California’s Left-Wing Economic Policies Turned $31 Billion Surplus Into $25 Billion Deficit

Layoffs, tax, and price increases are thought to have contributed.

QUICK FACTS:
  • California’s expected $31 billion projected budgetary surplus has turned into what experts believe will be a $25 billion shortfall for the fiscal year.
  • The projections were made in the 2022-2023 California state budget Fiscal Outlook report which was released by the Legislative Analyst’s Office (LAO) one year ago.
  • On Wednesday, a new report from the LAO reported California revenue is $41 billion below expectations for the upcoming 2023-2024 state budget.
  • The LAO has recommended that lawmakers find ways to start cutting the budget when they commence their session in January of this year.
  • Republican Assemblyman Jim Patterson told journalists he doesn’t believe his Democrat colleagues will make cuts to the budget, indicating there might not be a quick resolution to the problem.
  • Research into changes in the state’s economic position indicates that higher taxes have not offset the rise in necessities such as energy costs and food enough to keep the state’s budget in check.
  • Additionally, the exodus of major companies in the technology arena has also decreased the state’s overall revenue.
REASONS FOR THE CHANGE:
  • According to Layoffs.fyi, more than 100,000 American tech workers have lost their employment since the start of the year, including at least 20,300 in November. Meta is laying off 11,000 employees, Twitter is laying off 3,700, Salesforce 1,000, and Amazon 10,000.
  • Currently, high-priced office space is being dropped by Meta, Lyft, Salesforce, and other big companies that are shrinking their in-person working force. The change is due in part to an understanding that they didn’t require as much office space following COVID lockdowns, with staff working from home which also allowed them to shed money spent on high-rent areas of cities.
  • “Tech firms also showed a preference for higher-end workspace, a move that they thought helped attract top talent and enabled landlords to command top dollar for high-quality new properties,” The Wall Street Journal reported. “Big tech’s retreat is a blow to the office market and to many city economies, which for several years have counted on the sector’s real estate appetite to power growth. The national office vacancy rate is 12.5%, up from 9.6% in 2019 and the highest since 2011, according to data firm CoStar Group Inc. Overall, about 212 million square feet of sublease space is on the market, a record since CoStar started tracking the statistic in 2005.”
BACKGROUND:
  • The state of California is being sued by five medical doctors due to a law that allows medical boards to punish physicians for spreading “misinformation.“
  • The law allows doctors to be punished when they offer patents what is deemed to be “misinformation or disinformation” regarding coronavirus.
  • Dr. Tracy Høeg, a California physician, and the four other doctors involved in the case have asserted that the law’s definition of misinformation as “false information that is contradicted by contemporary scientific consensus” in fact violates the First Amendment.