20,000 Teacher Layoffs In California

The Auburn Journal is reporting Statewide teacher layoffs: It’s 20,000.

The number of teachers in California who have been issued notices of potential layoffs has hit 20,000, the state’s education chief said Friday.

School districts are required by law to notify teachers and other certificated staff members that they could be laid off by March 15. The recent layoffs – including dozens in Placer County districts – have been spurred by $4.8 billion in cuts to education contained in Gov. Arnold Schwarzenegger’s January proposed state budget.

In a statement, State Superintendent of Public Instruction Jack O’Connell blamed the layoff notices on a “priorities problem” and decried the governor’s proposed budget for putting student performance “in grave jeopardy.”

“The governor’s budget fails to invest in our future,” O’Connell said in the statement. “We should be encouraging the best and brightest to join the teaching ranks. We know that effective teachers are the number one element in student success. Sadly, the flood of pink slips being handed out only discourages people from entering the teacher profession.”

Layoff notices could be rescinded if the budget picture brightens. The governor’s first proposed state budget is widely considered to provide the most austere spending plan of the budget-making season, but school districts must base their financial projections on the most recent proposal.

Odds of layoff notices being rescinded because of fiscal improvement is slim. Consider the State of California Cash Flow Figures.

“Our receipts were relatively close to the Governor’s latest budget estimates, but many sources of revenue continue to show signs of weakness,” Chiang said. “Retail sales and corporate taxes came in below estimates, and while February’s income tax payments were up, the majority of those taxes will be collected in later months.”

Actual General Fund revenue in February was down $82 million, or -1.5 percent, from estimates found in the Governor’s 2008-09 State Budget proposal, which contains updated revenue projections for the current fiscal year. Personal income tax totals surpassed estimates by $263 million, or 19.2 percent. Sales tax receipts were down $191 million, or -5.1 percent and corporate taxes were down by $24 million, or -12.5 percent.

Sales tax receipts are headed the wrong way and will continue to do so. So will property tax revenues. Income tax was up, but that barely made up for the other projections, and the state is $16 billion in the hole.

Laid off teachers are not going to be buying cars, eating out, or doing much shopping in general. They certainly will not be buying any houses. Some will even decide to walk away. And we are not just talking about teachers here. There will be cutbacks across the board in California's budget. And it won't be just California either.



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By the way, the above picture should not say "Debt". It should say budget deficit and CNBC ought to know the difference.

I do not know why someone posted that on You Tube as "Crooked California Cut Backs" because those cuts are needed and then some as explained in:

• Mish's California Budget Proposal
• More Budget Cuts in California, New Jersey, and Florida
• Grim News For State Budgets
  

What's crooked is spending money you don't have any way of paying back and floating bonds to do it. The day of reckoning has arrived with the mailing of pink slips. But this is just a start. Expect the budget deficit to keep growing and to start hitting more states as the recession picks up steam.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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