Governor Newsom’s revised budget includes deeper cuts to vital programs and services that will negatively impact the lives of families with low incomes, foster youth, immigrant communities, people with disabilities, and many more Californians. Nearly 90% of the governor’s proposals to close the budget shortfall come from spending-related actions, including cuts and delays. In contrast, raising additional revenue makes up less than 4% and withdrawing from the rainy day fund makes up less than 6% of his proposals.
State leaders could prevent the most disastrous cuts by further tapping into the state’s rainy day fund and permanently reducing tax breaks for profitable corporations. California is slated to spend billions of dollars on tax breaks this year — despite the budget shortfall — with some of the most costly breaks primarily benefiting highly profitable corporations at a time when corporate profits have reached record highs. These tax breaks take billions of dollars out of the state budget that would be better spent supporting the health and well-being of Californians.
As policymakers navigate a challenging budget year and work toward a California for all, it’s crucial that fair taxation and increasing revenues be part of the solution. By tapping into California’s great wealth and reallocating resources to benefit all Californians, policymakers can chart a path forward where economic opportunity, affordable housing, accessible health care, quality education, child care, and other basic needs are within reach for every Californian.
