California’s weak economy is continuing to take its toll on the state’s budget. Just weeks ago Sacramento passed a budget that financial experts in Sacramento now predict will be at least $3 billion short. As a result, Governor Schwarzenegger announced yesterday that he will call for a special session of the legislature to address this issue next week.
Republican Leaders Dave Cogdill and Mike Villines quickly requested the Governor make stimulating the economy and putting people back to work a top priority during the special session. The following is the text of their letter to the Governor:
October 27, 2008
The Honorable Arnold Schwarzenegger
Governor, State of California
State Capitol
Sacramento, CA 95814
Dear Governor Schwarzenegger:
California's unemployment rate is the fourth highest in the nation and is at its highest level since March 1996. As you contemplate calling a special session to deal with the ongoing budget crisis, Republicans believe we should address the root cause of our crisis: California's job's climate. Putting the 1.4 million jobless Californians back to work should be our number one priority.
California has one of the highest tax rates on businesses in the nation. California's regulatory burdens also impede job creation. This makes employing Californians a costly business decision. In good economic times businesses may be able to absorb these costs. However, with the tight credit market and worldwide economic turmoil, we must help California businesses to create, retain and expand job opportunities. As such, we respectfully ask you work with Republicans to put California jobs first and consider the following policies:
- A new employee tax credit for businesses that hire out-of-work Californians
- A manufacturing investment credit to help businesses purchase the equipment they need
- Capital gains reduction for businesses that invest in California
- Modification of the tax code to encourage companies to locate jobs in California
- Suspension of regulatory burdens that discourage job creation
Putting Californians back to work is the most important thing we can do for families and to help stimulate our economy during this budget crisis. Additionally, putting Californians back to work will do more to address the mortgage crisis and prevent foreclosures than any costly financial bailout.
We look forward to working with you on addressing this critical economic recovery effort.
Sincerely,
Mike Villines
Assembly Republican Leader
Dave Cogdill
Senate Republican Leader
To read more about Republican solutions, please visit: www.SenateRepublicanBudget.com
