One area Democrats, GOP agree: California needs a larger rainy day fund

At a moment when Californians can’t agree on much, we’ve found common ground on something that matters: how the state saves for hard times.

One of us is a Democrat. The other is a Republican. We are united about Proposition 2, because this measure isn’t about partisan politics. It’s about basic fiscal responsibility, and it was developed by the people who understand California’s budget best.

California has one of the largest and most dynamic economies in the world. It’s also one of the most volatile. The state ranks fifth in the nation in revenue volatility because of our tax structure, but only 29th in the size of its budget reserves.

When the good times roll, state revenue pours in. When the economy faces challenges, the state is often forced into abrupt, painful cuts to programs Californians rely on: healthcare, higher education, public safety and safety net services.

Seniors, students and working families bear the brunt, often with little warning.

Prop. 2 fixes that imbalance. It doubles the size of the state’s rainy day fund and requires California to save more during strong budget years, so we’re not caught flat-footed when the next downturn hits. 

This is a structural budget fix without raising taxes to save more. It’s the type of budgetary planning we need to protect our future.

This isn’t a new or radical idea. It builds directly on a framework voters approved in 2014. And it reflects more than a decade of experience with how that fund has actually worked. 

Prop. 2 didn’t start with politicians. It was born from budget experts, not special interests. 

The Legislative Analyst’s Office, California’s nonpartisan fiscal watchdog, recommended its reforms, which developed during legislative hearings with input from the Department of Finance, independent fiscal experts and business leaders.

But its earliest supporters were firefighters, small business advocates, healthcare providers and education leaders — people who see firsthand what happens when reserves run dry and cuts land on hospitals, schools and emergency response. 

That list has since grown because state leaders and fiscal experts from across the political spectrum have lived through what happens when California doesn’t save enough.

A stronger rainy day fund would make California more fiscally credible to taxpayers. States that save responsibly don’t just weather downturns better; they also borrow more cheaply and give families and businesses more confidence that the state can keep its commitments, even when the economy turns. 

That’s the real case for Prop 2. California is safer, steadier and more trustworthy when it saves like it means it.

Saving responsibly is not a partisan value. It’s common sense. California’s budget shouldn’t lurch from boom to bust. Prop. 2 gives us a better way forward.