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Newsom’s relief plan might thwart recall – Press Telegram

The $ 100 billion California Comeback Plan announced by Governor Gavin Newsom on Monday has full political implications.

Newsam will face a call election next fall and may support his retention, but California’s economic recovery from the COVID-19 recession is slow and personal financial instability is sufficient to petition for a call I know I played a role in getting a signature.

“California’s recovery is on track, but simply returning to its original state is not enough,” Newsom said. “We are trebling the Golden State Stimulus to make money in the hands of more middle-class Californians who have been hit hard by this pandemic. Two in three Californians are from the state. Over $ 5 billion will be provided to anyone who receives a check and needs help paying rent or utilities. “

Larger ones can be inferred to make it less likely that the recipient will vote for the recall.

You might even say that the plan is humanely meaningful. Too many Californians lost their income and ran out of rent and utility debt due to the closure of a business that Newsom ordered to curb the spread of the deadly virus. The use of the $ 75.5 billion budget surplus announced by Newsom is acceptable or commendable to help them recover.

“We want to put money in people’s pockets as soon as possible,” Newsom said when he announced his plans in Alameda County.

But what is the economic implication? Not so many.

Newsom is claiming his plans as a way to revitalize and restore prosperity to the economy California enjoyed 18 months before the pandemic. But the $ 100 billion in state tax revenues and federal aid that Newsom wants to inject into the economy is huge, a relative decline in the economic bucket approaching $ 3 trillion a year.

A true recovery will come when more than 1.5 million Californians who are unemployed or have stopped looking for a job get back to work, support their families and pay taxes. Newsome’s plans to achieve that are rare and can have the opposite effect.

Throughout California, when employers resume operations, they complain that they can’t find enough workers to fully staff. This phenomenon is not unique to California, and economists agree that increased unemployment benefits and other pandemic bailout programs have eliminated the incentive for the unemployed to look for a job.

Newsom loves to announce a grand plan he calls “a big hairy and bold goal” of the huge taxable profits of high-income Californian stocks and other capital investments over the past year. As a result, a relatively large budget surplus is expected. Give him the opportunity to think big.

The bailout plan he announced on Monday will consume about $ 20 billion, he plans to roll out other spending plans this week, and propose a revised 2021-22 state budget that will spend billions more. Will be.

Newsom’s relief plan might thwart recall – Press Telegram Source link Newsom’s relief plan might thwart recall – Press Telegram

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