CHESSNOID

This is no joke. California has a massive deficit and it can’t print up cash like the Federal government which is no real solution anyways.  The federal government has bailed out banks, insurance companies, housing agencies, and auto makers with more money than California’s budget gap, but bailing out California is just another moral hazard and sets precedence in bailing out the other states.  Most states right now have budget deficits.

SAN FRANCISCO (Reuters) -

California’s government risks a financial “meltdown” within 50 days in light of its weakening May revenues unless Governor Arnold Schwarzenegger and lawmakers quickly plug a $24.3 billion budget gap, the state’s controller said on Wednesday.

Controller John Chiang, who has previously warned that California risks running out of cash without a budget deal, said revenues in May fell by $1.14 billon, or 17.7 percent, from a year earlier.

The revenues of the government of the most populous U.S. state fell short of estimates in Schwarzenegger’s budget plan by $827 million, Chiang said.

“Without immediate solutions from the governor and legislature, we are less than 50 days away from a meltdown of state government,” Chiang said in a statement.

“A truly balanced budget is the only responsible way out of the worst cash crisis since the Great Depression,” Chiang said.

This problem was not unforseeable. Why do we have a state controller telling us the obvious after the fact that a balanced budget is the only responsible way out of the worst crash? Because he wants to cover his butt. If this controller was really sincere, he would have sounded the alarms 5 years ago because this is an ongoing problem.

Back in February of this year, this same idiot controller was redecorating his office claiming he was saving money even though we were in a budget deficit and challenging the governor authority on furloughs in an effort to save money. Not!  State Controller John Chiang has failed in doing his job and is now covering his butt to avoid any blame.

Sacramento Bee:

1. Chiang’s New Furniture VO/SOT

A Republican State Senator is criticizing State Controller John Chiang for spending millions to refurnish his office space, during the state’s budget crisis. Chiang has issued a statement in response, claiming he’s saving the state money. Efforting soundbites and video.

2. The Secret Budget VO/SOT

Legislative leaders and the Governor (the Big Five) are continuing to privately negotiate a state budget deal to close the state’s estimated 18 month, $42 billion budget deficit. Because special interest groups such as environmentalists and labor unions will likely not approve of parts of the pending deal, the Big Five reportedly plan to keep details of any negotiated deal secret, releasing it only with scant time for lawmakers to review it before voting for or against it, but without time for special interest lobbyists to scuttle the plan. Efforting soundbites and video.

3. State Credit Rating Lowered VO/SOT

California now has the lowest rating for general obligation bond credit of any state, according to Standard & Poor’s. S&P officials say they still consider California’s long-term economic fundamentals to be strong, but say they think an imminent or brisk economic recovery in the state is unlikely. Efforting soundbites and video.

4. Senior Abuse Grant VO/SOT

At a conference this morning on California’s Senior Centers, Verizon is offering a $300,000 grant to the Congress of California Seniors to increase the awareness of senior abuse and what can be done to stop it. The overall goal of the conference is how to make senior centers attractive to aging Baby Boomers. Efforting soundbites and video.

–ITEMS BELOW FYI ONLY NO VIDEO–

Counties Fight Back- This week the Riverside County Board of Supervisors voted to sue the state for delaying payments to the county for its social welfare programs. Controller John Chiang delayed the payments because of the state’s budget-deficit created cash shortage. Similarly, Los Angeles County has threatened to stop sending the state money it will later receive back from the state for its social welfare programs.

Prop 8 Arguments March 5- The California Supreme Court will hear oral arguments on the challenge to Proposition 8 in San Francisco on March 5. The ACLU and various gay-rights advocacy groups will argue that Prop 8 was a revision of the state constitution, and not a simple amendment that can be enacted by majority-vote. State Attorney general Jerry Brown will argue that the right to marry, even for same-sex couples, is an inalienable right that can’t be amended by voters. The court will have 90 days to rule hearing the oral arguments.

Furlough Decision Appealed, No Stay Sought- Unions representing scientists and engineers employed by the state have appealed last week’s decision by a Sacramento County Superior Court judge that Governor Schwarzenegger has the authority to order state employees to take two unpaid days a month. The unions have not sought a stay of the Superior Court ruling approving the furloughs while the appeal is considered. The Third District Court of Appeals, based in Sacramento, will now decide whether to take the case. The first day of mass furloughs in state offices is scheduled for Friday, with most state offices scheduled to be closed the first and third Fridays of each month through June 2010.

Furlough Clarification Sought- State controller John Chiang has asked a Sacramento County Superior Court judge to clarify his ruling last week that Governor Schwarzenegger has the authority to order state employees to take two unpaid days a month. The governor’s office has interpreted Judge Patrick Marlette’s ruling as extending to employees of the state’s constitutional officers, who are not under the direct authority of the governor.

President Calls Governor- President Obama called Governor Schwarzenegger yesterday to say he’d received Schwarzenegger’s letter supporting Obama’s economic stimulus proposal. The governor’s press secretary Aaron McLear said Obama promised Schwarzenegger they would work together to support job creation. Schwarzenegger and 18 other governors signed the letter that was sent to Obama early yesterday.