This week in California was defined by the relaxing of the state’s shelter in place guidelines, with just about every county ready to begin curbside retail, reopen factories, with at least 19 counties given the green light to reopen even more quickly. Those counties are able to reopen restaurants and stores for in-person dining and shopping. Some Bay Area counties are moving in that accelerated direction, while others are holding off.
Governor Newsom this week laid out new guidelines for restaurants to reopen eventually statewide, even though the state’s death toll continues to climb. While the Covid-19 caseload has plateaued, the state is a long way from putting the crisis on the backburner. The state budget also was on the forefront this week, with the state roughly $54B in the red, Governor Newsom laid out his plan Thursday to close the deficit. Newsom was in negotiations with legislative leaders Friday, the reason why Newsom did not do a live briefing. Legislators have a month to reach an agreement and pass a balanced budget, with much of what they end up with depending on what kind of stimulus package gets passed in Congress.
The issues showcase a classic Gavin Newsom - a policy nerd, an issues wonk, likes to get deep into the weeds and deal with the nuts and bolts of facts and figures. We have seen Newsom driven by data and focusing on the facts. If you look at Gavin Newsom over the years, he’s not afraid to do things that are ‘out of the box’ and be a little bit bold, think about gay marraige or pushing for legal mariijuana, if he thinks it’s the right thing to do. Newsom will still go through the information and make sure his decision holds up to the scrutiny.
While he hasn’t admitted it publicly, Newsom seems to have felt the sting and the push of the people who were critical saying he was moving too slowly. Even though he says he’s driven by data, over the past week or two we’ve seen him expedite things just a little bit, even though he admits he’s hesitant and worried about a spike and a resurgence of this virus of people come out of this too soon.
There has been some pushback on Newsom’s guidelines to accelerate reopening, including no deaths for 14 days, minimal number of cases, hospital and testing capacity, etc. There are counties that are looking for expectations - in a couple of cases there are counties where a single nursing home accounts for all of their deaths, some North Bay counties are saying they’d like to go a little further a little quicker as they have reached most but not all of the guidelines. The Governor has said he’s willing to negotiate and will accommodate regional variances. 22 counties have gotten approval to move a little more quickly, though none in the immediate Bay Area.
In terms of the budget, the situation is grim. It’s the largest deficit in California history, not in terms of percentage, but as far as raw dollars. $15B will be coming out of the schools, and cuts elsewhere the Californians will really feel. California is depending on billions from a stimulus package from Congress so that the cuts won’t actually be that deep. If the state gets the money that Nancy Pelosi is trying to secure the situation may not be so dire, but if they don’t it could be brutal. New taxes are not on the table at the moment, though could come later if the money from Washington doesn’t come through. The difference from past deficits is the existence of a rainy day reserve of funds, started under Governor Brown, of around $16B that will be drawn down over the next three years that will give the state a little extra cushion. The groundwork has been laid for this not to be as bad as it could be, and it’s one reason the Governor is relatively optimistic that people won’t feel these cuts they way they might have felt others in the past.
