CA Budget Crisis & Pending Cuts Thread

[Butterfly]

seems that Schwarzenegger did a terrible job as a governor, a bit like Reagan

and he seems to be out of his league, he cheated to get the Governship with that California electoral trick, and now Californians are paying for it. They should have stayed with Davis.

couldn't happen to a better idiot,

[barbaro]

seems that Schwarzenegger did a terrible job as a governor, a bit like Reagan

and he seems to be out of his league, he cheated to get the Governship with that California electoral trick, and now Californians are paying for it. They should have stayed with Davis.

couldn't happen to a better idiot,

I cannot say if Schwarzenegger is doing a good or bad job, or an OK, job.

He inherited a fiscal cancer patient on life support.

The problems California now has were put in place and built up over decades - before the economic downturn which has decimated the CA economy.

Whoever takes Arnold's place will be in the same quicksand.

[Cujo]

I wanted to punch that guy for his stupid comments on bacon.

Youtube's blocked here.
What did he say?

[barbaro]

I wanted to punch that guy for his stupid comments on bacon.

Youtube's blocked here.
What did he say?

I don't recall, Dug. It's too bad YT is blocked in China. Can't you get around it using a proxy?

[Muadib]

They should have stayed with Davis.

Davis got setup... Enron, in collusion with the Bush family, hand picked Arnold for the governorship... Enron folded up before they could take full advantage of their puppet so they could steal even more money from Californians in deregulated energy trading...

[Cujo]

I wanted to punch that guy for his stupid comments on bacon.

Youtube's blocked here.
What did he say?

I don't recall, Dug. It's too bad YT is blocked in China. Can't you get around it using a proxy?

It's a real bugger, mostly because I'd like to post videos of my son but also I'd like to watch some vids from time to time also.
The thing with the proxies is they block them as soon as they learn about them and even when you can use one they seem to load the page but not the videos.
More technically adept people than I can't work it out either.

[slackula]

Nice to see California's legislature focusing on the important stuff:

California is one step closer to establishing an annual day honoring Ronald Reagan, the former president, governor and actor.

The state Senate on Thursday unanimously passed a bill designating Feb. 6 as Ronald Reagan Day. It encourages schools to spend the day commemorating Reagan's life and accomplishments.

The legislation, which heads to the Assembly, is one of three Reagan-themed bills Republican lawmakers hope to pass before Feb. 6, 2011. That would have been the 100th birthday of the conservative icon, who died in 2004.

Calif. bill would create annual Ronald Reagan Day


So they'll get a special day to max out credit cards, give guns to the local mosque, shag someone they call "Mommy", and then fall asleep and forget about it the next day?

[Spin]

seems that Schwarzenegger did a terrible job as a governor,

From the little I've seen, I'd say he does a pretty good job, the problem is that the California economy is one massive consumer credit bubble that has burst along with the rest of America. Most people are paraletic drunk on debt and it will be a decade or two before this shit is put right.

It's all downhill from here. The recovery in the stock markets is not being matched in the real economy.

California stands as good a chance of defaulting as Greece IMHO.

[barbaro]

Note* This article is a year and a half old. And it's spot-on.

Obviously applicable to today. California has crapped in its own nest.

These pension numbers are ridiculous.

Archive | Biography | RSS Feed | Opinions Home
Pension Time Bomb

By George F. Will
Thursday, September 11, 2008

VALLEJO, Calif. -- Mayor Osby Davis, who has lived in this waterfront city across San Pablo Bay from San Francisco for 60 of his 62 years, says: "If you have a can that's leaking two ounces a minute and you put an ounce a minute in it, it's going to get empty." He is describing his city's coffers.

Joseph Tanner, who became city manager after this municipality of 120,000 souls was mismanaged to the brink of bankruptcy, stands at a whiteboard to explain the simple arithmetic that has pushed Vallejo over the brink. Its crisis -- a cash flow insufficient to cover contractual obligations -- came about because (to use fiscal 2007 figures) each of the 100 firefighters paid $230 a month in union dues and each of the 140 police officers paid $254 a month, giving their unions enormous sums to purchase a compliant city council.

So a police captain receives $306,000 a year in pay and benefits, a lieutenant receives $247,644, and the average for firefighters -- 21 of them earn more than $200,000, including overtime -- is $171,000. Police and firefighters can store up unused vacation and leave time over their careers and walk away, as one of the more than 20 who recently retired did, with a $370,000 check. Last year, 292 city employees made more than $100,000. And after just five years, all police and firefighters are guaranteed lifetime health benefits.

Even the City Council has at last faced facts and voted 7 to 0 for bankruptcy. "The day after they voted," Davis says, "I didn't go out of the house -- I was that embarrassed."

