The naysaying over the surplus is quite something.

Headlines running to the effect that California will be in trouble come the next recession, which some fear mongers are saying will start this fall.

But the truth is everyone in the US will be in trouble come the next recession, not just California.

Positioning a coming recession as a Californian problem is absurd. It will be a national problem.

Yes, the California budget has boomed because of taxes on capital gains during a time of incredible price increases in equities. Yes, California has benefited from lucrative IPOs being taxed.

However, state law determines that California can’t just bank the surplus. It has to go back to taxpayers. And as I mentioned earlier, a 1978 law keeps California from spending any more per capita (adjusted for inflation) than it did in 1978, save on items that later propositions determined had to be spent (such as on education.)

Also, some are saying that California getting 46% of its revenues from the rich is problematic. Such a claim is nonsense, something that only some glibertarian might think.

In any recession, unemployment will be very much the worse thing that happens, not the fact that the rich may not be getting richer quite as fast as they have been.

Again, there is a lot of envy out there aimed at California. We are the American Riviera, expensive land and beautiful people. In reality it will remain that way as long as people find it a good place to live (which it still is, contra to the right-wing frothing about the state.)

One of the local politicians, one of the few Republicans San Diego County sends to the state legislature, published an article in yesterday’s local Patch doing the usual Republican thing. Namely, distorting reality. She complained that Newsom wants to raise taxes on gasoline. In reality, the gasoline tax has to be adjusted every year for inflation, by California law. Sure, the legislature could change that law, but it doesn’t want to do so, exactly because of what the fear-mongers monger about: future slowdowns (which means less gasoline consumption hence less gasoline tax revenue.)