Governor Gavin Newsom and California’s Legislature are facing criticism for their approach to handling the state’s significant budget deficit, projected to be as high as $73 billion. Critics argue that Newsom and his Democratic colleagues are resorting to gimmicks and wishful thinking rather than substantial fiscal reforms to address the shortfall. This includes relying on one-time revenue surges to fund expansions in medical and social services despite clear signs that such revenue boosts are not sustainable. 

Dan Walters with CalMatters notes that California state’s budget analyst, Gabe Petek,  highlighted a disconnect between revenue forecasts and the spending ambitions in Newsom’s budget, suggesting revenue to exceed projections by about $50 billion annually to maintain proposed spending levels. Temporarily suspending appropriations, shifting spending, borrowing, and tapping into reserves are short-term fixes that avoid addressing the underlying structural deficit. This structural deficit, not tied directly to the state’s overall economic health, stems from optimistic revenue projections and spending commitments made under the assumption that the state had its last money windfall.

Such tactics merely postpone the fiscal reckoning, setting the stage for a challenging year and perpetuating a cycle of budget crises. This approach parallels financially distressed families using credit and loans to delay inevitable payment dues rather than making hard decisions to cut spending or increase income.