Gavin Newsom Just Lied With A Straight Face About ‘Fixing’ California’s Fiscal Nightmare

During the budget hearing on Tuesday, state analyst Rachel Ehlers from the Legislative Analyst’s Office (LAO) informed lawmakers that California’s fiscal condition remains poor. This, despite the strongest revenues in years.

“Despite these booming revenues, the state’s underlying fiscal condition, in our assessment, is not sound. We continue to have a structural deficit, both for the coming budget year, ’26-27, as well as forecast for ’27-28, even under the governor’s proposals,” Ehlers said.

She noted that planned expenditures still outpace expected revenue. The only way to balance the budget is to steal money from California’s reserves: