As higher expenses competed for fewer dollars, per-pupil funding of the state’s public schools dropped to 35th nationally in 2009-2010 from 22nd in 2001-2002. Californians have endured recurring budget deficits throughout the past decade and now face the country’s highest debt and Standard & Poor’s lowest credit rating for a U.S. state.
“The top 1 per cent of earners in California accounts for 20 per cent of income but pays 41 per cent of income taxes,” he said. “After Prop 30 the top 1 per cent would pay something north of 50 per cent of income taxes. What we have done is accelerate the volatility of the tax base in California. What if there’s a downturn?”
Don't think for a second that California's chronic deficits are caused by low taxes. Even before last Tuesday's tax hikes, California had the most progressive income tax system in the nation, with seven brackets, and the second-highest top marginal rate. Now it has the nation's highest top marginal rate and the nation's highest sales tax. And the budget still isn't balanced. -Conn Carroll, "Can conservatives prevent the U.S. from becoming California?"
Liberal, Government, Incompetence, Financial, Oops
State environmental leaders this week hailed California's first auction of carbon emissions credits a huge success. But budget writers are hardly thrilled. A low price for credits and minimal demand for future offsets suggest California will see a mere fraction of the $1 billion that Gov. Jerry Brown and lawmakers estimated the state would receive this fiscal year. If demand remains similar in two forthcoming auctions, the state would generate only about $140 million, the nonpartisan Legislative Analyst's Office estimated Wednesday.
CHICAGO (Reuters) - Standard & Poor's Ratings Services on Monday affirmed California's A-minus general obligation rating with a negative outlook, but warned any ratings downgrade would likely be related to liquidity problems.
Liberal, Incompetence, Financial
ha_jchiang48630.JPGCalifornia will run out of cash by early March if the state does not take swift action to find $3.3 billion through payment delays and borrowing, according to a letter state Controller John Chiang sent to state lawmakers today.
Liberal, Tax, Oops
Compared to last year, State tax collections for February shriveled by $1.2 billion or 22%. The deterioration is more than double the shocking $535 million reported decline for last month. The cumulative fiscal year decline is $6.1 billion or down 11% versus this period in 2011.