raise taxes...just trim some fat as operating a state budget is no different than effectively managing one's own expenses & personal finances.

It's also called living within one's means.

3 people like this
Posted by Losing Patience
a resident of Another Palo Alto neighborhood
on Nov 29, 2020 at 10:52 am

Losing Patience is a registered user.

[Post removed.]

10 people like this
Posted by The Voice of Palo Alto
a resident of Crescent Park
on Nov 29, 2020 at 2:22 pm

The Voice of Palo Alto is a registered user.

[Post removed.]

2 people like this
Posted by PeopleMatter
a resident of Midtown
on Nov 29, 2020 at 6:15 pm

PeopleMatter is a registered user.

CalMatters is a Republican leaning media outlet.

Yes. California is the 5th largest economy in the World because there are massive tax breaks for the rich Co's who gladly take up residence here and who employ low-paid workers, with non arbitration rules with few or no benefits.. App delivery services Uber, Door Dash etc pooled $135 million dollars to defeat Prop 22. The most money spent to buy votes through untrue overly, emotionally charged TV/Radio/YouTube adds and mailers to defeat the Calif state wide measure. This sum far exceeded San Francisco's PG&E spent to defeat the Calif prop. to break up their Northern California energy delivery service. This, their after PG&E's shameful zero tolerance residential shut offs, price gauging, rolling black-outs and Enron debacle. I believe Palo Alto is one of a handful of Northern Calif cities to have its own energy utility department .

4 people like this
Posted by Vladd
a resident of Midtown
on Nov 30, 2020 at 7:52 am

Vladd is a registered user.

PeopleMatter: you are just demonstrating how 'alternative facts' can come from both sides

CalMatters is funded by the state of California and is a nonprofit to better inform the public. You can find their form 990s. The main potential bias they have (and I sometimes get the feeling reading their articles) is being pro-[state]-govt but they tend to be level headed

Please stop making things up when you don't like the information. it's not to say there are no opportunities for revenue generation or that no companies are profiting well, but clearly the income tax increases coupled with the booming stock market have been generating huge windfalls for the state that has pleasantly surprised lawmakers since they hiked up rates to 13.3%

The main issue is this ever increasing reliance on the high end and the stock market in particular. When the stock market turns south the state will be screwed. Either the "rainy day" fund needs to be seriously built up to have a massive endowment and cushion (hard to imagine with politicians), or find a way to restructure taxes to diversify revenue sources. A responsible prop 13 reform could slowly unroll prop 13 for the well-to-do in conjunction with income tax reductions. Politically and PR wise though this might never happen

Like this comment
Posted by Redistribute.
a resident of Another Palo Alto neighborhood
on Nov 30, 2020 at 2:49 pm

Redistribute. is a registered user.

I like the idea to set some of this money aside to cover a looming deficit. However, the rest should be redistributed to people who will spend it. Low income people spend a much higher percentage of their income, so they will immediately spend and give the economy a lift that will benefit us all. The people who are really suffering from job loss, fires, illness now need that money. They will spend it on essentials--food, housing clothing. Help them, and help us all.

Be well, friends.

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