Gov. Brown: “What’s out there is darkness, uncertainty, decline, and recession”

The governor warns California would suffer disproportionately from another downturn

Feb.February 14, 2018 09:24 AM
Jerry Brown and California State Capitol (Credit: Wikimedia Commons)

The state’s job market is volatile. Its finances rely on high earners whose income fluctuates with the health of the economy. And the Trump administration’s plan to reset the country’s foreign trade rules could deal a crushing blow in a state with three of the 10 busiest ports in the country.

All that is a recipe for another potential crisis for the Golden State should the nation endure another economic downturn.

That was the major takeaway at an early budget conference outgoing Gov. Jerry Brown presented. “What’s out there is darkness, uncertainty, decline and recession, so good luck, baby,” he said on Jan. 10.

While the dire outlook was later softened at his Jan. 25 State of the State speech — “We, too, will persist against storms and turmoil, obstacles great and small,” the governor said — he remains skeptical.

He has compared the current situation with those from the last three major economic downturns, and found California suffered disproportionately, according to a New York Times analysis.

During the early 1990s, following the 2001 dot-com crash and the Great Recession of 2008, California has fared worse than the rest of the country. As one example, state revenue dropped 19 percent in 2009, compared to the 8 percent nationwide dip.

Brown’s plan is to pump $5 billion into the state’s emergency fund, bringing it up to $13.5 billion, through his final budget proposal.

In Los Angeles, the city is facing rising homelessness and a severe housing shortage. Developers are also now seeking to take advantage of a new city law that will encourage residential construction built near mass transit. The city also created a measure to set aside money from development project to go toward affordable housing, which is expected to raise between $93 million and $114 million annually.

[NYT] – Dennis Lynch

Related Articles

Assemblyman David Chiu and Gov. Gavin Newsom (Credit: Wikipedia and iStock)

California passes landmark rent control law

LA City Controller Ron Galperin and a groundbreaking ceremony for the first development funded by Prop HHH in December 2017 (credit: Office of Mayor Eric Garcetti)

Market-rate condos for the homeless? It costs just as much under LA bond program

Californians are considering a move out of state because of the cost of housing (Credit: iStock)

Movin’ on out: High cost of housing has Californians considering exit plan

AB 1482 is set to cap rents on units across the LA area (Credit: Wikipedia and iStock)

Here’s what California’s rent control bill means for LA County

From left: Jose Huizar, Huang Wei, Mohamed Hadid, Robert Herscu, Raymond Chan, and Arman Gabay, with Los Angeles City Hall (Credit: iStock and Getty Images)

Real estate’s role in LA corruption scandals

From left: Governor Gavin Newsom, Assemblymember David Chiu, Senator Holly Mitchell, and Senator Nancy Skinner (Credit: Getty Images)

Here are the key housing and rent control bills state lawmakers are debating

A map of the effected areas (Credit: Google Maps and iStock)

Here are the LA cities that have passed strict rent regulations since Prop 10’s statewide defeat

Deliveries are on pace to greatly exceed totals for the last two years

Developers to deliver nearly 10K housing units, but a slowdown looms