Schwarzenegger Declares "Fiscal Emergency" in California

California Gov. Arnold Schwarzenegger has declared a state of fiscal emergency over the Golden State's $19 billion deficit and five-weeks-overdue budget. The state could begin issuing IOUs to creditors within a month. Reuters' Jim Christie reports:

The deficit is 22 percent of the $85 billion general fund budget the governor signed last July for the fiscal year that ended in June, highlighting how the steep drop in California's revenue due to recession, the housing slump, financial market turmoil and high unemployment have slashed its all-important personal income tax collection.

In the declaration, Schwarzenegger ordered three days off without pay per month beginning in August for tens of thousands of state employees to preserve the state's cash to pay its debt, and for essential services.

California's budget is five weeks overdue, joining New York among big states with spending plans yet to be approved, and Schwarzenegger and top lawmakers are at an impasse over how to balance the state's books.

The gubernator has declared these emergencies in the past. Calitics explains that the emergency can be invoked when budgets are overdue by more than 45 days, and can prevent Sacramento from working on other legislation until a budget gets passed. Maybe we should be in a fiscal emergency all the time.

Comments

[Paul]

high unemployment have slashed its all-important personal income tax collection.

Washington State legislature wants to implement a state income tax because-- according to them-- the State won't suffer revenue issues during down economies because the revenue stream will no longer rely on consumption taxes such as the sales tax.

It's funny how people in the public sector can't imagine a scenario where a poor economy still results in lower revenue when your work force loses their income. Probably because so few people in the public sector ever loses a job.

[Tman]

Every time the scumbags in Nashville attempt to pass a state income tax, the citizens get all Tea Partie'd up and literally storm the steps of the state capitol.

We even have a slick website to help.

http://www.tntaxrevolt.org/

Funny that we don't have an income tax yet our budget is nowhere near as messed up as our neighbors who do have one.

I'm sure Tony has an explanation for that one, but I don't want to hear it.

[Jason]

What's the tax rate?

[Tman]

You mean the sales tax? I believe it's 8.25%. I will always prefer a high sales tax to an income tax. I don't have to pay the sales tax if I don't buy something that is specifically taxed by the state. With an income tax, I'm paying before I get my paycheck no questions asked.

[gaijin]

hah! Cook County Chicago collects 10% sales tax AND you get to pay state income taxes...so you can understand why the state has a fiscal condition somewhere between Greece and Ireland.

[Tman]

I grew up in Taxachusetts, so living in Tennessee took some adjusting.

I thought the first paycheck I got in Nashville was wrong-"you mean I get to keep that much of the money I earned? Sweet. "

[hurly buerhle]

Heh. I moved to Mass from California, and had the same reaction when I saw my first paycheck. 9.3% marginal income tax rates suck.

[skr]

L.A. sales tax is currently at 9.75%

[Dagny T.]

I will be livid if WA gets a state income tax. I really, really hope it doesn't come down to a popularity contest between Bill Gates Sr. and Tim Eyman.

[Douglas Fletcher]

I think they don't care about anything so fundamental as logic.

[Mike M.]

My prediction: should the democrats get creamed in November to the extent that they lose the House, their final parting act in the lame duck session will be a massive bailout of many these failed blue union states, especially the ones with incoming democrat governors.

[Jason]

And a tax increase.

[Paul]

Maybe we should be in a fiscal emergency all the time.

We are.*

*random year chosen.

[?]

I've never seen it spelled "Gubernator" before. Damn Jewish pirate media.

[Pro Libertate]

Did he pull out his sword?

[Anonymous]

There must be two, since James Cameron has one in his office, too.

[Pro Libertate]

Conan has his sword; not sure where Cameron got his knockoff.

[Hugh Akston]

Burn, baby, Burn!

[P Brooks]

I can see the ads now:

"Would you want this man [cut to Charles Manson] living next door to you? Call Governor Schwarzenegger, and tell him Public Safety is too important to use for political gain."

