Blue States Blues: California Gov. Newsom Underestimated State’s Deficit by $7 Billion

California Gov. According to the report by the nonpartisan Legislative Analyst’s Office last week, Gavin Newsom’s projected deficit budget of $22.5 billion could have been underestimated by $7 billion.

Fox News Notes, Newsom told Californians last month to expect a $22.5 billion deficit in the coming fiscal year — after a surplus of $100 billion, driven in part by federal grants for coronavirus relief spending.

According to the LAO, the deficit could even be worse. It states in a new report (emphasis added),:

Due to a deteriorating revenue picture relative to expectations from June 2022, both our office and the administration anticipate the state faces a budget problem in 2023‑24. The Governor’s budget revenue estimates may seem reasonable but they are likely to be too high. In particular, using recent revenue collections and economic data, we estimate there is a two‑in‑three chance that state revenues will be lower than the Governor’s budget estimates for 2022‑23 and 2023‑24. Our best estimate is that revenues for these two years will be roughly $10 billion lower—implying a larger budget problem by about $7 billion. (There are many other factors that will also affect the budget problem’s actual size. That said, after adjusting for inflation, anticipated revenues for 2023‑24 still would remain about 20 percent higher than before the pandemic.

California’s budget is volatile due to its dependence on taxes on the highest-earning citizens. Their income changes with the stock market.

Newsom and state Democrats Use the surplus to spend on various left-wing priorities, including health insurance for all residents — including those in the country illegally.

Joel B. Pollak serves as Senior Editor at Large at Breitbart and is the host of Breitbart News Sunday Sirius XM Patriot Sunday evenings, 7 p.m.-10 p.m. ET (4 p.m.- 7 p.m. PST). The author of the new biography is he. Rhoda: ‘Comrade Kadalie, You Are Out of Order’. He is also author of the e-book. The 2020 U.S. Presidential Election is neither free nor fair. He is the 2018 Robert Novak Journalism Alumni Fellowship winner. Follow him on Twitter @ @joelpollak.