California government declares fiscal emergency over budget

Yahoo/Reuters ^ | 07/1/2009 | Jim Christie

[EagleUSA]

SAN FRANCISCO (Reuters) – California Gov. Arnold Schwarzenegger on Wednesday declared a fiscal emergency to force lawmakers into a special session to tackle a state budget gap that has widened to $26.3 billion from $24.3 billion after they failed to close it on Tuesday.

Lawmakers debated late into the night Tuesday but could not agree on a plan to balance California's budget for its new fiscal year, which began early Wednesday morning.

That cleared the way for state officials to suspend payments owed to vendors and local agencies, who instead will get "IOU" notes promising payment.

The notes would mark the first time in 17 years the most populous U.S. state's government would have to resort to the unusual and dramatic measure -- and would follow warnings by Wall Street that the state's credit ratings may be lowered, which would increase its borrowing costs.

"Though the legislature failed to solve our budget problem yesterday, rest assured that solving the entire deficit remains my first and only priority, and I will not rest until we get it done. I will not be a part of pushing this crisis down the road -- the road stops here," Schwarzenegger said in a statement.

[EagleUSA]

Ain't it amazing. The Taxifornia credit card has been full for a very long time, and these tax-and-spend socialist liberals now want to generate IOUs for more debt. They just cannot help themselves -- gotta spend for power.

Need money? Just run the illegals out of Taxifornia and they would have $12-$15 BILLION per year to pay down the debt -- but, oh-no, we need those illegal votes to keep us in office......a real ugly picture.

[4Liberty]

Public Union cartels rule, decide their own salaries - millions of taxpayers get “exploited,” instead.

The Dems benefit from these unions’ contributions, so never cut the budget, or make services “efficient.” cutting costs would cut THEIR campaign contributions.

This is a Total conflict of interest - it is economic Hell, out here.

How can we BREAK this conflict of interest, and increase COMPETITION in the production of services, including STATE (public) services???????????

HELP!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

[Zeppelin]

a FReeper in another thread suggested that the politicians’ pay be issued in IOU’s until they are able to balance the budget.

Great idea. But we couldn’t have that. Some animals are more equal than others.

[marsh2]

The question is whether or not the banks will accept the IOUs. If they don’t and the County has to hold them, our county is looking into whether we can also issue our own IOUs to vendors and welfare recipients. Although the county will be given IOUs by the state, it will still have to pay payroll with real money. Programs such as mental health, public health and social services are state programs administered and delivered locally by county government under a contract. If limited money is going to float the state through IOUs, we need to guard the little cash we have to sustain core services, such as public safety.

Otherwise, we will have to consider payment by IOUs a nullification of the contract and turn the programs back to the state.

[EagleUSA]

If limited money is going to float the state through IOUs, we need to guard the little cash we have to sustain core services, such as public safety.
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Frankly, I do not think the liberal socialist mindset is that deep thinking. They are so committed to their empowerment, they really do not care who or what they hurt...the deficit is solid testimony to that fact. Washington is no different now, albiet far more radical.