California Voters Reject New Tax Hikes
The buck stops here…
Voters rejected the new tax hike proposals in California tonight.
As expected, California voters were rejecting a package of ballot measures in Tuesday’s special election that would reduce the state’s projected budget deficit of $21.3 billion to something slightly less overwhelming: $15.4 billion, early returns showed.
The defeat of the measures mean that Gov. Arnold Schwarzenegger and the state legislature will have to consider deeper cuts to education, public safety and health and human services, officials have said.
Propositions 1A through 1E were being defeated in early returns. Those measures seek to change the state’s budgeting system, ensure money to schools in future years and generate billions of dollars of revenue for the state’s general fund.
The only measure voters were approving was Proposition 1F, which would freeze salaries of top state officials including lawmakers and the governor, was the only measure that was leading in early results.
The state has asked the federal government to backstop its borrowings. California needs to borrow some $13 billion this summer. But it has the worst bond rating of any state. That’s why it needs the Treasury to guarantee its short-term municipal bond sales –CNN.
NewsBusters reported that ABC was upset that voters would turn down the tax hikes.
More… From Instapundit— MEGAN MCARDLE: California is hosed: “California is completely, totally, irreparably hosed. And not a little garden hose. More like this. Their outflow is bigger than their inflow. You can blame Republicans who won’t pass a budget, or Democrats who spend every single cent of tax money that comes in during the booms, borrow some more, and then act all surprised when revenues, in a totally unprecedented, inexplicable, and unforeseaable chain of events, fall during a recession. . . . Whoever is to blame, the state was bound to go broke one day, and hey, today’s that day! There is a surprisingly sizeable blogger contingent arguing that we have to bail them out because however regrettable the events that lead here, we now have no choice. But actually, we do have a choice: we could let them go bankrupt. And we probably should.”