The Asian finance crisis drives California into recession in 1999-2002.
Conservative politicians gain power in Sacramento and freeze all non-mandatory state spending.
Even after the economy recovers, the new leaders remain in power and keep education funding tight. A combination of new and old competitors lure away the most motivated and lucrative students from California's colleges and universities, hitting community colleges hardest. By 2008, community colleges across the state are in a state of decline and turmoil, despite a relatively healthy economy. In the end, the worse fears of educators in the late '90s turned out to be true. The Millennium closed with the Asian finance crisis leading to a moderate recession during 1999-2002, which hit California harder than the rest of the nation.