News

Everyone knows the truth. In California it is serious drug addiction that drives homelessness, overdose deaths and retail theft. The solution is mass treatment. Voters took a step in that direction in March by approving Proposition 1, which authorizes Bonds for Mental Health Treatment Facilities. The next step must be taken in November with voter approval of Proposition 36, The Homelessness, Drug Addiction, and Theft Reduction Act that will give judges the tools to require treatment.

Earlier this week, Elon Musk announced he was relocating the headquarters of two California companies to another state after Governor Gavin Newsom signed a law that Musk characterized as infringing on parental rights. Newsom responded by accusing Musk of being a vassal to Donald Trump in a tweet that said: “You bent the knee” to which Musk replied: “You never get off your knees.”

As we’ve reported to you before, GFC is already focused on the 2026 governor’s race because California’s next governor is likely to inherit a precarious situation from Governor Newsom, the candidates who have announced so far are from the usual depressing cast of characters who specialize in loudly signaling virtue to the common person while quietly doing the bidding of special interests, and we are hoping the prospect of early backing by GFC could help elicit a bolder alternative.

The good news is that a tax increase measure has been pulled from the November ballot. The bad news is that Governor Newsom and legislative leaders announced a budget deal that draws from taxpayer reserves and thereby boosts pressure for a tax increase down the road.

Often I’m asked whether California could levy a wealth tax on individuals. My answer is that, absent persistent political pressure by taxpayer advocates, the political door in California is always open to all forms of tax increases, including a wealth tax.

Second quarter income tax estimates are due Monday, though the amount required in California is more than a quarter’s worth of estimated tax. That’s because during a past budget crisis the state imposed a requirement that taxpayers pay more than a quarter’s worth of estimated taxes for each of the first two quarters of the year. That budget crisis went away, but not the imposition on taxpayers.

Earlier this week a reporter asked me to comment about a bond under discussion in the Legislature. I responded that the costs of past obligations already crowd out spending on current programs…

One of the first things I learned after Governor Schwarzenegger appointed me to the board of the California State Teachers’ Retirement System (CalSTRS) in 2005 is that public employees only contribute to their pensions upfront but taxpayers contribute upfront and are on the hook for 100 percent of any funding deficiencies.

Yesterday the Los Angeles Times published an article entitled Newsom called it a ‘gimmick.’ Now he’s using the trick to lower California’s massive deficit in which the Governor’s spokesperson defends the proposed budget and challenges readers to come up with their own solutions to the deficit. I have five such solutions to propose, all of which pertain to reeling in extraordinary patronage spending on public employees:

SACRAMENTO — With a windfall of cash five years ago, Gov. Gavin Newsom said he was doing away with a state budget “gimmick” one of his predecessors relied on to shave about $800 million off a deficit during the Great Recession.