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About 500,000 California residents left the state in 2004, while 400,000 US residents of other states moved to California. Many of those leaving California sold high-priced homes and used their accumulated equity to buy lower-priced homes in other states and repay debts. Some believe that newly arrived Mexicans are joining the move of residents to other states with lower cost housing.

The Public Policy Institute of California released a report in October 2005 that found that the state loses less than 0.1 percent of its jobs each year as firms move out of state. Business groups often assert that the high cost of doing business in California leads to job flight.

California faces a structural deficit, meaning that government promises to pay for education, health care, corrections and other services exceed revenues. For 2006, Gov. Arnold Schwarzenegger is promoting a sale of $25 billion in bonds to finance infrastructure improvements, prompting groups concerned about the poor to worry that a focus on highways and bridges may ignore the education and health needs of immigrants.

California's population in 2000 was 47 percent white; 33 percent Latino; 11 percent Asian; six percent Black; and three percent other; by 2020, these shares are expected to be 34, 43, 13, seven and four percent.

Budget. California's annual budget is $114 billion, but the state spends more than it receives. Governor Arnold Schwarzenegger proposed that the state issue bonds, $25 billion in 2006-07, to improve the state's infrastructure http://www.dof.ca.gov/Budget/LatestBudgetInformation.asp).

Welfare. An estimated 28 percent of California residents do not have bank accounts, prompting banks as well as NGOs to offer financial literacy classes that could help especially Latino immigrants from rural areas to reduce banking costs and eventually buy homes. The goal is to help Latino immigrants move beyond check cashing outlets and establish banking relationships.

CalWORKS, California's cash assistance program, provides about $700 for a mother and two children, the most typical caseload. If the adult stops the receiving payments, which are limited to two years without work and a total five years, the children continue to receive about $550 a month, and the family continues to receive food stamps, health care benefits and perhaps housing and other assistance.

Medi-Cal, the state and federal program for poor and disabled people, is reducing payments to doctors who provide services for a fee by five percent in 2006, affecting half of the 6.6 million California residents in the program (half are in managed care programs and half in fee-for-service programs). Legislation pending in Congress would allow states to require Medicaid patients to make co-payments; California spends $34 billion a year on Medi-Cal, including $13 billion in state funds.

Jennifer Delson, "Immigrants Study Their Fiscal ABCs With Interest," Los Angeles Times, November 14, 2005.