California now less than 90 days away from financial collapse… ANARCHY to follow
07/13/2020 // Mike Adams // Views

The State of California is now less than 90 days away from a financial collapse that can only be averted by acquiring new sources of loans or dramatically slashing government-funded services in health care, pensions, welfare and education. The cracks of financial insolvency are starting to show, and Newsom has no plan that doesn't lead California into anarchy and destitution.

In a desperate effort to delay the financial collapse, Newsom has ordered the state's EDD to delay unemployment checks for as many months as it takes to preserve the state's rapidly-dwindling funds. The Mercury News reports that nearly 2 million Californians have yet to receive unemployment checks covering the first three months of the coronavirus lockdowns, which began in mid-March:

The brutal backlog is further evidence of the troubles plaguing the embattled state Employment Development Department, prompting the newly jobless to complain of an overwhelmed phone system and antiquated technology. The first-time claims have gone unfilled even as Gov. Gavin Newsom has promised reforms and increased staffing for the EDD.

“I have done just about everything I know how to do as a public official to make things work, but my colleagues, my staff, my constituents and I are at our wits’ end,” Assemblymember David Chiu, D-San Francisco, said in a tweet.

Gov. Newsom has been skimming billions from California taxpayers to fund a massive network of bribery to stay in power

Sources tell Natural News that Gov. Newsom has been skimming billions of dollars from California taxpayers, laundering it through communist China under the false pretense of purchasing coronavirus masks ( Chinese companies launder the money and then wire funds back to shell companies controlled by Newsom, who is using the funds to pay out hundreds of millions of dollars in straight-up bribes to California officials in order to suppress any investigations into honest financial accounting. This is why the recent $1 billion mask deal with China has been shrouded in secrecy, as Fox News reports:


California Gov. Gavin Newsom is facing pushback as state lawmakers have begun demanding details of his nearly $1 billion deal to receive 200 million masks per month from a Chinese manufacturer.

“It would be great to get a heads-up directly from the governor’s office rather than watching it on national TV,” Assembly Budget Committee Phil Ting (D-San Francisco) said in an interview Wednesday with the Chronicle.

“We don’t have any information as to how many masks we’re buying, who we’re buying them from, at what price … What are we obligated? For how long are we obligated?”

As a result of the skimming, bribery and fraud taking place right in the middle of a coronavirus lockdown collapse, California has now run out of money. And since the state can't print its own fiat currency (like the Federal Reserve can), it can only survive by either slashing expenses or acquiring new funds through loans, bonds or raising taxes.

The delays in California's unemployment checks, we're told, have nothing to do with a lack of personnel to process the payments. Rather, the checks are being deliberately delayed because the state has no money left to fund the unemployment program.

Similarly, recent cuts that have been announced for police departments are really about slashing cash outflows in order to try to keep the state afloat. Many police departments are funded by a combination of city and state funds, and the Los Angeles City Council recently voted to slash $150 from the LAPD budget, bringing the number of police officers down below 10,000, which will unleash a wave of violent crime across L.A. (Read for more news about California's demise.)

A closer look at California's state budget reveals a shocking picture of financial collapse

California's state budget is around $208 billion for 2019 - 2020. About $80 billion is spent on radical left-wing indoctrination centers known as "public schools" (although not all of this is state-level spending, some of it is local).

Over $100 billion in revenues are generated by the California state income tax. Another $27 billion comes from from sales taxes, and $13 billion comes from corporate taxes. California's general fund took in $143.8 billion last year and spent $147.8 billion in 2019 - 2020, showing that the state had been eating into its safety net of funds even before the coronavirus hit. In all, the state had about $19 - $21 billion in reserves before the coronavirus hit.

Now, thanks to Gov. Newsom's coronavirus lockdowns, California's revenue sources are getting hammered:

  • Lower property taxes at the local level due to businesses and retailers going bankrupt.
  • Reduced state income taxes due to fewer people working.
  • Lower sales taxes due to reduced consumer sales.
  • Lower corporate income taxes due to corporations losing revenues.
  • Severe losses in energy-related revenues (taxes) due to the collapse in energy markets.

In addition, the vastly increased payments the state is making for unemployment benefits and other programs is adding to California's financial woes.

It's all summed up by this CNBC headline from May 7th, 2020: "California faces a staggering $54 billion budget deficit due to economic devastation from coronavirus." As the story reports:

California will have a budget shortfall of $54.3 billion because of the economic devastation wrought by the coronavirus, Gov. Gavin Newsom’s administration announced Thursday, a stunning reversal for a state that had a $21 billion surplus a year ago.

The Newsom administration estimates state general fund revenues will decline by $41.2 billion compared to the $222.2 billion spending proposal Newsom revealed in January. Plus, California must pay for an extra $7.1 billion for increased enrollment in some social safety net programs, including Medicaid, the joint state and federal health insurance program for the poor and disabled.

Another $6 billion in anticipated emergency spending on the coronavirus for things like protective gear, hotel rooms for the homeless and cash payments for low-income adults living in the country illegally pushes the projected deficit past $50 billion.

Meanwhile, lawmakers are already being asked to bail out the state’s essential industries. California hospitals say they have lost up to $14 billion by postponing elective surgeries and other procedures to make room for an anticipated surge of coronavirus cases that never happened. On Monday, the California Hospital Association asked lawmakers for more than $1 billion in aid.

California is broke

In other words, California is broke. The state blew through its "rainy day fund" in just a few weeks of the coronavirus lockdowns, and now California is reeling from the financial costs associated with the coronavirus lockdowns that Gov. Newsom seems determined to continue indefinitely. In other words, the Governor of California won't let California get back to work, which means the $54 billion in losses is just the beginning of the financial carnage yet to come.

