There’s bad news coming out of California, where Governor Arnold Schwarzenegger has declared a fiscal emergency to address California’s deficit Gov. Schwarzenegger has ordered state offices closed three days a month to save cash, and the Legislature will have 45 days to send him a plan to balance the state’s budget, which ended the fiscal year with a $24.3 billion deficit. California’s budget shortfall is expected to grow by $7 billion because the Legislature did not enact several stopgap measures Tuesday, and if lawmakers fail to act within the 45 days, they cannot adjourn or act on other bills until they solve the crisis. It’s also worth noting California’s state economy would be the eighth largest national economy in the world, so a collapse of California’s economy certainly wouldn’t bode well for any economic recovery in the nation – and possibly the world.
I guess the silver lining in this story is that as bad as Wisconsin’s budget deficit is, it could always be worse.
Jct: There’s nothing wrong with small denomination California State IOUs if I or anyone else can pay their taxes with them. When Argentina’s government workers were faced with cuts, their unions talked 6 state governments into paying them with small-denomination state bonds which could be used to pay for state services and taxes and which everyone accepted as useful currency. Best of all, when the local currency is pegged to the Time Standard of Money (how many dollars per unskilled hour child labor) Hours earned locally can be intertraded with other timebanks globally! In 1999, I paid for 39/40 nights in Europe with an IOU for a night back in Canada worth 5 Hours.
U.N. Millennium Declaration UNILETS Resolution C6 to governments is for a time-based currency to restructure the global financial architecture. See my banking systems engineering analysis at http://youtube.com/kingofthepaupers
Too bad California State IOUs won’t be accepted in payment for state taxes and services like state bonds were in Argentina. Too bad California State IOUs will be denominated too big to use as local currency. Too bad Argentina people were smart enough to avoid the tent-cities catastrophe and California people are too stupid to follow their example.
This crisis in California is unbelievable. I am no expert on California’s politics, but I do know that they have been run by lefties for a long time and that Ahnuld is a very liberal Republican. I also know that they are purchasing energy at minibar-like prices. The environmentalist legislation that has occurred in that state has been extremely expensive and has yet to provide such amazing dividends.
They also have not opted to build any new power plants (specifically nuclear power plants) for a very long time. Neighboring states have and rather than risk brownouts, California has had to pay a fortune for the energy generated from other states. It’s a disaster.
As per your last statement about California’s budget deficit being worse: sort of. As for a raw number, they have Wisconsin beat pretty easily. However, when you consider that California’s population is nearly 37 million people and Wisconsin’s is slightly over 5.6 million people, Wisconsin may actually be worse!
I understand there are far more variables than just population, but if one were to make that proportion, our deficit (presuming it is at $6.5 million) would be proporionate to California having a roughly $43 billion deficit.
It kind of makes one wonder how states could be that poorly managed…
Edit: I wish our deficit was $6.5 million. I meant billion.