I noted the California Senate Appropriations Committee’s plans last week to push a single-payer program through the legislature.
Showing their impeccable timing, the progressives approved the bill in the Senate yesterday at a cost of $200 billion a year…just as the state controller announced that California is set to run out of cash again in April:
State Controller John Chiang issued a stern warning Friday about California’s cash reserves, telling legislative leaders and Gov. Arnold Schwarzenegger they must act on nearly $9 billion in budget cuts the governor is seeking by March — or the state will run out of cash to pay its bills.
Without making those cuts — which Chiang says will pump $1.3 billion into the state’s checking account — California would be broke by April 1, no fooling.
The state wouldn’t climb back to what’s considered a safe level of cash on hand, $2.5 billion, until later that month, when tax revenues are expected to begin flowing into Sacramento.
“While our current cash condition is marginally better than it was one year ago,” Chiang wrote to leaders, “it is still precarious.”
Even with the budget cuts, the state’s cash reserve would still be far below that cushion in March and April.
To that end, Chiang is calling for an additional $2 billion in cash-flow “solutions.” Looking at previous cash crunches, that could mean some payments, like income tax refunds, would be delayed for a few weeks to keep the cushion intact.
Who do you think is going to end up bailing California out?
The Golden State is racked with 12.3 percent unemployment and a budget shortfall of $20 billion, and Gov. Arnold Schwarzenegger (R) warned Friday of even deeper cuts to programs without $6.9 billion in new federal funds. In unveiling an austere budget proposal, he went a giant step further with the age-old state gripe about unequal distribution of federal dollars — actually writing the federal funds in as a budget stopgap.
Some administration officials and lawmakers on Capitol Hill were skeptical that the federal government would provide a bailout to close California’s budget gap, partly because it would set off a cascade of demands from other states.
Been there, doing that…blog comments powered by Disqus
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