Business

State is pessimistic about future, $14.5B in red ink

SACRAMENTO -- A growing number of Californians are bracing for bad economic times this year, and slightly more than half believe the state is headed in the wrong direction, according to a poll.

Nearly three-quarters, or 72 percent, of people surveyed by the Public Policy Institute of California said they expect bad economic times in 2008. It's the most pessimistic rate recorded since the PPIC began surveying voters a decade ago.

The poll results come as lawmakers are faced with having to close a budget deficit expected to reach $14.5 billion through July 2009.

Nearly all Californians, 94 percent, said they saw the state's budget situation as a problem, and more than half, 54 percent, say the state is headed in the wrong direction.

Those surveyed offered mixed messages on budget solutions.

Nearly eight in 10, 78 percent, said they were somewhat concerned about the spending cuts that Gov. Schwarzenegger proposed earlier this month in his budget.

Seventy percent said they thought government could spend less and provide the same level of services.

Most opposed Schwarzenegger's plan to suspend minimum payments to education, but they were divided about his proposal to release 22,000 nonviolent prisoners early from prison.

Although Californians disapprove of how the governor and the state Legislature are handling the state budget, 55 percent and 64 percent respectively, half say they believe lawmakers will be able to work together and accomplish a lot this year.

Not blaming Schwarzenegger

PPIC President and CEO Mark Baldassare said voters were not blaming Schwarzenegger for the state's economic troubles as they did his predecessor, Gov. Davis.

Voters recalled Davis, in part, for the way he handled the state's last economic meltdown, in 2003.

"Californians are waiting to see whether or not Democrats and Republicans can rise to the occasion before they start pointing fingers," Baldassare said in a statement.

The poll also recorded support for a health care bill facing growing opposition in the state Senate. Most Californians, 60 percent, said they favored a ballot initiative requiring all residents to have health insurance and raising fees on employers and hospitals and increasing the cigarette tax.

The PPIC Statewide Survey was supported by The James Irvine Foundation. Findings were based on a telephone survey of 2,000 California adult residents interviewed Jan. 13-20.

The sampling error for the total sample was plus or minus 2 percentage points, with a larger sampling error for subgroups.

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