This past Tuesday, California Gov. Gavin Newsom expressed that he now had plans to slash billions of dollars in investments that had been earmarked for climate change programs and delay other types of funding for major programs amid a state budget deficit of close to $22.5 billion.
Newsom recently revealed the $297 billion budget plan fro the state in the fiscal year 2023-24, in which the Democrat governor reportedly explained that he made sure to preserve California’s reserves, warning about possible nationwide recession.
“That makes us very mindful of the uncertainty of this next calendar year — and as a consequence of that — we’re not touching the reserves because we have a wait-and-see approach to this budget,” stated Newsom, as reported by The Los Angeles Times.
Cuts to the budget seemed to include roughly $6 billion which has been pulled away from a number of programs slated to try and boost zero-emission cars throughout low-income neighborhoods and replace greenhouse gas cars such as airplanes, rain lines, delivery trucks, and many others, stated a KCRA report.
It was highlighted by Politico that the governor has also proposed an option that will delay the spending of multiple billions of dollars for public universities, transit, behavioral health, building decarbonization, and watersheds.
The California Republican Party stated to the KCRA that Newsom has outright failed to deal with various issues such as homelessness and wildfires despite an insane level of spending.
“Now with a massive budget shortfall projected, it’s time for Gavin Newsom to finally get serious about smarter spending to resolve the many issues that are plaguing our state and driving long-time residents away,” explained Jessica Millan Patterson, the party Chairwoman, in a release.
Newsom and his administration blamed the drop in revenue for the state on increased inflation levels, a massively unpredictable stock market, and spiked interest rates coming from the Federal Reserve.
However, the governor explained that he was quite confident that California would be in a much better place “than most other states to weather what’s to come, to weather a recession.”
California recently highlighted a possible deficit after having reported a budget surplus for the past few years.
The Legislative Analyst’s Office recently submitted a report at the end of last year which highlighted a possible $25 billion deficit, which they claim is stemming from “lower revenue estimates.”
A report from Fox News explained that a number of analyst officials have stated that the state is dealing with the projected deficit mostly because the revenue from taxes sits at about $41 billion less than they previously expected.
“Spurred by pandemic-related federal stimulus, the U.S. economy entered a period of rapid expansion in the summer of 2020 that extended through 2021,” highlighted the LAO. “Over the last year, however, evidence has mounted that this rapid economic expansion was unsustainable.”