Explaining Southern California's economy

UCLA economists say CA Prop 30 is a 'double-edged sword'

Gov. Jerry Brown

Sharon McNary/KPCC

California Gov. Jerry Brown speaks in support of Prop. 30 at a rally of UCLA students on campus. According to UCLA economists, the ballot measure could be a "double-edged sword" for the state.

The economists at the UCLA Anderson Forecast have been busy crunching numbers on a state and national economy.

Now they’ve taken a closer look at Prop 30, Gov. Jerry Brown’s successful ballot measure to raise income and sales taxes.

UCLA Economist Jerry Nickelsburg calls Prop 30 a “double-edged sword.” The ballot measure, which passed in November, imposes a state income tax increase on the wealthiest Californians and also raises the sales tax by a quarter of a percent.

Prop 30 was intended to avoid billions of dollars in education spending cuts. Nickelsburg predicts that it could achieve that objective, a real positive given that funding education at an appropriate level will enable the state to remain competitive in an increasingly complex global economy.

But on the downside, he said, Prop 30 doesn’t deal with how Californian keeps the money coming in long-term.