The economic future of California looks like this and probably suggests the path that US will follow.
Not only did Golden State Democrats maintain control of every statewide elected office; … but Democrats also secured supermajorities in both state legislative chambers.
The California Republican Party is functionally dead. And how is California doing, now that liberals have successfully terminated the state’s remaining conservatives?
For starters, it’s still in debt. Despite Brown’s historic tax hike, the California Legislative Analyst’s Office announced this week that the state still faces a $2 billion budget deficit just for the next fiscal year. California’s liberal electorate has already racked up an additional $370 billion in state and local debt over that last decade. That is more than 20 percent of the state’s gross domestic product.
According to the California State Budget Crisis Task Force, that comes to more than $10,000 in debt for every Californian. And because the state’s credit rating is so low, California taxpayers must fork over about $2 for every new dollar borrowed. In 2012 alone, the state budget included more than $7.5 billion in debt service — more than most states’ budgets.
Don’t think for a second that California’s chronic deficits are caused by low taxes. Even before last Tuesday’s tax hikes, California had the most progressive income tax system in the nation, with seven brackets, and the second-highest top marginal rate. Now it has the nation’s highest top marginal rate and the nation’s highest sales tax. And the budget still isn’t balanced.
The real cause for California’s fiscal crisis is simple: They spend too much money. Between 1996 and 2012, the state’s population grew by just 15 percent, but spending more than doubled, from $45.4 billion to $92.5 billion (in 2005 constant dollars).