California State Controller John Chiang said during his address Sept. 3 at Paradise Village in National City the economic forecast calls for weak but sustained growth through 2011.
Chiang also said that national net government borrowing is at an all-time high with more than 10 percent of gross domestic product.
As the state’s chief independent fiscal watchdog, Chiang controls more than $100 billion of public funds.
This year, while jobs increase mostly in health care, private education and utilities, construction, retail and finance have lost the most jobs.
“Our businesses are doing well with the exception of cars and lumber,” National City Mayor Ron Morrison said. “We’ve had to do a lot of selling in order to show people what we’re doing … but we’re meeting the challenges.”
“We know in order to have a balanced budget before the next fiscal year, we have to identify $12.5 million in cuts. But we’re not like the state of California … we don’t dare not bring our constituents an unbalanced budget.”
Chula Vista Mayor Cheryl Cox said the city’s unemployment rate fluctuates between nine and 10 percent in that community.
Though unemployment remains at more than 12 percent in the state, 182,000 new payroll jobs are expected to net in California next year, mostly in the services sector.
Stability in the housing market along with improvements in income and taxable sales spending are good news to the state’s general fund revenue but will not be sufficient for the state’s projected spending.
“Higher taxes could derail this weak and fragile recovery,” Chiang said.
Cox said the notion of borrowing is that you’re going to pay it back. “But the only way you can pay it back in a city is to make sure you’re spending your money as wisely as you can,” she said. “I yearn to be a mayor that says we can spend money because it will service this community.”
Cox said there must be a balance between saving and spending.
