In June 2022, California celebrated a historic $97.5 billion budget surplus. By 2024, the state faced a $68 billion deficit—a $165 billion fiscal swing in just two years. The state drained reserves, deferred spending, and borrowed internally. The LAO called it "an unprecedented drop" when tax revenues came in $9.8 billion below estimates for a fiscal year that was already over. (Note: Newsom inherited a $21.5B surplus in 2019. Over his full tenure, the state has gone from that $21.5B surplus to projected deficits averaging $30B/year through 2028.)