Posted 12/10/2023, 6:24:00 PM
California Faces $68 Billion Budget Deficit After Overspending During Boom Years
- California facing a $68 billion budget deficit this year, a reversal from a predicted $100 billion surplus just 2 years ago
- Deficit due to overspending and over-reliance on the top 1% and 0.1% of earners for tax revenue
- Top earners provide 50% of state income tax revenue, but their earnings fluctuate with the economy
- Spending commitments are rigid and hard to cut, while tax revenues swing wildly
- Lesson is you can't fund social democracy just by taxing the rich at high rates, need broader and less progressive taxes like European countries do