Who Will Bear the Brunt of California’s Budget? Low-Income Families…

California’s most vulnerable residents – children, seniors and low-wage working families – will bear the brunt of a budget that may be fiscally sound but further reduces opportunity for future prosperity.

As we near the beginning of California’s 2011-2012 fiscal year, our state still does not have a budget. But that’s not the surprising part of this year’s budget battle. The real surprise is Governor Jerry Brown’s bold move to veto a budget proposed by Democrats earlier this year that relied on accounting maneuvers to balance the budget. This move demonstrates the governor’s agenda—an agenda with the goal of freeing California from the shackles of accounting gimmicks and creating a budget that reflects the state’s financial reality.

Partisan politics continues in Sacramento, to the detriment of California’s low-wage workers and families. Democratic legislators went back to the drawing board to solve a $10 billion shortfall and were promptly confronted with a lack of Republican support for maintaining the taxes needed to generate the revenue for a balanced budget. Governor Brown had been hoping to extend tax and fee increases that are currently set to expire tomorrow, June 30. This extension failed to receive the required two-thirds vote from the legislature to pass. Without this continued tax revenue, California will have to face even deeper cuts to schools and public service programs and low-wage Californians, like those we serve at EARN, will encounter even more hardship.

Programs serving lower-income Californians have borne the brunt of the spending reductions in the past years, from reductions in Medi-Cal to severe cuts to the California public school system. This year, low-income Californians will be asked to tighten their belts another notch and bear an additional surge of cuts.

Governor Brown is trying to force legislators to face the music and prompt them to make a choice. Legislators must choose between the two options that will result in a balanced budget for California. They must either opt to increase revenue through maintaining current levels of taxation or they must propose across-the-board cuts to publicly funded services, programs, and employees.

On June 27, the legislators announced a new proposed budget for the 2011-2012 fiscal year that does not include these tax increases. The new budget proposal, which according to Governor Brown is a “very good plan,” will assume an additional $4 billion in revenue and cut over $12 billion across the board, including $650 million from both the California State University and University of California systems. If the assumed $4 billion in revenue does not materialize, the K-12 public school system will once again come under the chopping block to make up the difference. As we await the details of the new proposal, one thing is for sure. California is tired of gimmicks, deficits, and the deterioration of programs serving our most needy Californians. We need change; we need policies that will put us on the right track to a healthy California that supports our residents instead of stripping them of opportunities for prosperity. 

Until next week,

Javier Oliver
Public Policy Fellow

Photo credit: payitno