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Home Front Economy
Schwarzenegger declares fiscal emergency
2008-12-02
Gov. Arnold Schwarzenegger ordered the new Legislature in to work on its first day, declaring a fiscal emergency Monday in response to the state's deteriorating finances and urging lawmakers to "get off of their rigid ideologies."
How about your multi-billion dollar Global Warming spending?
But even as Schwarzenegger warned that California could run out of cash within two months, there was little indication that the Capitol's partisan gridlock has waned enough to allow for an easy resolution to the state's $28-billion budget gap.

Republican lawmakers, who last week blocked a Democratic proposal to cut billions of dollars from schools, healthcare and welfare programs while tripling the vehicle license fee, quickly reiterated their opposition to any new taxes, which both Schwarzenegger and Democrats say are indispensable. Democratic legislators again dismissed some of Schwarzenegger's proposals to ease labor rules on business in order to boost the economy.
Posted by:GolfBravoUSMC

#18  IIRC State revenues increased by something like 40% over 2000.Unfortunately the expenditures increased by approx 70%. The intelligent voters of blue-county California also locked in mandated %'s of expenditures to education and other causes. An all-around clusterfuck. Any cut in next year's budget increases is slammed in the press as "budget cuts" with willing complicity by the LAT, SF Chron, Sac Bee, et al.

What is needed is a mandated return to a prior year's (say 2005) budget, and all increases offset by cuts instead of tax increases
Posted by: Frank G   2008-12-02 20:36  

#17  I was busy banging my head against the wall in Iraq watching our do-nothing strategy fail when Ahnuld made his first and far as I know only attempt to actually fundamentally change the trajectory out here. His propositions were voted down, and since then he's been fighting a mostly tepid rear-guard action on fiscal matters, while beclowning himself on global-wormening and energy issues. Spectacular, epic, galactic-sized disappointment.

CA was warned years ago that its tax burden was so disproportionately on the upper bracket that huge revenue volatility was certain (here we are - as noted by a commenter, just wait til they see the new revenue figures in Sacramento and in big-metro/county offices).

Meanwhile, CA's tax burden is high overall. So we've got excessive taxes, disastrously stacked against wealth and success and entrepreneurship (this ignores the horrendous regulatory environment), and spending that is out of control.

Just anecdotes, I know. A friend teaches as a guest lecturer at a prominent state college (not a UC). The salaries of the tenured profs are unbelievable - and for this, they plagiarize for their publications, back-stab in a petty manner that defies belief, and mostly teach crap to young minds (we're talking social sciences obviously, not geology or accounting).

The dumbing-down of the country - especially the "educated" elements - may lie behind much of this. CA libs and others are suckers for any stupid faddish "idea" that comes along - stem cell institutes, high-speed rail, unicorn power, you name it. It's rare to meet someone who really has any clue about anything even a few inches outside their professional competence.

Could be we're at that point, long feared by many right-wing death beasts like us, that public "education" and an unhinged politicized media and culture have tipped the balance, and common sense and history have lost, permanently, to prejudice, ignorance, and emotion.
Posted by: Verlaine   2008-12-02 20:34  

#16  professor at the diplomatic academy of Russia's Ministry of Foreign Affairs

Since when are diplomats expected to understand economics?
Posted by: trailing wife    2008-12-02 20:14  

#15  Panarin has been playing too much Shattered Union (2005, 2k games); his prediction is straight plagerized from its manual.
Posted by: swksvolFF   2008-12-02 16:30  

#14  Panarin's daughters will be servicing Arabs and Chechens in Bedouin harems long before his wet dream becomes reality.
Posted by: ed   2008-12-02 14:57  

#13  A Russian scholar is predicting that the United States' current financial crisis will lead to the breakup of the country.

Igor Panarin, a professor at the diplomatic academy of Russia's Ministry of Foreign Affairs, told the newspaper Izvestia on Monday that America will break apart into six regions following the crisis.

