Posted on 01/27/2009 10:27:34 PM PST by Steelfish
Feds' stimulus plan could set stage for California budget deal
By Dan Walters Jan. 27, 2009
The economic stimulus plan being written by President Barack Obama and Congress could cover a third of California's projected budget deficit and give Gov. Arnold Schwarzenegger and state legislators a way out of their political dilemma – but the governor says it would be foolish to count on it.
California's share of direct spending in the package has been calculated at $21-plus billion, and Jed Kolko, an economist for the Public Policy Institute of California, told an economic seminar in Sacramento Monday that about $14 billion of that could underwrite state education, medical care and other spending programs over the next two years.
However, Kolko noted that California's share of the package is no larger than its share of the nation's population and warned that because of its short-range nature it would not resolve the state's enormous structural budget problem.
Minutes later, Schwarzenegger echoed that caveat. It would have, he said, "no effect on the structural deficit," adding, "We don't want the federal government to fix our problem. We have to fix our problem."
Those are rational responses to receiving a temporary infusion of cash from Washington, but politics are not rational. With an assumed deadline for budget action looming in less than a week, politicians may be tempted to write off a big chunk of the state deficit with federal funds.
Schwarzenegger's administration has estimated that the gap between state income and outgo over the next 18 months at $40 billion, and he and legislative leaders have been negotiating over how it would be closed.
(Excerpt) Read more at sacbee.com ...
lol
Losers...
Imagine a family planning their budget, counting on free money from someone else to pay the bills. California is literally a welfare case.
Lurkers Father In Law.
"So I guess that means y'all just get to hold us up for our tax money. Right?"
Lurker
I live in California. I’d like to solve our budget deficit with honest cuts and honest accounting. We do that by reducing spending, much the same as a family would reduce spending when the family’s income is lowered. California has the largest income tax rate in the US, but we can’t live within our means. Shame shame on us.
It’s the Hollywood types,...they aren’t paying their fair share!
politics in California.
Only if all the other states are getting the equivalent bailout in dollars per population, otherwise, it is fiscally sound states and their taxpayers who are bailing out one that is irresponsible. It also means that the non-California taxpayers, are being fleeced, since they cannot vote in a state they do not live in (ACORN excepted) to correct the situation.
This is wealth redistribution on a state level which penalizes states with responsible fiscal policy.
ROFL!
The stimulus plan is nothing but a handjob on the us taxpayer, without the big money shot. Either way we’re getting shafted, stuck with the short end of the stick.
Bailing out states is a bad precedent to set. If you bail out 1, it wont be long till others will be at the till. The individual legislatures of the states will lose all incentive to stay within their budget. The only caveat I would add is it could be done if they had an extreme natural disaster (like Katrina) or a domestic terrorist attack that profoundly impacts their revenue. Failure to plan or stay within budget isn’t going to cut it.
Don’t bail us out. We are 75 percent Mexicans on welfare. If we can’t pay our Mexican friends welfare maybe they will go home.
And what will CA do when that money runs out? They haven’t a clue.
Realestate tax revenues will continue to fall with home prices. Income and sales tax revenue are falling. State employment and employment costs are rising...it isn’t a pretty picture.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.