Basically, the debt projection is growing $1.2 Billion per month give or take.
late comment: The dates on the x-axes are the projected debt by news article date in 2008. In September of 2007, the projection was ~$9billion.
Anyone who thinks raising taxes needs to talk to someone who employees people. Everyone from my employer to my mechanic will 'suck up' tax increases by reducing head count in California. As much as people like to discredit Reaganomics, the reality is that we've gone too far on the Laffer curve in the state of California. Make fun of 'supply side' economics all you want. But I know of more than a few doctors who will not expand their offices as the added take home revenue cuts their hourly wage. Heck, I was able to see one business study (about a year ago) where taxes pushed an expansion so far into the red, that if the business owner had expanded his take-home would have dropped!
What's sad is economically California is far better off than Florida, Arizona, Nevada, Michigan, and Ohio. Sadly, I think it will take the layoffs of 2Q 2009 and 3Q 2009 to wake people up. :( The layoffs until then will be trivial in California. (Not the case for Michigan and Ohio.) Yes, I called a *really bad* economic year trivial.
Now when will people wake up and realize turning factories into condos and shopping malls is only good if the overall economy is in balance. Oh, I agree with the mills of Connecticut being turned into apartments and condos. Those jobs should have been automated away. But driving out jobs that pay more than the median income for a region? That's just silly.
I'm going to be *very* curious to see how the advertising slump (which has gone past the tipping point) and the Venture capital crunch effect California. I see no way either will reverse within two years; its going to be dot bomb part deux with interest due.
Got Popcorn?
Neil
ps
see the supply/demand curve in my last post to see why the 120 day attempted halt in foreclosures in California is doomed. It might be remembered as the state's Smoot-Hawley.
6 comments:
Add $2b from Prop 1a.
Add $8b from the prison takeover.
There is no limit to the upside.
I feel like CA debt should have a 'but wait, there is more!' label permanently attached.
Just $10B more Dawg?
Ugh.. I'm becoming a bit bitter at how badly the politicians are making this worse. Oh.. they're only a reflection of the people.
"People are smart."
They just didn't say they cut the commercial before the commentator said 'NOT!'
Got Popcorn?
Neil
That's $10b on top of the $28b they've identified. That's just two I know they haven't counted. There's likely a spike in retirement and unemployment costs and their income tax and corporate tax estimates are way off.
Worser and worserer.
Voters approved $10B in new high-speed rail project, but the budget for the project is estimated at more like $40B (private+federal money added), though we'll probably have to kick in another $10B to really get it to happen.
But you might have the chance to buy a $50 ticket from LA->SFO, though driving is cheaper (even if you don't carpool...)
Dawg,
I was pulling your leg. Yea... $28B+$10B+????
Michael, I'm a fan of rail. But this political beast will not be cheaper than an air ticket unless the subsidies are absurd. :( Cest la vie.
Got Popcorn?
Neil
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