California has beat its deficit, will have a budget surplus this year
This is HUGE news. Jerry Brown has done it again. The first time he was governor he turned a deficit economy around and created an enormous surplus.
It's also the first really solid sign that the recession is ending.
“The deficit is gone,” Mr. Brown proclaimed, standing in front of an array of that-was-then and this-is-now charts that illustrated what he said were dramatic changes in California’s fortunes.
“For the next four years we are talking about a balanced budget,” he said. “We are talking about living within our means. This is new. This is a breakthrough.”
Mr. Brown was not just talking about a balanced budget. He projected that the state would begin posting surpluses starting next year, leading to a projected surplus of $21.5 million by 2014, a dramatic turnaround from the deficit of $26 billion — billion, not million — he faced when he was elected in 2010.
The governor said California’s finances were strong enough that he wanted to put aside a $1 billion reserve fund to guard against future downturns, and included in the budget sharp increases in aid to public schools and the state university system, both targets of big spending cutbacks.