California Shows Blue States Can Be Fiscally Responsible

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There is an ongoing political debate in the United States about which political party is more fiscally responsible.  Historically Republicans claimed they were, because they believed in lower taxes and lower spending.  They accused Democrats of being the “tax and spend” party, and this attack line helped the GOP take political control of Congress, the presidency and two-thirds of state governments.

However the Republican Party is no longer fiscally responsible.  They have shown that once they get power they will increase spending while also slashing tax revenues, causing American federal deficits to go to astronomical heights.

And many of the states where Republicans took control and cut taxes have found that they need those revenues to have a functioning state government.  State and local governments can’t run deficits — they must balance their budgets every year.

Because so-called “blue states” with the Democrats in charge are not afraid to tax wealthy people they have sufficient revenues to operate their governments.  This means they put money into schools and roads and water systems — services that citizens demand.

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California is a case in point, with a Democratic governor and a legislature that is also dominated by Democrats.  Although it is not perfect, they have a tax system that provides not only the money to run California government but also to put billions into a surplus, called the “rainy day fund.”

Governor Jerry Brown and the legislature are now debating his latest budget proposal which calls for nearly $200 billion in spending but also adds billions to the surplus fund.  Brown wants to add more to the surplus than the legislature does.  If he has his way the California Rainy Day Fund will be almost $14 billion.

“We’re nearing the longest economic recovery in modern history, and as Isaac Newton observed, what goes up must come down,” Brown said. “This is a time to save for our future, not to make pricey promises we can’t keep.”

What’s remarkable is what else is in the Golden State’s budget.  Brown wants to spend $2 billion on infrastructure upgrades to pay for deferred maintenance on roads, bridges and dams. He also put in his budget $359 million to address the state’s growing homeless crisis.

The state has spent hundreds of millions of dollars fighting forest fires, and Brown just signed an executive order that will spend an additional $96 million on forest management.

California is thriving — if it were a separate country it would have the fifth-largest economy in the world.  It is also the “bluest” state in the country, and is known for its forward-thinking liberal programs and policies.

The most recent budget coming from California’s state government shows that it is being run by people who are fiscally responsible — it is being run by Democrats.  And as a result, all Californians are winning.