"Dissatisfaction is growing, and it is only being held back at the moment by the elections, and the hope that [President-elect] Obama can work miracles," according to a translation by Bloomberg. "But when spring comes, it will be clear that there are no miracles."

Panarin predicts the U.S. will split into: the Pacific, the South, Texas, the Atlantic coast, the central states and the northern states, and hinted that Alaska could be Russia's for the taking.

The professor said China and Russia will become the world's great regulators.

Posted by: Besoeker   2008-12-02 14:44  

#12  We have government salary and pension obligations in CA that are unsustainable. On top of that the voters don't seem able to constrain themselves when it comes to idiotic propositions (high speed rail than no one will ride, govt funded stem cell research, etc, etc.). Fortunately, the repubs in the CA legislature are holding the line on raising taxes. This at least forces the argument over to cutting spending. We'll see how long they can hold out.
Posted by: remoteman   2008-12-02 14:25  

#11  Grant it independence and forget about it.
Posted by: Besoeker   2008-12-02 14:25  

#10  The only reason Davis was recalled was because of his fiscal irresponsibility and incompetence in dealing with the energy shortage.

Now the terminator has also run up the tab to the same amount. Foolishness.
Posted by: newc   2008-12-02 13:59  

#9  California is a Illegal Alien friendly state, with a don't ask don't tell attitude toward handing out state social welfare money.
Posted by: GolfBravoUSMC   2008-12-02 12:54  

#8  Many of the problems in California can be laid directly at the feet of the federal government. We are severely impacted by illegal immigration. I don't know how many billions of dollars it costs us. I don't know if anybody does because the laws prevent making people prove they are citizens before giving them public services. But it has to be a whole helluva lotta money. This is a failure of the federal government so IMHO the feds should be helping us with the expenses.

But our state legislators are like so many spoiled children who are completely out of touch with reality. Arnold isn't perfect but he seems to be doing his best with an impossible situation. It shouldn't be rocket science to come up with a budget where spending does not exceed revenue. But when greed and corruption are involved then the logic gets too convoluted even for the criminals. I don't know what to do about that. It makes me fear for the future of American democracy. Our elected representatives are running this country right into the ground.
Posted by: Ebbang Uluque6305   2008-12-02 12:20  

#7  
What's In Your Wallet?
Posted by: WilliamMarcyTweed   2008-12-02 12:12  

#6  How about we cut some of the bullshit feel-good programs?

Just a thought.
Posted by: mojo   2008-12-02 12:02  

#5  Its not a tumor!

Yes it is. Socialism doesn't work. That accident victim was run off the road by a government chartered armored car hauling money around and it ain't the first incident.
Posted by: swksvolFF   2008-12-02 10:36  

#4  That's a dog act, I hope its just an error that can be corrected. My father draws a pension from the police dept, he hasn't mentioned anything out of the ordinary to me. That's a city pension though, not a state fund. If that was widespread, I'm sure you'd be hearing a LOT of people raising hell.
Posted by: bigjim-ky   2008-12-02 09:13  

#3  I have a very dear friend out in California, who draws a pension from the state for working nearly 30 years as a high school teacher (music and history) - in November his pension check was one quarter of what it was supposed to be. He says, laughingly, that if December's check is down at the same amount, it wasn't just a weird and temporary hiccup. He'll have to get a job after Christmas. (He's in his 80s, and a WWII vet. In good health, but still...) Anyone else hear anything odd like this going on with California state pensions being short-changed lately?
Posted by: Sgt. Mom   2008-12-02 09:05  

#2  Zim politicians haven't fallen dead from strokes [internal types at least]. Why should the legislatures, bureaucrats, and academics of California be different. Operating on a third world model just makes for interesting times. Unfortunately, for the bordering states who'll end up getting a lot of economic refugees, they haven't altered their residency status requirements, so the socialist plague that created this mess will just spread.
Posted by: Procopius2k   2008-12-02 08:23  

#1  Look for CA legislators to fall dead from strokes when they see next year's tax revenues.
Posted by: ed   2008-12-02 07:28  

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