Paid for by California's Public Safety Professionals.

[Paul]

Government: Brought to you by the SEIU.

[Jason]

Ever notice how it's only police, firefighters, and teachers who are ever in danger of being cut out from the budget?

[Jeffersonian]

And never the fatassed Diversity Coordinator?

[Scooby]

Austin's school district tried to fire their Diversity Director (don't know if she's fat-assed... odds are favorable), but got slammed in an administrative appeal. I can feel for the bureaucrat- she did get canned in the middle of a 3 year contract, without cause.

The position should have never existed, but because it did, you can't just eliminate it without living up to contractual obligations.

[Paul]

It's worse than that. It's always a choice between budget cuts to visible services (firefighters, police) and a big phat tax increase.

It never occurs to our reptillian overlords that paying the groundskeepers $56,000 a year might be endemic to the problem.

[JW]

Are you saying Grounskeeper Bill doesn't deserve his $200,000/year pension? What kind of monster are you?

[James Anderson Merritt]

The whole fiscal emergency, budget gridlock thing is only political theatre. Nothing stops the legislature from passing a baseline budget that includes all provisions on which the supermajority of legislators can agree ahead of the statutory budget deadline, and then negotiating for desired enhancements in an AMENDED budget that is passed on or before the deadline. No matter what, the State can have its budget on time, and partisan lawmakers can still have a chance of getting their favorite special item into the final (amended) budget. But there wouldn't be nearly enough political drama in that scenario -- would there? -- and the drama is what the two parties count on, so that they can score political points with their respective bases.

The nation owes a huge debt of gratitude to Jesse Ventura, for making explicit the parallels between partisan politics and professional wrestling. I think of him every time I see a news story about our budget "crisis," not to mention when I see the Governator milking a photo-op on TV.

[Beezard]

Crom will sort this all out...in an orgy of blood and vengeance.

[Conan]

Then we will see our enemies crushed and driven before us, and hear the weeping and lamentations of their wimmin!

[Hockey Guy]

Welcome to the new norm, ever increasing taxes and fees with ever diminishing services.

Coming to your state soon!

[Paul]

Welcome to the new norm, ever increasing taxes and fees with ever diminishing services.

Coming to your state soon!

It's already in your living room, drinking your beer and sleeping with your women.

[JW]

But are they hearing their lamentations too? Because, that's the critical part to understand just how serious that is.

[Hockey Guy]

http://www.latimes.com/news/he.....5137.story

This explains it all!

[Ted S.]

California Gov. Arnold Schwarzenegger has declared a state of fiscal emergency over the Golden State's $19 billion deficit and five-weeks-overdue budget.

That's nothing. New York was supposed to have its budget on April 1, and still doesn't have one.

And very few of the bastards are going to get voted out. Instead, we're going to get another GDF grandstanding Attorney General elected Governor. And you all saw what happened the last time New York did that.

[hmm]

That alt text needs to be, "Stop. Hammer time!"

[hurly buerhle]

In the declaration, Schwarzenegger ordered three days off without pay per month beginning in August for tens of thousands of state employees to preserve the state's cash to pay its debt, and for essential services.

Let's take that logic just a little further, Governor. If we save some cash by having the state employees stay home 3 days a month, how rich would we be if we had them stay home, say,28 days a month?

[JW]

California Gov. Arnold Schwarzenegger has declared a state of fiscal emergency over the Golden State's $19 billion deficit...

What's the problem? I know of a very prominent Nobel Prize Winning Economist who says that deficit should be 10 times that amount in this time of crisis.

Did I mention that he was a Nobel Prize Winning Economist? He can't possibly be wrong, since he's a Nobel Prize Winning Economist.

[R C Dean]

Texas has an 8.25% sales tax, no income tax, and my property taxes are much lower than they were in WI (which has an income tax, as well).

The states have proven beyond any shadow of a doubt that budget problems are the result of spending too goddam much, not taxing too little.