SACRAMENTO, Calif. (AP) — California Governor Gavin Newsom pledged Friday to use the state’s record $300 billion budget, including an unprecedented surplus of nearly $100 billion, to “save” the state from the impacts of a volatile midterm election cycle that he says will undermine abortion access, gun safety and privacy across the country.
The first-term governor of the nation’s most populous state – and potential Democratic presidential candidate – used his budget presentation on Friday to buttress his progressive credentials while attacking his rivals in conservative states.
He trumpeted major increases in health, education, child care and environmental spending while pledging to spend $125 million to facilitate abortion for women in California, including those in other states.
As the U.S. Supreme Court is set to possibly overturn Roe v. Wade next month, Newsom pointed to a sign displaying California’s lower COVID-19 death rate compared to Republican-led states in Florida, Texas and Arizona, all of which should restrict or ban abortions if the court overturns Roe.
Newsom instituted the nation’s first statewide coronavirus stay-at-home order and many credit his aggressive actions throughout the pandemic with saving lives. Critics say he went too far and added to the economic damage.
“If you’re pro-life, how the hell is that possible?” Newsom spoke of the higher death rates in the three states that used a more passive approach during the pandemic. “Spare me their mantra of being pro-life. They don’t deserve this status. »
The sign during Newsom’s presentation referred to California’s comparison with “the most populous states.” Texas is No. 2, followed by Florida. But Arizona is No. 14. The No. 4 state is led by Democrats, strongly in favor of abortion rights in New York, whose COVID death rate is higher than Texas and comparable to Florida.
Bryan Griffin, deputy press secretary for Florida Governor Ron DeSantis, disputed Newsom’s assertion, arguing that in “a properly adjusted format” Florida has come out as well as California with COVID “but still has preserved the personal freedoms of its citizens and didn’t destroy a litany of small businesses in the process.
California’s projected budget surplus of $97.5 billion is unprecedented at the state level and is fueled by soaring tax revenues. It exceeds the combined operating budgets of almost every other state.
The relentless flow of tax money has prompted Republicans in California – who don’t have enough members in the state Legislature to have much influence – to complain about high taxes that reduce quality of life.
“He offered no permanent tax relief to deal with a deepening affordability crisis exacerbated by his policies,” said Republican Vince Fong, deputy chairman of the House Budget Committee. “The governor may not want to acknowledge it, but California is in crisis and its budget is unsustainable.”
Newsom said rising incomes are “a sign of the success of a number of people in this economy” and a reflection of the “concentration of wealth and success in the hands of a few.”
About half of California’s income tax revenue comes from the top 1%, which has done well during the pandemic. This system makes the state more vulnerable than others to the ups and downs of the economy.
Capital gains — the increase in value of assets such as stocks and other investments where most wealthy people derive their wealth — accounted for 9.7% of personal income in California. It is the second highest on record, behind the year 2000, just before the bursting of the dot-com bubble and the start of a recession.
The Newsom administration said it could be a sign the economy is about to slow down again, also citing uncertainties caused by the war in Ukraine, supply chain issues and recent Reserve actions. federal government to fight galloping inflation. He predicts that capital gains income will drop 22% next year.
Newsom’s proposal would leave the state $37.1 billion in reserves while using nearly all of its surplus for non-recurring spending. One of his biggest proposals is to return $18.1 billion to taxpayers in the form of tax refunds and programs that offer help with rent, utility bills and health insurance premiums.
As gasoline prices hit an all-time high in March, Newsom suggested suspending the state’s diesel fuel tax, offering rebates of up to $800 for each person with registered vehicles in state and spend $750 million to give everyone free public transportation for three months.
But that proposal went nowhere in the state Legislature, where Democratic leaders favor a narrower relief package that would only target low-to-moderate income families.
Newsom insisted that the two parties will reach an agreement to withdraw the checks later this year. Republicans argue the state should instead temporarily suspend its gasoline tax, which at 51.1 cents a gallon is the highest in the nation.
“The governor is living in election-year fantasy land if he thinks promises of debit cards and fall rebates will bring relief now,” said Senate Republican Leader Scott Wilk.
Newsom’s budget presentation comes as the state is in the grip of a worsening drought and state energy officials warn of potential power shortages through the summer, when the air conditioning is at its peak.
The governor called on people to reduce their water use by 15%, but consumption increased dramatically in March. Newsom wants to spend more money to encourage conservation, provide loans to struggling drinking water systems and boost water recycling. It includes $75 million for grants to drought-affected farms and businesses.
Meanwhile, he’s asking for $5 billion to create a 5,000 megawatt “strategic reserve” of energy to help the state avoid blackouts. One megawatt can power 750 to 1,000 homes.
Newsom’s budget document included limited details on how this reserve would be built, but he said he was open to the possibility of keeping the Diablo Canyon nuclear facility online after its planned closure in 2025, as well as some gas-fired power plants that are defined. to retire.
The budget plan must be approved by the Legislative Assembly and takes effect on July 1.