Well, folks, it's that time again. Time for another look at the ongoing California state budget crisis. Read our earlier posts on the budget and economy.
Efforts to keep Governor Schwarzenegger from carrying out his threat of slashing state employee wages to the federal minimum have been successful, but only temporarily. Instead of signing the order this past Monday, he is threatening to put it in place today. Call and let him know that it is unacceptable to balance our budget by pushing state employees into poverty! Meanwhile, state employees brought cots to the Capitol for weary lawmakers to protest the proposed pay cuts and extended budget battle.
State Controller John Chiang has vowed he will refuse to follow the order, and will continue issuing full-pay checks to state workers, although his authority to do so is under dispute. Interestingly, Schwarzenegger himself may not have the authority to reduce state worker salaries.
And has anyone noticed that the amount of the budget deficit lines up nicely with the revenues lost because Schwarzenegger repealed the Vehicle License Fee when he first came into office?
The budget impasse is already hurting some California workers: companies doing business with the state haven't been paid since June, and won't be paid until a state budget is passed. Until then these vendors, many of which are small family-owned businesses that rely on the state as their major client, will be forced to cut staff, take out loans, and leave bills unpaid. California hospitals are hurting too, since MediCal payments will not be made until there is a budget.
The budget compromise is still uncertain, but is likely to involve a combination of budget cuts, raised taxes, borrowing, and spending caps. One bit of good news is that the budget deal may be closer than it appears. That's small comfort to the Californians who will fall through the cracks of an underfunded social safety net system.
The housing market continues falling, and foreclosures continue to rise, an economic teeter-totter that has driven many working families out of their homes and into bankruptcy and financial hardship. The earnings gap between the wealthy and the middle class is wider than it’s been since 1928, and wages (adjusted for inflation) are worse than they were in 1970. The situation is harder for women, especially given the economic disparity between male- and female-dominated occupations, and female heads of household face an even tougher time. No wonder the U.S. quality of life is low and going lower.
Oh, and just to put things in perspective: John McCain has been paid more in the past four months for not doing his job than most Americans make in a year for doing theirs.
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