By the time 2020 is over, it's no exaggeration to say that California may be $100 billion in the hole due to coronavirus lockdowns and bailout costs. On top of that, with the news now reporting that upwards of 28 million Americans may be homeless over the next few months because they can no longer make mortgage or rent payments, California is about to experience a homelessness problem that has never been witnessed before in the history of the nation. Imagine millions of new homeless flooding the streets of San Francisco, Los Angeles and San Diego, adding to the homelessness problems that already exist in those cities.

It's becoming abundantly obvious that the only way California can remain economically viable is to start raising taxes on its productive citizens, more of whom are fleeing the state due to insane left-wing policies, outrageous authoritarian regulations and punitive taxes on those who produce. As Newsom hikes state income taxes, fees and sales taxes, those who earn money (rather than collecting free money) will increasingly leave the state, leaving behind the non-producers who never contribute any funds to state revenues.

The vicious cycle repeats year after year, until California is reduced to a collection of crime-ridden tent cities inhabited by obedient left-wing homeless people whose only role in society is to fill out multiple mail-in ballots and keep the corrupt Democrats in power. Fiscal sanity is ancient history in California, and the criminality and corruption of Newsom, Pelosi, Feinstein and other power brokers throughout the state is so outrageous that there's hardly a California senator, mayor or governor who doesn't belong in prison, charged with treason.

What will happen, exactly, when California runs out of funds in the months ahead? The state can continue to delay payments to entitlement recipients and pensioners, kicking the can farther and farther down the road in the hopes that an economic recovery might bring a new surge of tax revenues into state coffers. Or the state can try to borrow money by selling bonds or winning loans from foreign nations. reported in March that California had sought a $1 trillion loan from communist China, but sources tell Natural News that President Trump nixed that loan arrangement, as allowing an enemy nation like China to loan money to an entire state would obviously compromise national security. But the timing of the request from Newsom -- March of this year -- shows that Gov. Newsom was fully aware his state would run out of funds very quickly as the coronavirus devastated the California economy (and therefore government tax revenues as well).

The people of California need to be prepared for the financial collapse of their state government

The financial collapse of the California state government now seems imminent. By "collapse," we mean a dramatic slashing of government programs, payrolls, entitlements, pensions and entire departments. The State of California, it now seems, is going to have to slash spending by 50 percent, or roughly $100 billion.

Imagine 50% of the government-funded operations of the State of California ceasing to function. This state expenditures pie chart shows which programs are most likely to be impacted:

According to this chart, the four largest areas of state expenditures are:

  1. Health care
  2. Pensions
  3. Education
  4. Welfare

Unless dramatic cuts are made in these four areas, the State of California cannot meet its financial obligations. This means huge cuts are coming for all these areas.

This also means, financially speaking, California will soon be able to afford only half the expenditures it once made. That spells huge, drastic cuts of state government offices, personnel and services, even as state income taxes and sales taxes are skyrocketing on a percentage basis.

At some point, the remaining rational citizens of California will realize they are paying almost double the amount in taxes while receiving only half as much in government "benefits." The equation exposes debt-based governments for exactly what they are: Money-confiscating frauds that are unsustainable and disastrous to free market economies.

California's cities will soon resemble collapsed third-world nations

The only thing holding California together right now is a massive criminal conspiracy of bribery, money laundering, payment delays and accounting smoke and mirrors. Such tactics can only work for a short amount of time, after which California will be forced to slash government expenditures from top to bottom.

And with the collapse of government services such as health care, schools, law enforcement, welfare and pensions, we are likely to see California cities collapse into desperation, lawlessness and homelessness. Los Angeles, in particular, will rapidly plunge into third-world status, with the Bay Area not far behind.

If you are still living in California for some reason, you may have as little as 90 days remaining before the value of your property there begins to plunge toward zero as it becomes obvious that California is a failed state where no sane person can live long term (except, perhaps, in rural areas far from the cities). Obviously, the cities are going to get hit the hardest, while rural areas of California may be more insulated from the worst effects of all this.

One final upshot that's worth remembering for the rest of the country is that an enormous amount of food production takes place in California, covering everything from nuts to fruits and vegetables. What will happen to the U.S. food supply if California suffers a total financial collapse and the government of California largely ceases to function?

It's a question well worth considering, because it looks like that day draws near.

Read for more daily coverage of the economic collapse we're now facing.

Mike Adams (aka the "Health Ranger") is the founding editor of, a best selling author (#1 best selling science book on called "Food Forensics"), an environmental scientist, a patent holder for a cesium radioactive isotope elimination invention, a multiple award winner for outstanding journalism, a science news publisher and influential commentator on topics ranging from science and medicine to culture and politics.

Mike Adams also serves as the lab science director of an internationally accredited (ISO 17025) analytical laboratory known as CWC Labs. There, he was awarded a Certificate of Excellence for achieving extremely high accuracy in the analysis of toxic elements in unknown water samples using ICP-MS instrumentation.

In his laboratory research, Adams has made numerous food safety breakthroughs such as revealing rice protein products imported from Asia to be contaminated with toxic heavy metals like lead, cadmium and tungsten. Adams was the first food science researcher to document high levels of tungsten in superfoods. He also discovered over 11 ppm lead in imported mangosteen powder, and led an industry-wide voluntary agreement to limit heavy metals in rice protein products.

Adams has also helped defend the rights of home gardeners and protect the medical freedom rights of parents. Adams is widely recognized to have made a remarkable global impact on issues like GMOs, vaccines, nutrition therapies, human consciousness.

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