As one of California’s denizens who also has school-aged children, I was quite interested to learn about a site called Next10, through Lazy Man’s post called “Can You Fix California’s Budget”? Next10 asks you questions about how you stand on certain issues that have an impact on the California budget, and based on your responses, comes up with a new, proposed budget. Their questionnaire is aimed to determine how you’d prioritize issues for the sake of resolving the budget crisis.
The California Budget Crisis: How Do We Close The Budget Gap?
Here’s a sampling of the issues which received the most responses:
- 40.7% of respondents want to reduce spending for K-12 pupils in California. The consequence here is that spending will fall below 28% the national average. Unfortunately, schools are already hurting with many resources and programs being cut each year, and are relying more and more on volunteers and fundraising to cover gaps in services.
- 52.5% want to reduce Medi-Cal eligibility for undocumented and new immigrants and are open to eliminating some health care programs for low income people.
- 40.8% want big reductions in human services programs (is this what is called welfare?). This will of course, affect the aged, disabled and poor children and families.
- 50% (including Lazy Man, by his own admission) are willing to release less dangerous inmates and those who end up violating parole.
- 55.4% want to keep unemployment and training benefits as they are.
- 48.3% want income taxes to be raised for the wealthy. There’s a recommendation here for reinstating higher tax brackets for those earning $300,000 a year and above.
- 53.3% want to increase the corporation tax rate. With taxes growing more slowly than corporate profits, increasing taxes in this case makes sense to me.
- 42.8% are for limiting tax breaks.
Let’s cap this with an image of the California Budget projections over the coming years (numbers are in billions). Click the image for a larger picture:
It’s going to be interesting to see how this budget situation will be addressed. Our family will be feeling the effects of this crisis for years to come, with fewer services in our schools. We’ve already experienced some of the fallout firsthand; for instance, just this past school year, our public school lost its principal when she unexpectedly retired (rumored to be because of financial reasons). On top of this, my child’s class ended up with a substitute teacher for most of the year. To add insult to injury, how about this: our school district happened to be invested in Lehman stock, and was part of an investment pool that lost a reported $150 million after the Lehman bankruptcy!
Coping With A Local Economic Crisis
So what’s it like living in a state that has its own financial crisis brewing? How are we coping with things right now?
Over at the US News Alpha Consumer blog, Kim Palmer has begun a new series called “Recession 2.0, Do You Feel It?”, where she’s asked a few bloggers to share their latest thoughts on how bloggers deal with a slowdown in the economy. In general, we’re doing fine, given the economic setting we have right now, but is what we’re doing enough to keep us afloat in Silicon Valley, where the cost of living is ridiculously stratospheric? That’s the million dollar question.
Cutting Costs….Hard: There Go The School Funds
Across California, there are many families that are handling their own budget crisis too. In our case, there are some major changes in our attitude towards our finances. If you’re a parent (or maybe even if you’re not), you can empathize with this story: there’s a little kid, one of our sweet neighbors, who regularly comes by to sell stuff to raise funds for his school. I’m normally pretty generous and buy items from him every time he drops by. I do the same and order a load of items from my own kids’ schools to support our school district. Unfortunately these days, we’re now watching our money like hawks and account for everything that leaves our pockets. This means that $25 scented gift candles and various overpriced assorted bric-a-bracs, chocolates and what not are no longer part of our discretionary budget. So for the first time ever, I had to leave our little neighbor boy empty-handed. The sad part of the story is, the rest of the neighborhood had the same idea (I took a peek at his order list, and it was pretty much empty).
When times get tough, priorities rule even harder.
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