California, Minnesota Budgets Increase Deficits Amid Political Disputes

Several states are grappling with significant budget challenges as they prepare their fiscal plans for the coming years. In California, Gov. Gavin Newsom's 2025-26 budget proposal projects spending about $20 billion more than revenues, relying on emergency reserves and financial maneuvers to balance the books, but it includes cuts largely impacting medical care and social services for the poor, which legislative leaders seek to partially restore along with additional funding for homelessness and local wildfire aid. County officials warn that Medi-Cal cuts could cause 1.2 million Californians to lose coverage, increase strain on emergency rooms, and shift considerable administrative costs to the state, while federal budget resolutions may add to the national deficit and favor tax cuts for the wealthy. Wisconsin faces a complex budget standoff with negotiations stalled and the governor wielding veto power, leaving uncertainty as the current budget expiration approaches. Meanwhile, Minnesota's legislature finalized a $66 billion biennial budget after a special session, amid criticism from Republicans who argue the Democrats' prior spending led to a $6 billion deficit necessitating painful cuts, though some targeted investments like rural cancer care expansion were secured. Across these states, the interplay of rising costs, revenue constraints, and political disagreements highlight the difficult balancing act of addressing social needs while maintaining fiscal responsibility.