California Gov. Gavin Newsom has to reckon with a multibillion dollar budget deficit in the state. (Justin Sullivan/Getty Images)
In January, Newsom estimated the shortfall to be $38 billion, even though the LAO estimated it would be closer to $45 billion. Last Friday, Newsom unveiled his revised budget, projecting the same as the LAO's billion-dollar deficit through 2024-25 and an additional $28.4 billion in 2025-26, bringing Newsom's revision to the nonpartisan LAO's estimate of $73.3 billion.
Newsom also announced sweeping cuts to more than 10,000 open government jobs, an 8% slash to "state operations," and the state's progressive climate programs are also getting the boot.
"He is eliminating positions that don't have people in them, so it's budgeted spending that's not going to be spent," Niello said. "I would put that under the category of a gimmick. But beyond that, in terms of real budget solutions, we had three or four years prior to the current budget year of tremendous and unsustainable surpluses, even by the governor's own account."
In 2022, Newsom signed a $301 billion budget into law and boasted a $97 billion surplus. The budget, nearly triple what it was the prior fiscal year, included billions of dollars for climate change initiatives, homelessness and education. But two years later, the deficit ballooned.
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An aerial view of the California State Capitol on Feb. 1, 2023 in Sacramento, California. (Justin Sullivan/Justin Sullivan)
California saw its first-ever population decline in 2020, when the state imposed rigid lockdowns during the COVID-19 pandemic. From January 2020 to July 2022, the state lost well over half a million people, with the number of residents leaving surpassing those moving in by almost 700,000.
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Meanwhile, Newsom said Friday that "this is just a reminder of the totality of challenges in the past on the basis of the volatility of our tax structure, the benefits of a progressive tax system during good years, the challenges during years when things are contracting."
Jamie Joseph is a writer who covers politics. She leads Fox News Digital coverage of the Senate.
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