STEVE INSKEEP, HOST:
The economy may be improving but state governments are still working to repair the damage to their books. We're keeping track with a series of reports, and we go this morning to the nation's most populous state, which has some of the nation's largest problems.
RENEE MONTAGNE, HOST:
Here in California today, Governor Jerry Brown gives the State of the State address. He'll outline more cuts to government programs while asking voters to approve a measure to raise taxes. Here's NPR's Richard Gonzales.
RICHARD GONZALES, BYLINE: The good news, says Jerry Brown, is that California's economy is recovering. The bad news, delivered when he recently unveiled his proposed 2012 budget, includes very deep cuts for the poor, elderly and disabled, including $1 billion in cuts to welfare programs.
GOVERNOR JERRY BROWN: We're making some very painful reductions. A mother and kids are getting the same welfare check in real dollars that they got in the '80s. This is not nice stuff, but that's what it takes to balance the budget.
GONZALES: Brown and the legislature are shrinking the state's deficit by grabbing every dollar they can. Last month, they sealed the deal to eliminate municipal redevelopment agencies, freeing up money that can be redirected by the state. But it also blows a big hole in municipal budgets for cities like Oakland that depend on redevelopment funds. Mayor Jean Quan.
MAYOR JEAN QUAN: You're talking about almost every department in the city will be impacted. And so that's $35 million. That's at least 200 jobs, maybe more.
GONZALES: This week, pink slips are going out to 1,500 Oakland city employees, alerting them that their jobs could be on the chopping block - everyone from librarians and police lab technicians to road crews. And that leaves Dwight McElroy seething. He's the president of the union that represents city workers.
DWIGHT MCELROY: The potential impacts are to reduce us from where we are now, which is do I get the car fixed, do I pay my mortgage, do I know what I'll be eating next week this time? And these are working people. These are not indigent. These are good solid civil service employees.
GONZALES: And Governor Brown is not just cutting budgets. He says his plan assumes that voters will approve a November ballot initiative raising taxes. Corey Cook teaches politics at the University of San Francisco.
COREY COOK: What he's doing is trying to make this very tangible by saying, you know, if the budget is passed without these revenue increases, there are specific triggers that will go into effect and there will be immediate consequences.
GONZALES: Brown is proposing a temporary half-set sales tax hike and a new levy on the wealthy. Without the taxes, Brown says public schools would get cut by nearly $5 billion. That approach is tantamount to holding K through 12 schools hostage, says political scientist Dan Schnur of USC.
DAN SCHNUR: Make no mistake about it - this ballot initiative may be the largest ransom note in California political history. Governor Brown is telling the voters of his state that if they don't pass the initiative, untold horrors are going to befall California schools and California schoolchildren.
GONZALES: Schnur says Brown's is a smart political strategy, but the ever-crafty governor denies he's playing politics when asked why he's threatening to cut spending on schools.
BROWN: Like Willy Sutton said - when asked why rob banks, he said that's where the money is. Education is a lot where the money is, and if you don't have money, it comes out of schools.
GONZALES: But Brown is banking on convincing Californians not to go down that path. So today's State of the State address, usually an occasion for lofty rhetoric, is likely to be the official kickoff of his campaign to raise taxes. Richard Gonzales, NPR News, San Francisco.