In other states, municipalities can pay for improvident labor contracts by increasing property taxes. But Vallejo's promises were made in the context of Proposition 13, which 30 years ago wisely restricted California politicians' reach for property taxes. In 1996, the Navy base in Vallejo closed, which probably pleased some local liberals who share the anti-military mentality of San Francisco, to which some Vallejo residents commute by ferry. Liberals who, Tanner says dryly, "want Vallejo to look a certain way," were pleased when Wal-Mart moved to an adjacent town, which now reaps the sales tax revenue.

Vallejo is an ominous portent for other cities, and some states, few of which are accumulating financial resources sufficient to fulfill pension promises they have made to employees. Are you weary of the crisis du jour -- subprime mortgages and all that? Get a head start on worrying about the next debacle by reading Roger Lowenstein's new book, "While America Aged: How Pension Debts Ruined General Motors, Stopped the NYC Subways, Bankrupted San Diego, and Loom as the Next Financial Crisis."

"Next"? This crisis has arrived in Jefferson County, Ala., which includes Birmingham. Like Orange County, Calif., a few years ago, Jefferson County made risky investments in a desperate attempt to achieve asset growth commensurate with the cost of an infrastructure project. When San Diego was earning the sobriquet "Enron by the sea," firefighters could retire at 50 with 90 percent of their pensions -- almost full pay for not working during half of their expected adult lives.

Credit Suisse estimates that state and local governments have a cumulative $1.5 trillion shortfall in commitments for retiree health care. But it is the pension crisis that most dramatically illustrates Lowenstein's thesis about the slow accretion of power by the unions. Pensions "are a perfect vehicle for procrastination; in the financial world, they are the most long-enduring promises that exist." Human nature -- the propensity to delay the unpleasant -- rears its ugly head: When pension benefits come due, the people who promised them, thereby buying labor peace and winning elections, are long gone.

Vallejo's unions contend that the city is solvent enough to meet its obligations. But last Friday a court disagreed, holding that the city is eligible for bankruptcy protection. A lawyer for Vallejo says the unions will have to negotiate a "plan of adjustment." Other cities are watching, perhaps including the one across the bay.

San Francisco recently reported that 184 of its employees made at least $30,000 apiece in overtime in the first half of this year. A nurse at the county jail made $128,000 in overtime, putting him on track to top his total 2007 compensation of about $350,000. Nice work if you can get it, and you can get it in many places.
georgewill[at]washpost.com

Link: George F. Will - Pension Time Bomb - washingtonpost.com

[MrG]

Typical George Will to blame the Unions for the trouble we're in. He writes a nice piece, but nothing original in it.

These cases exist, far too many, but the laws that allow people to manipulate the system or make such extraordinary amounts can be amended. That is, if George isn't afraid of stifiling the free market by restricting entreprenaural imagination. That's what all his corporate buddies shout whenever they talk about raising taxes on them, instead of cutting them for the past 40 years.

[barbaro]

Gov. Arnold will reveal the budget plan in 2 day on May 14th.

Some severe cuts are coming. With the current unemployment in CA to be estimated in the high teens, this will hit some.

People not the US is not like Greece. But in some ways, is California like Greece at the moment?

Austerity.

Schwarzenegger Preps ‘Terrible Cuts’ to Close Deficit




By Michael B. Marois and William Selway


May 11 (Bloomberg) -- California Governor Arnold Schwarzenegger will seek “terrible cuts” to eliminate an $18.6 billion budget deficit facing the most-populous U.S. state through June 2011, his spokesman said.



Schwarzenegger, 62, who will introduce his revised budget plans on May 14, has said he won’t seek tax increases to bolster California’s finances. The Republican’s forecast for the budget gap may rise after revenue fell short of his targets last month.


“We can’t get through this deficit without very terrible cuts,” Schwarzenegger spokesman Aaron McLear told reporters in Sacramento. “We don’t believe that raising taxes right now is the right thing to do.”



California’s revenue in April, when income-tax payments are due, trailed the governor’s estimates by $3.6 billion, or 26 percent. The gap wiped out gains from the previous four months, leaving collections $1.3 billion behind projections for the budget year that ends in June.



Schwarzenegger’s newest plan will revise the proposals introduced in January to account for the tax-collection shortages. In January, the governor said California may have to eliminate entire welfare programs, including the main one that provides cash and job assistance to families below the poverty line, without an influx of cash from the federal government.

Link & Entire: http://www.bloomberg.com/apps/news?p...d=aMHZOCQK9hC4

[MrG]

Schwarzenegger’s newest plan will revise the proposals introduced in January to account for the tax-collection shortages. In January, the governor said California may have to eliminate entire welfare programs, including the main one that provides cash and job assistance to families below the poverty line, without an influx of cash from the federal government.

