Critics of Gov. Gavin Newsom’s (D-CA) proposed 2025-2026 budget are pushing back on claims that President Donald Trump is to blame for the $12 billion shortfall and say the leader has been overspending revenues he erroneously declared the state had for the past three years. 

They argue that Newsom shifting the blame on Trump for the state’s financial woes is part of a highly orchestrated plan to mask that Newsom’s office claimed the state had an almost $100 billion surplus — and blew through it — long before January, when devastating wildfires hit Los Angeles and Trump was inaugurated. 

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Newsom blamed his budget shortfall on Trump’s tariffs and suggested the state had suffered unjustly. 

“We don’t live in Plato’s Republic,” Newsom said. “California is under assault. The United States of America, in many respects, is under assault because we have a president that’s been reckless in terms of assaulting those growth engines. Best to call this a Trump Slump.”

Newsom’s Department of Finance estimated that Trump’s tariffs would damage state revenues by $16 billion, though the office did not specify which tariffs the calculations were based on. The governor also said the wildfires in Los Angeles, which ravaged entire neighborhoods, took an economic toll on the state and forced state and federal officials to delay tax deadlines in the county. 

Republican lawmakers pushed back on Newsom’s claims, arguing that state spending has surged under his leadership.

“Trump slump? Frankly, I think it might be more like ‘Gavin’s Gap,’” state Sen. Roger Niello (R-CA), Vice Chairman of California’s Senate Budget Committee, said. “Newsom’s budget legacy continues as he papers over problems. We’re looking at a budget with shifty spending and long-term pain for his short-term presidential gain.”

Newsom announced last month that California had to scale back on healthcare for illegal immigrants as well as cut back on other programs for the poor and elderly to make up for the damage he claimed the Trump administration did to California.

“Newsom’s revised budget started the blame-it-on-Trump syndrome and legislative leaders quickly embraced it to explain away their chronic failure to either reduce spending or raise taxes to balance income and outgo, a condition known in the Capitol as a ‘structural deficit,’” CalMatters columnist Dan Walters wrote. “Thus all of the versions of the budget, including the semi-final one unveiled this week, would fill the gaps for another year with payment deferrals, loans, accounting gimmicks and raids on reserves meant to cushion the effects of genuine emergencies.”

Walters noted that both direct and indirect loans to the general fund budget are drawn from special funds designated for specific purposes. After three years of deficit spending, California lawmakers have built up billions of dollars in internal debt that will eventually need repayment.

“The accounting gimmickry takes several forms, such as delaying $2.3 billion in support payments to community colleges and local school systems that are due in June 2026 until a month later, thus shifting them from one fiscal year to another,” he said. “Officials call such maneuvers ‘solutions,’ but they don’t solve anything. They merely stave off the day of reckoning when officialdom runs out of tricks. That day will probably come after Newsom has left the governorship and is, perhaps, running for president.”

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State Rep. Carl DeMaio (R-CA) told the Washington Examiner earlier this month that “no amount of Enron-style accounting gimmicks will change the alarming reality that Newsom created a fiscal crisis and he is forcing Californians to pay the price.”

California leaders reached a tentative agreement Tuesday on the state budget, though they have until next Monday to finalize it. Fiscal 2026 starts next Tuesday, July 1.