Newsom’s Latest Binge

“It is our hope that all schools will be able to physically open for five days per week in the fall but local conditions will determine whether that is possible.” – Cecily Myart-Cruz, President, United Teachers of Los Angeles (UTLA Update 5/14/2021)

It’s impossible to know what “local conditions” are going to look like when kids go back to school this Fall, but two things are certain: Whatever the United Teachers of Los Angeles want, the United Teachers of Los Angeles are going to get, and to the extent “local conditions” involves money, there’s going to be plenty of it.

California’s budget bonanza, just announced last week, capitalizes on conditions unique to California that in retrospect are obvious. The COVID lockdown may have decimated California’s working families and small businesses, but the explosion in online activity delivered stupendous windfalls to California’s high tech industry. In California’s top heavy income tax model, the more money California’s super rich make, the more money pours into the state treasury. And pour it did. Quoting from the May Revision of California’s 2021-22 state budget:

“Compared to a projected budget deficit of $54 billion a year ago, the state now has a projected $75.7 billion surplus. Combined with over $25 billion in federal relief, this supports a $100 billion California Comeback Plan—a once-in-a-lifetime opportunity.”

This hundred billion dollar binge is a welcome distraction for the embattled Governor Newsom, who faces a recall election later this year. And of course, spreading an extra $100 […] Read More