CA voters told Sacramento Dems to 1. stop stealing local funds, 2. not raise taxes, 3. not raise fees, 4. pass a budget on time. 2011 could be fun for CA.
RE: tax hikes were already on a 2/3 requirement.
Looks like California in effect, just voted for spending to be easier and tax hikes to be harder.
If spending is going to be easier and taxing is going to be harder (as California just voted for in their recent propositions), how is California going to raise their revenue if :
* The budget INCREASES (as it usually does and surely will under Gov. Moonbeam )?
* They don’t get the super majority they need to increase taxes ?
I can only think of the following possible scenarios :
1) Revenue grows as a result of a prosperous business climate where new companies are formed, and unemployment is very low ( which increases the tax base ).
2) Go into debt ( sell more of their state junk bonds ).
3) Ask Washington DC (AKA as the rest of the other states ) for help.
4) Print their own money ( OK this one was facetious, but recent their printing of IOUs is very close to something similar ).
With the regulatory burden increasing in California (they just voted down Proposition 25, which would have postponed a horrendous green energy bill ) and the strength of their unions, good luck with achieving #1.
#2 will probably be the only other card they have left to play with. But the interest they’ll pay on their debt is going to be HIGH.
#3 Will happen only if the new Congress caves, and if they do, I’ll keep track of every single one of the RINO Congressmen who votes yes to the California bailout and target them for defeat in 2012.