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The size of our state government doubled in eight years. When the high-tech boom was hot, tax revenues were extraordinary. Our state legislators made long term financial commitments as if the boom would last forever. It did not.
Our legislators have stubbornly refused to roll back spending in any meaningful way, choosing instead to cut funding in very visible and painful ways; close parks, fire teachers, etc.
California's legislature seems to have decided that the $100 Billion budgets are permanent and essential. The responsibility for balancing the state budget will fall squarely upon the shoulders of the top 5% of earners. The question remains; How many large employers will move their companies to more tax friendly venues? Nevada, Arizona and Texas are anticipating an exodus of businesses from California.
I read an article somewhere that if California lost just 10% of it's top 100 taxpayers it would be a financial calamity. Scary thought.
So... our guess is as good as mine. Can California dig itself out? I know it's possible, but I'm not certain we have the political will.
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My work here is nearly finished.
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