Calif. gov. asks for $4.4B tax hike to end deficit

[natty bumppo 297]

SACRAMENTO (AP) — Gov. Arnold Schwarzenegger has proposed $4.4 billion in tax increases and billions more in spending cuts to close California's worsening budget deficit, declaring: "We must stop the bleeding."

Schwarzenegger on Thursday called for a special session of the state Legislature to address a deficit that has grown to $11.2 billion just six weeks after he signed the budget for the current fiscal year.

He said the state's economic condition has deteriorated significantly since then, with a cratering stock market and the continued decline of the housing industry.

California's budget relies greatly on capital gains taxes, which have dropped precipitously in recent months along with swooning stock prices. Sales and property taxes also have declined.

He said lawmakers will not be able to close the budget gap with cuts alone. He proposed a temporary 1.5% sales tax increase and other "revenue generators."

The link ...

[Trumplestiltskin 5,791]

When you have more going out than coming in - cutting spending and raising tax increases are pretty much inevitable.

[Ban Hammer 13,636]

add that season to the rest.

fire, earthquake, drought, flood, riot, and tax.

[natty bumppo 297]

When you have more going out than coming in - cutting spending and raising tax increases are pretty much inevitable.

spending cut = more unemployment?

[Trumplestiltskin 5,791]

Pretty much. This has already happened I think - Arnie has already sacked a bunch of government workers and put others on part time hours.

Again inevitable.

[natty bumppo 297]

better go for a bigger tax hike ... keep people working

[Trumplestiltskin 5,791]

I think they're doing all of it (tax cuts, spending cuts, redundancies in government jobs). Cutting back monstrous bureaucracies might provide better taxpayer value for money in the long term.

I haven't lived there in a couple of years so I really can't say what the consensus is on Schwarzenegger's job performance - if he's mismanaging the State economy or anything like that. I don't think he's particularly disliked over there - I could be wrong of course.

[HAL 9000 96]

Wow another Republican raising taxes? How can this be?????????

[Trumplestiltskin 5,791]

When the books don't add up - you have to do these things.

The trick is to avoid getting into the pickle in the first place...

[Peikko 1,575]

He's trying to be fiscally responsible. It's not an easy job. Personally, I support what he is trying to do - although obviously there are going to be casualties that I do not like. What would be more worrying would be if he was doing that, while having an opulent lifestyle at taxpayer expense. I don't see that. Of course, like many before him he has to cope with problems created by his predecessors.