Column: Trump, GOP budget cuts criticized as ‘cruel’ to Californians

SACRAMENTO — California lawmakers last week began bracing for the grim reality the state may face as President Trump and the Republican-led Congress take steps to slash the federal budget and workforce, cuts that they said will threaten the health and well being of millions of residents in the state.

“If the Republican administration and Congress follow through with the federal budget that contains these cuts to pay for the massive corporate tax breaks they promised their billionaire donors, California will be hurt and the national economy will suffer,” said Assemblymember Gregg Hart (D-Santa Barbara). “Frankly, we don’t have the state revenue required to backfill the lost federal funding.”

Hart made that comment at the end of a two-hour Assembly budget subcommittee hearing held on Thursday to assess the very real threat of cuts to the federal money California relies for its healthcare program for the poor, Medi-Cal, public schools and universities, roadways, food assistance for those in need and other essential government services. According to the California Budget and Policy Center, federal funds account for about a third of the total state budget.

Just how devastating those cuts will end up remains unclear as the budget proposals wind through the Republican Congress and as the federal courts sift through legal challenges to Trump’s attempts to chainsaw federal government agencies.

Democrats, who control both chambers of the California Legislature, did not mince words about the impacts.

“I’ve heard the words challenging, difficult, uncomfortable choices, harmful choices that the state of California would have to make,” said Assemblyman Patrick Aherns of Sunnyvale. “I would disagree with those. I think that the words that we should be using are devastating, immoral, cruel, sickening, catastrophic and immeasurable.”

Republican Assemblymember Heather Hadwick, who represents the massive rural territory in the northeastern corner of California, told her Democratic colleagues that it’s time for California lawmakers to be fiscally responsible and, in light of the potential federal cuts, focus on preserving the most essential programs.

“I want to keep those programs that protect our vulnerable citizens. I was raised by a single mom. I grew up on those programs, but I also want them to be a stepping stone and not a lifestyle,” Hadwick said. “I represent 11 counties that cannot fiscally manage cuts of this magnitude, and they they want to see our government have less waste and be more transparent.”

This is Phil Willon, The Times’ California politics editor, standing in for columnist George Skelton this week. Just how California deals with federal budget cuts will affect the daily lives of millions of Californians in the months and years ahead. Please visit latimes.com early and often to get the latest updates from Sacramento and Washington.

What’s at stake

In the next budget year, California expected to receive more than $170 billion in federal funds, with $134 billion of that going toward state health and human services programs — primarily Medi-Cal, the state’s version of Medicaid, Ann Hollingshead of the nonpartisan Legislative Analysts Office told lawmakers. The Republican leadership in Congress is considering billions of dollars in cuts to Medicaid as they seek to slash federal spending.

Roughly 15 million Californians — a third of the state — are on Medi-Cal, with some of the highest percentages being in rural counties that supported Trump in the November election. More than half of the children in California receive healthcare coverage through Medi-Cal.

California’s public schools are slated to receive $8 billion in federal funds for kindergarten through 12th grade education, mainly for school meals, high-poverty school districts and students with disabilities. California also expected to receive more than $7 billion for higher education.

Federal funds account for more than a third of the $17.6 billion budget at CalTrans, and cuts would affect the state transportation agency’s ability to build and maintain roads and other projects, including those by local governments. About $2.5 billion is budgeted for other state and local programs, most of which is for disaster response and recovery, and roughly $2.4 billion is for environmental protection programs as well as natural resources, according to testimony from Hollingshead and Mary Halterman of the state Department of Finance.

How can California respond?

Hart, who chairs the budget subcommittee on accountability and oversight, started off the hearing by noting that California is a “donor” state, meaning that it sends $80 billion more in tax money to the federal government than it receives back in federal funding.

“Now we’re facing the very real threat of draconian federal spending cuts that will disproportionately hurt California,” Hart said.

Assemblymember Rhodesia Ransom (D-Stockton) asked — given that the state’s most vulnerable are under attack by the Trump administration and Republican-controlled Congress — if there was anyway for the state to withhold the California tax money sent to Washington.

Carolyn Chu of the Legislative Analysts Office doused that idea, though, saying that money going to Washington from California is paid by individuals and by businesses, not the state itself. If taxpayers withheld their payments in some sort of collective action of protest they would face penalties from the federal government.

So, California lawmakers will face some difficult decisions in the months ahead. They can slash essential programs or find a way to raise new revenue to make up for the lost federal funding.

“Deep cuts to Medicaid are especially worrisome because they would destabilize our state budget,” said Scott Graves of the California Budget and Policy Center. “Federal cuts could shift in the range of $10 billion to $20 billion or more in new costs from the federal government to the state government, costs that would need to be absorbed somehow by the state in order to keep the Medi-Cal program whole.”

One way to help fill that shortfall would be to scrutinize some of the $100 billion in tax breaks currently allowed in the state, he said.

“Options could include ensuring that profitable corporations that have benefited from massive tax cuts at the federal level are paying their fair share in taxes here in California,” Graves said.

However, Republican Assemblymember Joe Patterson of Rockin reminded the committee that many of those tax breaks help needy Californians, including the Proposition 13 restrictions on raising property taxes, the student loan interest deduction and the earned income tax credit for low-income workers.

“So tax expenditures, which is government-speak for tax breaks, does significantly help people in California that may be are out of work, maybe need assistance elsewhere, maybe … homeowners are trying to afford their house, maybe they’re seniors,” Patterson said.

What else you should be reading

The must-read: Black lawmakers renew push to assist California descendants of enslaved Americans

The L.A. Times Special: Pick your battles or all-out opposition? Our columnists debate Trump versus the Democratic resistance

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