San Bruno, CA - On Nov. 18, the California Legislative Analyst’s Office (LAO) announced that the state was facing budget deficits of $20 billion each year for five more years. Over the past fifteen months, California responded to a total budget deficit of $77 billion with a combination of cuts in spending, increases in taxes on working people, federal economic stimulus monies and accounting tricks.
The budget cuts have fallen heavily on public higher education in California, especially the University of California (UC) and California State University (CSU) systems, which have taken 20% cuts in funding. UC students have been at the forefront of militant protests, with thousands hitting the streets on Sept. 24 and thousands more protesting the UC Board of Regents decision to hike tuition to more than $10,000 per year.
The cuts have not just hit UC and CSU students. In the latest round of budget cuts in July, the state cut $6 billion from K-12 public schools and community colleges. Almost $5 billion was taken from local governments, adding to the budget problems of cities and counties. State workers were furloughed for three days a month, cutting their pay by almost 15%. Low-income families on SSI, Cal-Works (welfare), and Medi-Cal (California’s Medicaid health program) had their benefits cut.
These spending cuts hit low-income, working class and oppressed nationality (mainly African Americans, Asian Americans, Central Americans, Chicanos and Mexicanos who make up most of California’s non-white population) communities the hardest. These communities are already hit hard by soaring unemployment that averages more than 12% statewide. California is home to nine of the fifteen metropolitan areas with unemployment rates of over 15%. The metropolitan area with the highest unemployment rate in the country, 30%, is El Centro, California. El Centro is 85% oppressed nationality. High unemployment is contributing to even more home foreclosures and loss of health insurance.
California’s state budget is being hit by a triple-whammy of tax cuts, prison spending and the recession. Following the Proposition 13 property tax cut in 1978, the state took on the main role in funding local school districts, so K-12 education spending grew to about 45% of the state budget. Following the 1994 ‘three-strikes’ law, California came to be the state with the highest rate of imprisonment. Today two out of three state workers are prison employees. Finally, the recession has hit California tax revenues hard, despite increases in taxes on working people, such as the sales tax, which is now almost 10% in most areas of the state.
California is the only state that requires a two-thirds majority for both tax increases and to pass a budget. This allows a minority of right-wing Republican legislators to hold budgets hostage to their demands for more spending cuts. But pro-business Democrat legislators are also at fault. In the latest budget deal in July, the deficit was closed with spending cuts and accounting tricks without any tax increases. Democrat votes passed this deal in the legislature, while most Republican legislators voted against it.
While the federal government has provided billions of dollars in aid to California state and local governments, it was not enough to offset their budget deficits. Given the yawning budget gap, more federal aid is needed. In Washington D.C., concerns about the federal government deficit - $1.4 trillion (or $1400 billion) in Fiscal Year 2009 - is said to limit the options to create jobs or aid state governments. But right now the escalating war in Afghanistan is costing more than a $1 million per soldier per year. It is clear that the Obama administration is placing priority on the military over education and on bombs rather than books and jobs.
In the middle of cutting spending and raising taxes for working people, the California government has given businesses tax cuts worth almost $2 billion dollars a year! Educational administrators such as UC President Yudoff, who has a pay package that costs more than $800,000 a year and a mansion that costs about $300,000 a year to maintain, are rewarded with stunning pay increases.
On college campuses across the state, students, staff and faculty are mobilizing to oppose tuition hikes and cutting programs. They are raising the slogan of “chop from the top” to cut administrative costs and protect classes and student services. A new tide of activism is growing on California college campuses.
Masao Suzuki is Professor of Economics at Skyline College and active with a group of concerned faculty fighting for more cuts in administration and against the termination of programs.