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The referendum called by the Democratic governor passed by a margin of 54% to 46%. This will generate an estimated $6 billion annually by boosting the income tax for seven years on residents who earn more than $250,000 a year and raising the state sales tax by a quarter of a percent for four years.
The brighter side is that the state doesn’t have to cut on the education budget. “It sold itself,” said Gov. Brown: “The core reason it brought people together was a belief in schools and universities and the capacity of government to make wise investments that benefit all of us.” Last night at a rally in Sacramento, Brown said, “We have a vote of the people. I think the only place in America where a state actually said, ‘Let’s raise taxes for our kids, for our schools, for our California dream.’”
Not only students and the people of California are happy with the new budget. “It’s consistent with our positive outlook,” Gabriel Petek, a San Francisco-based S&P analyst, said. “The measure actually does more than just boost the state’s revenues temporarily. It adds credibility to the governor’s plan to repay a lot of its budgetary debt and liabilities over the next several years.”
A new political wave?
It looks that California might be the state where a ‘new America’ will rise, in a pushback to the political discourse of the proponents of the Tea Party. This is a role this state has played before in recent American history. In the late seventies the ‘taxrevolt’ of the middle classes led to a referendum that is seen as the opening salvo of the preseidency of Ronald Reagan, the archetypical Californian optimist of the right. Also the rise on a similar wave of ‘the Governator’ Schwarzenegger was seen as a first signal of the coming victory of the new populism on the right.
The political vision of president Obama en his Education Secretary Arne Duncan goes in a diametrcally different direction. Securing social mobility and the innovative knowledge economy of the 21st century through education and R&d investments is one of their key strategies. This new wind might now pick up more force and blow from California eastward.