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From Bad To Worse: California Faces Yet Another Round of Cuts

From Bad To Worse: California Faces Yet Another Round of Cuts
David M Greenwald.jpgby David M. Greenwald
Editor
California Progress Report

Perhaps we thought this thing was about to get better. The Stock Market had its best week of the year. California legislators just less a month ago came to a budget agreement.

But just when we thought we had dodged the worst of it, the next shoe has fallen. The state Legislative Analyst Mac Taylor announced that due to the falling economy and declining tax revenue, state revenues will be another $8 billion lower than expect next fiscal year.

Said Mr. Taylor:

"Unfortunately, the state's economic and revenue outlook continues to deteriorate."

Moreover, Mr. Taylor's report said he is "extremely reluctant to recommend that the state raise any more tax rates." That would mean the entire budget deficit would have to be made up through spending cuts.

Friday was already supposed to be Pink Friday, in protest of the cuts to education. Perhaps Pink Friday was not descriptive enough. Perhaps for California is should be called Black Friday.

A record number of teachers--26,000 according to the Office of the Secretary of Public Instruction Jack O'Connell--were given pink slips or potential layoff notices on Friday, the last business day before the annual March 15 statutory deadline for districts to issue layoff notices for the coming school year.

“School districts up and down this state are sending out pink slips to tens of thousands of hard-working, dedicated teachers, administrators, and school staff. Cuts of this magnitude will have devastating effects in our classrooms across the state.

Before the current cuts were enacted, California already ranked 47th in the nation in per-pupil spending. These current cuts are sure to push us further down the scale. Our future depends on our ability to prepare the next generation for success in the hyper-competitive global economy. The budget crisis and the teacher layoffs we are now witnessing makes that challenge much, much harder. In order to deliver the quality education our students need we must get off this budget roller coaster and find a stable, long-term solution to education funding. Our future depends on it.”

And yet we now know that these 26,000 cuts are probably a best case scenario as the fiscal situation continues to deteriorate. Here we are just two months away from the May elections that were needed to balance the budget agreement from February and now that budget agreement is already out of date. What more can be cut from the state budget? How much more of a hit can education afford to take? Where else can we find money without trying to raise revenue?

Senate Leader Darrel Steinberg:

“We will solve the challenge outlined this morning by the Legislative Analyst with the same intensity that we solved the $42 billion problem in February. It should come as no surprise that the Nation’s economic downturn continues to severely impact California’s budget – retail sales continue to decline and unemployment continues to rise and American families lost $5.1 TRILLION in the last 3 months of 2008.

Like thousands of businesses and millions of families, state government has less money to spend. But moms and dads will continue to get their kids off to school. Sick people will need an emergency room. There will be fires to put out. Criminals to prosecute. And elderly people to care for. Fortunately, the action we took in February makes what we face more manageable.”

But how much more manageable? What is left to cut.

Hilary McLean, spokeswoman for state Superintendent of Public Instruction Jack O'Connell said yesterday that schools were already counting on the federal funds for a more immediate purpose, easing billions in cuts necessitated by last month's budget deal. Even before the new round of numbers, public schools were expected to take a $5 billion hit in program cuts in the next budget. Now that is going to get much worse.

"To say that's suddenly going to be used to backfill further cuts would be a major blow to schools that already are on their knees with the cuts that have been made."

Posted on March 14, 2009

Comments

I told you more taxes would not work.
People are losing their jobs, homes and health insurance and CA has the BIGGEST tax increase of any state in the history of the nation. Obama pushed for tax payers to get cash and CA raised taxes to steal it. CA residents will never see their money infact they have less to stimulate the economy.
How long until our leaders (HA) come looking to raise taxes again? 3 months, 6 months.

Posted by: Jeff at March 14, 2009 10:05 AM

"I told you more taxes would not work."

You do recognize that the tax increase have yet to take effect right?

Posted by: David Greenwald at March 14, 2009 10:12 AM

The effect of higher taxes is happening. Spending is down, people are saving more. Many know they will have less money in the future.
A Tax Revolt protest in Fullerton last week had 10-15K people.

Posted by: Jeff at March 14, 2009 11:29 AM

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