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The Lowdown on the Calif. Meltdown

Posted on Jun 16, 2009
Flickr/Tim Pierce, Los Gatos

California is still hoping Washington will help out with its Hollywood drama of a budget crisis, but the Obama administration is playing hardball, even though the meltdown of the world’s eighth-biggest economic power could have serious repercussions for U.S. and world financial markets. With public services and the state’s welfare program on the chopping block, something’s gotta give.

The Washington Post:

The Obama administration has turned back pleas for emergency aid from one of the biggest remaining threats to the economy—the state of California.

Top state officials have gone hat in hand to the administration, armed with dire warnings of a fast-approaching “fiscal meltdown” caused by a budget shortfall. Concern has grown inside the White House in recent weeks as California’s fiscal condition has worsened, leading to high-level administration meetings. But federal officials are worried that a bailout of California would set off a cascade of demands from other states.

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By boggs, June 17, 2009 at 8:52 pm Link to this comment

Coloradokarl, Im not sure what you just said. It has no meaning or reasoning that I can interpet.

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By bubbles22, June 17, 2009 at 8:49 pm Link to this comment
(Unregistered commenter)

If Obama won’t help California, then he should expect no help from Californians at election time. What makes me so angry is that California is a donor state. For every dollar we send to Washington we get back 71 cents. Give is back OUR OWN tax dollars, and stop sending them to war pofiteers and corrupt bankers. We’re being robbed.

I wish Hillary had won. Obama is a fraud and a tool of the corporations.

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By coloradokarl, June 17, 2009 at 1:43 pm Link to this comment

Get rid of the government bloat, suffer for a while and don’t rehire when it gets better. There is nothing worse than doing time in a Government job. We will be actually doing these people a favor…..

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By boggs, June 17, 2009 at 11:34 am Link to this comment

Thats right, it takes taxes to pay the bills.
My town in CA. hasn’t seen a school bus in 6 years.
Now this is a hardship for many mothers as well as the fact that it did away with jobs for bus drivers, bus mechanics, and who knows how many trickle down jobs were effected.

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By Jess, June 17, 2009 at 10:58 am Link to this comment
(Unregistered commenter)

The main problem is the public of California thinking in only the short term.  They vote down things that inevitably brought them to the mess they’re in now.  I would hate if they took away certain social programs in exchange for lower taxes.  How do they think things get paid for?

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By boggs, June 17, 2009 at 9:06 am Link to this comment

I remember, it all started with the greed of ENRON
bankrupting the state and the republicans using it as an excuse to oust the democratic governor Gray Davis.
Well, the silly people of CA went along with it, and see where they are now?
What happened to the terminator that was going to fix everything?
He really has fixed everything, almost beyond recognition.

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By Miguel, June 17, 2009 at 4:34 am Link to this comment
(Unregistered commenter)

Give California back to Mexico. Maybe Mexico can do a better job.

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By hippie4ever, June 16, 2009 at 10:32 pm Link to this comment

Pat and JC, I LOVE the idea of Collyforn-ya leaving the union but Washington would never let us. We have to learn our place, or in my case, places because I’m a second class citizen to boot! We must learn to bow before our superiors and be good, meek peasants.

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By Pat, June 16, 2009 at 8:53 pm Link to this comment
(Unregistered commenter)

JC is right.

The Republic of California should print it’s own money backed by the collateral of our agricultural industry + hollywood + import duties + tourist income + manufacturing.

WE have the power!!

no guts no glory!!

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By jc, June 16, 2009 at 8:23 pm Link to this comment
(Unregistered commenter)

If Calif. printed its own money, it would not need to look towards Washington for assistance…wonder if the gov. has real guts, to get his state back on track.  No guts no glory.

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By MarthaA, June 16, 2009 at 5:12 pm Link to this comment

If Arnold was a liberal, he would never consider taking welfare away for children as an option.  I do believe a liberal could find many other options.

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By Alfred, June 16, 2009 at 4:53 pm Link to this comment
(Unregistered commenter)

Arnie gets a bad rub. He was right to try to increase teacher’s tenure.

The public turned it down.

He was right to try and limit the union’s political power.

The public turned it down.

He was right to try and create a rainy day fund.

The public turned it down.

California needs a new state constitution and it needs one badly, which means…

The public will turn it down.

