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O’Leary Ventures Chairman Kevin O’Leary appears on “Evening Edit” to discuss the Biden administration’s green energy rollback and the economic impact of California regulations.
California Governor Newsom on Wednesday proposed that the state put money into a “Rainy Day Fund” to eliminate a projected $37.9 billion deficit.
Newsom stopped short of calling California’s budget deficit a “crisis,” but the Democratic governor’s proposal to draw more than $13 billion from the state’s reserves would require declaring a “fiscal emergency.” there will be.
The proposal, outlined at a press conference Wednesday, aims to protect investments in education and public safety, as well as efforts to address homelessness and the mental health care crisis and combat climate change. .
California Governor Gavin Newsom (Justin Sullivan/Getty Images/File/Getty Images)
The governor emphasized that the nearly $38 billion deficit is significantly lower than the $68 billion projected last month by the Legislative Analysis Service.
“We’re just not as pessimistic about next year as they are,” Newsom said of the difference in numbers.
Still, the budget could delay minimum wage increases for more than 400,000 health-care workers and force spending cuts across a range of housing policies and climate programs.
California to provide free medical care to 700,000 illegal immigrants as deficit soars
Newsom has vowed not to roll back on previous major spending promises, including free kindergarten for all 4-year-olds and free health insurance for all low-income adults, including undocumented immigrants.
The latter, the last announced by the governor, aims to provide health insurance to about 700,000 undocumented immigrant residents between the ages of 26 and 49. The state has been offering free health insurance to undocumented immigrants under the age of 26 since 2019.
Gov. Gavin Newsom signed a bill in September that increases the minimum wage for fast food workers in California to $20 an hour. (Sarah Reingewirtz/Media News Group/Los Angeles Daily News via Getty Images/File/Getty Images)
The Newsom administration argues that providing such medical care to undocumented immigrants will reduce the likelihood of emergency room visits and expensive treatment for illnesses, placing additional burdens on California taxpayers in the future. are doing.
The government’s proposed budget for 2024-25 also includes $8.5 billion in spending cuts, with about half of the cuts going to various programs related to housing and climate change. The remainder of the deficit is due to a combination of delays, postponements, borrowings and shifting costs to other funds.
Newsom also wants to spend $126.8 billion on public schools, about $2.4 billion less than last year. To make up the difference, Newsom is using money from a special savings account for public schools approved by voters in 2014.
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Republican Rep. James Gallagher called the governor’s budget proposal “pure fantasyland.”
“The governor doesn’t want to admit that he put the state in financial crisis,” Gallagher told FOX News Digital. “He has not yet come to terms with his spending, and his proposal to empty savings accounts does nothing to fundamentally solve our spending problems.”
The Associated Press contributed to this report.
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