Just 1 percent of California taxpayers are already providing 45 percent of the state's income tax revenue. And such income taxes now fund half the budget.But unfortunately, in recent years the number of upper-income earners in California has radically shrunk -- by a third between 2007 and 2009 alone. Apparently, wealthy Californians are either fleeing to nearby no-income-tax states or have become less well-off after years of economic downturn, higher taxes, and overregulation of business. Meanwhile, the number of California's Medicaid recipients grew at 70 percent of the general population increase over the last two decades.
In short, there are no longer enough rich Californians to tax further to make up the state shortfalls. Nor can Californians explain why nearby states, with far less natural riches and without state income taxes, seem to be no worse off than California.
Where, then, lies the solution to the students' protests? Without a rainy-day reserve fund or a growing economy, there are only a limited number of ways to solve California's chronic budget problems.
The state can keep cutting its once-generous entitlements and liberal social services, as well public employees' salaries, to divert money to its colleges. Or it can keep raising fees for state services. Or it can start creating new material wealth by encouraging development of the state's vast resources in gas, oil, timber, minerals and agriculture, whose production has been curtailed in recent years. Or it can lobby the federal government to enforce immigration laws.
Or California can raise taxes across the income spectrum to make up for the diminishing revenue from a vanishing 1 percent.
Yet protesting students would probably believe all those solutions were either unfair or unnecessary. The result is that we are left with mostly liberal students angry at mostly liberal policies of a mostly liberally governed state.
The once-utopian visions of 1970s California -- unionized public employees, more state lands off limits, more regulations, higher taxes on the wealthy, vastly expanded social services, de facto open borders -- have at last mostly come true, but apparently not in the fashion anticipated by most Californians of those long-ago times.
In cash-strapped Greece, when similar things happened, protestors blamed the Germans. But without Germans, whom can Californians blame but themselves?