The financial guru who correctly predicted the disastrous collapse of Lehman Brothers in 2008 offered a bleak outlook on California’s future.
Robert Kiyosaki, the author of Rich Dad, Poor Dad, is known for making hyperbolic predictions about the U.S. economy, and this time he has a grim forecast for the nation’s most populous state.
‘The problem is that California is going bankrupt’,’ he wrote in X. “California will begin raising taxes and cutting subsidies to the poor, prisons, environmental issues and teachers unions. That means crime will spread as the police are cut.”
He believes even Americans who don’t live in the Golden State should be concerned about its prospects because it’s a bellwether for the rest of the country.
“Since California is a trend state and is going bankrupt, which states will follow suit?” he asked.
So is California really bankrupt?
Robert Kiyosaki, the author of Rich Dad, Poor Dad, predicts calamity for California and suggested people should move
Despite being the fifth largest economy in the world according to Governor Gavin Newsom, A fact that has been discussed in the past. – California is actually facing a huge hole in its budget.
In December 2023, the state Legislative Analyst’s Office reported a massive $68 billion deficit due to a “severe revenue decline” in fiscal year 2022-2023.
In May 2024, a month before state lawmakers were due to approve a budget, Newsom announced the state was still $26.7 billion in the red, though the actual figure was closer to $45 billion, according to the report. Associated Press reported.
The official budget was approved at the end of June and included spending cuts of $16 billion.
Most of the cuts were exactly what Kiyosaki warned about, though it’s important to note that he made his predictions more than a month after the state released its budget.
California Gov. Gavin Newsom signed a budget in late June that cut $16 billion in spending, even though the state’s deficit was more than $45 billion.
Spending on affordable housing programs was cut by $1.1 billion, while spending allocated to the California Department of Corrections and Rehabilitation will be reduced by $358 million.
Kiyosaki’s premonition about raising taxes was also reflected in the budget, as Newsom agreed to raise the tax on Managed Care Organizations (MCOs), which pay into Medi-Cal, the state’s Medicaid program.
As for Kiyosaki’s second claim – that crime will increase due to these policy changes – it’s unclear whether these things will have a direct impact on that at this point.
According to the state Department of Justice, overall violent crime in California increased 3 percent in 2023 compared to 2022.
But if we zoom out and compare the 2023 figures to those of 2019 (before the pandemic crime wave swept across the country), violent crime has skyrocketed by 15 percent.
Pictured: An August 2023 robbery at a Nordstrom store in Topanga, California, where the suspects casually walked out with their arms overflowing with merchandise.
A violent robbery occurred at this convenience store at a gas station in Oakland, California. About 100 people entered and emptied the shelves, but the police never showed up.
Elderly woman brutally attacked in unprovoked assault in Oakland
This is the crazy moment a bold thief casually rips an entire display of iPhones off the shelves of an Oakland Apple store amid Newsom’s new efforts to crack down on crime in the area.
Property crime is also on the rise: shoplifting crimes have increased 61 percent in Los Angeles alone in the past four years.
Oakland may be in the worst situation of all major California cities, with blatant crime scenes becoming increasingly common.
Some of the most shocking incidents include a mass shooting during a Juneteenth celebration in Lake Merritt and an elderly woman who was attacked and robbed in broad daylight.
Just last month, 100 thieves vandalized a gas station and emptied the shelves; their conduct did not prompt a timely police response.
Days after that incident, the Oakland Police Department admitted it only has 35 officers on patrol at any given time for a city with more than 400,000 residents.
Based on all this and more, Kiyosaki said he moved from California and now resides in Scottsdale, Arizona.
Many Californians have followed suit in recent years, with hundreds of thousands moving to Texas in search of lower housing prices and lower taxes.
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