Cal. Gov. Schwarzenegger Begs Geithner for Federal Bailout

May 22, 2009

(ChattahBox)—The State of California’s poll workers were ready for an onslaught of voters for Tuesday’s “life or death” special budget election, which was required to keep the bankrupt state from descending into further calamity and chaos. Only 40 percent of the voters bothered to show up to vote.

Even if all five budget measures passed, California would still be $15.4 billion in debt, as opposed to $21.3 billion if they failed. Well, they failed, so what now California? Governor Schwarzenegger now has his hands out looking for a federal bailout, that’s what.

School closings, massive teacher layoffs, severe cuts in fire and police protection and other essential services, an early releaseof thousands of dangerous prisoners out onto the streets: Not one of these dire consequences of voting against the budget measures phased California voters in the least.

They all just engaged in a collective yawn as they watched yet another budget crisis unfold in their state. Which seems to happen as often as earthquakes in this west coast state of Hollywood actors and perpetual suntans.

California’s government is broken. The state legislature is unable to pass a simple budget and is hopelessly deadlocked. If the legislature had done its job and functioned as a lawmaking body, there would have been no need for Tuesday’s special election. The peculiar laws of California, requires a super majority of two thirds approval in both houses for both tax increases and budget approvals, ensuring complete dysfunction.

California treasurer Bill Lockyer formally requested, last week, for an emergency cash infusion from the TARP program that was put in place to save failing banks and other financial institutions. The treasurer and Governor Schwarzenegger are making the case for extending federal bailout money to bankrupt states as well.

It’s true that the beleaguered State of California has precious few options at this point. They can’t borrow money. Standard & Poor’s recently rated California as having the worst credit rating of any state in the country.

However, most of the 50 states are suffering from severe budget crunches during this deep and prolonged recession. With the banks just starting to recover, credit of any kind is still extremely hard to come by. For those reasons, Congress has showed signs it’s willing to lend a hand to financially strapped states.

The House of Representatives is holding hearings this week to consider a bill to offer loan guarantees and “other assistance” to beleaguered states. California will be the first in line.

Along with financial assistance, perhaps California could benefit from a team of legislative experts to help the state make its government work; even place the ungovernable state in federal receivership. Or perhaps, a good swift kick in the behind to California voters may work just as well.

Source


Comments

4 Responses to “Cal. Gov. Schwarzenegger Begs Geithner for Federal Bailout”

  1. mlimberg on May 22nd, 2009 6:50 pm

    A Federal Bailout for California?

    Oh Hell No….

  2. alamN Bonin on May 24th, 2009 9:57 am

    I think they should be forced to deal with their own problems. They created them with bad decisions on state government expansion. They still have an unfunded pension liabilty of some $200 billion. Are we supposed to bail them out for that as well. They need to make some tough decisions decrease their spending, and improve the business climate of the state.
    Think about this they have a extremely large illegal immigrant population. They estimate it cost them $13 billion a yr to provide services for that population. That is a rather large sum they could get off their budget with something called enforcement of the law.

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