"State Controller John Chiang issued a report Friday showing that tax receipts in January were $528 million lower than the governor assumed in the budget he released a few weeks ago. That budget already assumed a $9 billion deficit." Here.
The article goes on to say:
"With Facebook and other Internet companies poised to rake in billions of dollars in IPOs, and a range of data showing the economic recovery starting to accelerate, Democrats have been hesitant to make the cuts that Brown has urged to close the projected deficit. They argue that the administration is being too gloomy."
The first issue - if the "economic recovery is accelerating" why is California's revenue still decelerating on numbers that have been revised downward something like 5 times?
The second issue - It is becoming an extremely uncomfortable spot to be placing an IPO for anything right now. It doesn't matter that the entire finances of California apparently depends on you. The world doesn't care about your finances California. They have a few problems of their own.
A company that is suppose to have such a strong market position will certainly be embarrassed if the market takes a dive, and the IPO doesn't go well. It hurts your brand.
On one hand I want to feel protective of our Silicon Valley companies. Well, that is until they get into bed with government. Then I feel a lot less sympathy when the teachers union starts trying to boss you around. An entity that instead of thanking their lucky stars that a Facebook is there to bail them out, instead wants to run the company.
I mean, what kind of a stake does the government/teachers union have in Facebook?
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You asked "if the "economic recovery is accelerating" why is California's revenue still decelerating..."?
ReplyDeleteLike Rush* asked the other day after he had his crack staff do some research, "If employment is up, the economy on its way back (I'm paraphrasing here of course) why were 1st Quarter (Oct-Dec, 11) payroll tax deposits DOWN significantly?"
Look at the money? Where's it lead you?
(* I love how Rush pronounces his last name limbaw (with an ah sound however it's spelled), but every and I mean every person on radio and tv, whether they're commentators, news readers, politicians, or whatevers, pronounce it "limbo" It's really obvious. Rush Limbo said; as Rush limbo commented....")
Still follow the money (as I've seen you talk about on posts on this green revolution crap subject.
John
(I'm signing in without my normal google log-in because recently with the Google terms of service changes, I'm thinking of cutting myself off the "do no evil" people and that's the registration system I've been using, along with gmail and a couple of G* evil thingies. Hopefully you know who I am (long winded and all.)