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By Styve, June 16, 2009 at 4:39 pm Link to this comment
(Unregistered commenter)

It’s payback for his complicity in the Enron scam on California and the country!

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By Zach, June 16, 2009 at 4:10 pm Link to this comment
(Unregistered commenter)

Apart from the discussion whether it’s a good idea to bailout California or not, how is it that the United States government puts corporate interests above citizens’ interests?

Let citizens suffer and cut any benefits they may receive, but provide the corporate jerks oodles of corporate welfare. That seems to be the mantra of Congress and the President.

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By bogi666, June 16, 2009 at 3:21 pm Link to this comment
(Unregistered commenter)

Maybe Arnold should retract his comment about Obama’s skinny legs, for a starter. Should Obama not help Calif. the Democrats will pay dearly in future elections. Even Wall St. doesn’t have as many electoral votes.

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By tropicgirl, June 16, 2009 at 2:38 pm Link to this comment

As a former resident of California, this situation occurs on a regular basis. Just like the Federal government, the politicians in California would like for you to believe that all this is due to entitlements and things that actually help people.

This could not be further from the truth. As in the federal budget, there is waste, fraud and abuse. But it benefits the politicians and they like their gravy train.

Just look at what happened to Feinstein and her husband. Perfect example. She passed legislation to allow and fund the purchasing of foreclosed properties. Her husband buys into the company that got the contract. This happens over and over and California is just like the federal cookie jar. The people pay and pay, and they KNOW it. The only thing to do is to watch the politicians let the state go broke (won’t happen).

No, the people of California know this all too well and they are not afraid to use their powers of proposition to stop the increase of taxes, which the people of California CAN NOT afford. Now if we could just put a stop to the corruption on the national level and cut off the money.

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By Mary Ann McNeely, June 16, 2009 at 1:50 pm Link to this comment
(Unregistered commenter)

As a resident of Kollyfornya, I would like to say:

1.  Everybody wants government services but no one wants to pay for them.

2.  Kollyfornya never recovered from Proposition 13, passed 31 years sgo.

3.  Kollyfornya has been Slouching Toward Bethlehem for over 40 years.

4.  Where are you, Pat Brown?

5.  The Austrian is the latest in a long line of posturing political mannequins, Republican and Democrat, who, along with the so-called legislature, got us where we are.  We are about to become the Mississipi of the west (displacing Utah).

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By jonr, June 16, 2009 at 1:40 pm Link to this comment
(Unregistered commenter)

Federal officials are likely right to be worried… It’s not just likely but pretty much certain that a bailout of California would set off a cascade of demands from other states.
Health care crisis, energy crisis, global warming not quite a crisis but for sure one in the making… most of the “great middle class” pretty much at the point where we don’t need any more “stuff,” an economy that runs on the production of “stuff,” and a situation where there is no really sensible way to encourage businesses to produce “stuff” for which there is no demand.

Somebody, somewhere in the United States, is going to need to address the problem of raising taxes and/or reducing services.  Somebody, somewhere, is going to have to make hard choices about whether having moral fiber means taking care of our neighbors in a meaningful way, or simply hoarding what wealth they have and hoping nobody gets testy and does anything drastic on a really, REALLY big scale.

Rush and Bill and Sean seem to be doing a good job convincing people that what’s bad for them is really good for them so far. 
“You don’t WANT health insurance!”  “You don’t WANT clean air.”  “You don’t WANT fuel-efficient cars.”  “You don’t WANT competent and well-paid teachers and nurses.”  Things like that.
Maybe it will keep working; maybe not.

If we’re not going to work together to solve our problems, and apparently we’re not, then somebody is going to have to tangle.  Whatever happens might as well begin with California, and Arnold might as well be in charge as anyone.  He’s so authoritative!

Just think: maybe California can be a dry run for the U.S. in the way that Chrysler is a dry run for G.M.

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By rollzone, June 16, 2009 at 12:56 pm Link to this comment

hello. Arnold; this is the drama; this is the crisis part of the movie. read what your writers…: listen to your director…: what about the producers? this was not supposed to be a comedy; it is not a cartoon. millions of peoples’ lives are at stake. you misspent $11 billion in tax revenues. the economy is collapsing. the rest of the country will not bail out you pot-smoking munchkins. industry has fled your state like a swarm of locusts. illegals are running away like rats off a sinking ship. maybe it is time to legalise marijuana. think of the revenue, and the influx of people into your economy.

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