Undoubtedly accompanied by tax breaks for the wealthy, breaks/givaways to corporations etc.

[Boon Mee]

16 Reasons Why California Is The Next Greece.

[Jet Gorgon]

[
Undoubtedly accompanied by tax breaks for the wealthy, breaks/givaways to corporations etc.

Shame on those rich libbie movie stars. And how much did Al Gore pay for that Montecito mansion? $9 mil? Get him, too.

[barbaro]

16 Reasons Why California Is The Next Greece.

Thanks for the list, boon.

It comes from BusinessInsider.

Yes, California seems to be in bad shape, all the way around. Let's wait until next year. Could be worse.

[Jet Gorgon]

I had hoped that Arnie would be tougher.

[barbaro]

Here is George4Title noting the similarities and differences of California to Greece and other nations.

He aptly notes that the CA budget deficits are not going to decrease but increase.

Tough time ahead.

[Boon Mee]

f you think the situation in California is bad now, wait until Governor Moonbeam gets reinstated. Here's his economic policy:

The conventional viewpoint says we need a jobs program and we need to cut welfare. Just the opposite! We need more welfare and fewer jobs. Jobs for every American is doomed to failure because of modern automation and production. We ought to recognize it and create an income-maintenance system so every single American has the dignity and the wherewithal for shelter, basic food, and medical care. I'm talking about welfare for all.

Is this guy totally full of shit or what???

» Jerry Brown Flashback: We Need More Welfare and Fewer Jobs - Big Government

[Ripley]

I vote we make corporations pay their fair share of State income tax

[Ripley]

f you think the situation in California is bad now, wait until Governor Moonbeam gets reinstated. Here's his economic policy:

The conventional viewpoint says we need a jobs program and we need to cut welfare. Just the opposite! We need more welfare and fewer jobs. Jobs for every American is doomed to failure because of modern automation and production. We ought to recognize it and create an income-maintenance system so every single American has the dignity and the wherewithal for shelter, basic food, and medical care. I'm talking about welfare for all.

Is this guy totally full of shit or what???

» Jerry Brown Flashback: We Need More Welfare and Fewer Jobs - Big Government

Always nice to have an alternative choice. Yes maybe a communal system ..

BM,
Do you honestly think the current economic model is sustainable? Or are you only concerned with assuring your consumer comfort for the length of your life remaining?

[Boon Mee]

Always nice to have an alternative choice. Yes maybe a communal system ..

Hasn't worked too well for the old soviet union, Albania, Cuba etc. And yes, I'm well-interested in prmoting my well-being thru the rest of my life!

[Butterfly]

Socialism is the future, it took 20 years after the fall of Communism for the fall of Capitalism to happen

America is going the European way, no choice. In part thanks to Bush I might add, so Obama shouldn't take all the credit for making America the new socialist power of the world.

[MrG]

Socialism is the future, it took 20 years after the fall of Communism for the fall of Capitalism to happen

America is going the European way, no choice. In part thanks to Bush I might add, so Obama shouldn't take all the credit for making America the new socialist power of the world.

America may be going the European way, I just hope it isn't Germany in the 1930's. I really don't think we're too far from it...another 9/11 could do it, or something that could be ginned up to 9/11 on the fear scale. Then again, America could go something like European Socialism in 50 years or so, but the old corporate guard is going to die ugly, and they owe no allegiance to any country.

[Ripley]

Always nice to have an alternative choice. Yes maybe a communal system ..

Hasn't worked too well for the old soviet union, Albania, Cuba etc. And yes, I'm well-interested in prmoting my well-being thru the rest of my life!

Well BM maybe a real communal system where citizens are taught it's wrong to be selfish and greedy.. Without the education, no it s doesn't work ... We've still got to clean out the generations brought up on ME FIRST ABOVE ALL .

I see a global socialization as I don;t think capitalism has a future beyond mass depletion of resources

Maybe the only commodities that matter, food and water will regain their natural elevated status instead of flat screen tv's phones and watches

[Ripley]

Always nice to have an alternative choice. Yes maybe a communal system ..

Hasn't worked too well for the old soviet union, Albania, Cuba etc. And yes, I'm well-interested in prmoting my well-being thru the rest of my life!

That's not good enough there are 6 billion others, half of whom are like you and concerned only with tomorrow's plans to consume.

First step is to stop reproducing. Second is to only consume what you need.
Capitalism is all about high birth rates and over consumption to make certain people even richer that they already are.

How can you defend it? Why would you continue to enrich those people who don't care abut anything?