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Sort of. California's taxes are already some of the highest in the nation. It has the highest marginal personal income tax rate of 10.3%.
Raising taxes even higher could start encouraging people to leave the state for greener pastures.

There other ways to raise revenue other than raising the personal income tax i.e., increase automobile registration fees, increase tax on tobacco, etc. CA has an $.87 per pack tax on cigarettes, which is relatively low compared to other states. Rhode Island's tax on cigarettes is $3.46 per pack.

With a population of about 38 million, CA has the world's 8th largest economy and is too large to fail. Obama will eventually bail CA out, with certain restrictions and requirements. One thing that has to happen is a change to the state constitution, which requires a 2/3 majority of the legislature to raise taxes. There are only two other states that have this requirement, Rhode Island and Arkansas. The main problem is the dysfunctional legislature, which allows the minority party to stonewall any solutions that require an increase in revenues to balance the budget.
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