California today received its Standard and Poor credit rating. California was rated an “A.” It is now the Worst State in the U.S. for credit ratings. It was previously tied for last with Louisiana. Most States in the U.S. have “AAA” or “AA” ratings from Standard and Poor.
California will now have to pay higher interest to investors for its borrowings. This could cost the state billions going forward. For example, Georgia which issued bonds yesterday and has a “AAA” rating had to pay 2.99%. It is estimated California General Obligation bonds would have been priced to yield 4% if it issued bonds yesterday based on its rating.
California is one of the Worst States for Employment.
California also has one of the heaviest tax burdens in the nation.
Its citizens will be paying more taxes to pay for its higher debt costs.