The Legislative Analyst's Office - LAO - has provided a (critical) review of the governor's recent budget proposal for 2026-27 [excerpt]:
...In the budget summary and presentation, the Governor and administration officials have acknowledged the downside risk to the state’s revenue picture. For example, in the budget summary, the administration points out that:
(1) much of the revenue surge is attributable to investor enthusiasm around artificial intelligence,
(2) history suggests these gains are not sustainable, and
(3) the dominant risk to the budget is the stock market and asset price declines.
…But Governor Proposes No Material Actions to Address Downside Risk...
Full review at https://lao.ca.gov/reports/2026/5101/2026-27_Budget_Overview_011226.pdf.
As we noted in our posting on the budget proposal, it is basically focused on avoiding problems for now and getting the governor to the end of his term without having to take drastic measures. His successor, whoever that turns out to be, will have to clean up, if that proves to be necessary, and the governor will be able to pursue his presidential ambitions and say it didn't happen on his watch.
Note that the governor deviated from his past practice and left it to his finance director to handle the news conference at which the budget proposal was unveiled. He thus avoided the kind of nasty questions that the LAO has asked. Reporters did ask the finance director questions about budget sustainability, but the answer was we plan to look at such unpleasant matters in the May Revise.
Yours truly would advise UC to cash the check as quickly as possible.
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