California has a huge budget surplus. So why does Gavin Newsom want to raise taxes?
With a $21.5-billion surplus, Gov. Gavin Newsom’s televised update to his proposed spending plan for the 2019-20 budget on Thursday — known as the annual May revise — was a little like watching “Oprah” on giveaway day. “You get a car! You get a car! You get a car!”
In this case, millions or even billions for everyone: More money for healthcare. More money for schools and universities, for preschool and child-care. More for building housing, for helping the homeless, for fighting infectious diseases, for hiring new judges, for … well you get the idea.
It’s great that, after a decade of painful recovery from recession, the state’s finances are now flush enough to invest more heavily in programs that make the state a better place. That’s what we pay taxes for, after all. Even so, Newsom’s $213.5-billion spending plan doesn’t go hog-wild. It beefs up payments to unfunded pension liabilities and puts more money in savings for the inevitable downturn.
But this windfall will make it tougher for Newsom to sell some of the proposals tucked into his suggested budget that would extract more money from Californians or their businesses to pay for, among other things, clean drinking water and the two additional weeks of paid family leave that are part of his “Parents Agenda.” He is also seeking a tax penalty on people who don’t buy health insurance.
Legislators should push back on these proposals when they start hashing through the details. Republicans have already made it a talking point: Even before Newsom stopped answering questions about the revised budget, the responses rolled into media inboxes. “The Governor’s plan to increase taxes while the state enjoys a record surplus defies logic,” Assembly Budget Committee Vice Chairman Jay Obernolte (R-Big Bear Lake) said in a statement.
But it should be an issue for fiscally minded Democrats too. This surplus suggests that Californians are already shelling out a fair amount of dough to fund the government. Is it the right time to ask for more?
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