And the beat goes on. Marx would be so proud.

Official says Calif. could be broke in 2 months
By JUDY LIN, Associated Press Writer Judy Lin, Associated Press Writer
Tue Dec 23, 12:23 am ET

SACRAMENTO, Calif. – California's chief financial officer warned Monday that the state would run out of money in about two months as hopes of a Christmas budget compromise melted into political finger-pointing by the end of the day.

Republican Gov. Arnold Schwarzenegger began the day on a cheerful note, suggesting that negotiations with Democratic leaders could lead to a budget deal as early as this week to help close the $42 billion shortfall that is projected through June 2010.

"Yesterday we sat there for hours and we worked through it step by step and we made some great progress," the governor said during a morning news conference in Los Angeles. "So we feel like if we do that two more times like that, I think we can get there ... before Christmas Eve or Christmas Day."

The thaw didn't last long, as legislative leaders later in the day criticized Schwarzenegger and indicated their work was done until the start of the new year.

The governor faulted lawmakers for "failing to take real action" in addressing the state's budget deficit but said he will continue working with them on a solution that includes spending cuts, new revenue and an economic stimulus plan.

Assembly Speaker Karen Bass responded by suggesting the governor should sign an $18 billion package Democrats sent to him last week containing both cuts and tax increases.

"The single biggest roadblock to having construction on the 405 (freeway) move forward is Arnold Schwarzenegger," said Bass, a Los Angeles Democrat.

Republicans, meanwhile, said they would not negotiate on a deal they believe to be illegal. The Democratic plan was pushed through on a simple majority vote, not the usual two-thirds vote for tax increases, which would require some GOP support.

"We cannot be a part of negotiating an illegal tax increase package that is a blatant attempt to silence California voters," Assembly Minority Leader Mike Villines, R-Clovis, said in a statement.

source

SACRAMENTO, Calif. – California's chief financial officer warned Monday that the state would run out of money in about two months as hopes of a Christmas budget compromise melted into political finger-pointing by the end of the day.

sodbuster wrote:Well I think if the whole country comes togethor we can work our way out of this mess..

sodbuster wrote:But it won't happen unless we put aside the partisan bickering and naysaying.

The mountains and mountains of debt coupled with the fiat currency are crippling our nation. What do Obama and/or the Democratic majority in Congress plan to do about addressing those critical issues.

Like Many States, Ohio Reaches for A Lifeline
Official Says Stimulus Is 'Essential to the Salvation of America'

By Peter Slevin
Washington Post Staff Writer
Saturday, December 27, 2008; A01



COLUMBUS, Ohio -- As the economy sputters and tax revenue plummets, governors and mayors across the United States are lining up to ask President-elect Barack Obama and the new Congress for hundreds of billions of dollars to plug holes in their budgets, arguing that services will suffer and joblessness will rise if Washington does not come to the rescue.

In Ohio, which has shed 100,000 jobs in the past year, Gov. Ted Strickland (D) and his budget team spend a lot of time delivering bad news to constituents and plotting ways to wring money from the federal government. He announced $640 million in cuts for the budget year ending June 30, for a total of $1.9 billion since the economic crisis began.

"We're not crying wolf. This is real," Strickland said in an interview in his statehouse office, pointing to charts that project the most serious erosion of state income in 40 years and a two-year budget deficit of $7.3 billion. Revenue shortfalls in the upcoming two-year budget could amount to about 25 percent of the state's discretionary spending.

Strickland recently picked up the telephone and called Rahm Emanuel, the incoming White House chief of staff. When he heard the recorded voice of his former congressional colleague, he left a message: "Rahm, it's Ted. You've never failed me and I need $5 billion."

Obama has promised money, contending that the need for a stimulus justifies an expansion of the record federal deficit. Vice President-elect Joseph R. Biden Jr. last week promised a down payment on a middle-class tax cut, plus spending to improve roads, bridges and water systems. He called the package the new administration's "most urgent order of business."

"There is no question about it," said John Habat, a budget specialist at Cleveland's Center for Community Solutions. "At this point in the financial crisis, federal aid is the only lifeline left for Ohio."

As negotiators prepare to gather shortly after New Year's Day to weigh competing claims and figure out what could work, months of worsening news has expanded the sense of urgency in Ohio, while limiting hopes that an infusion will do much to brighten the economy. Strickland said the stimulus is foremost a matter of stopping the bleeding.

Many things Ohio spends money on are becoming more expensive, Medicaid most prominently. In the 2007 budget year, Medicaid costs devoured 24.2 percent of the state's general fund, or $4.3 billion. Four years earlier, the figures were 20.5 percent and $3.7 billion. While Strickland hopes a 6 percent increase in Medicaid will be part of a federal stimulus package, the relentless math of a balanced-budget mandate forces cuts.

One emblematic conundrum was the decision to rescind a $930,000 annual tobacco settlement grant from 16 central Ohio centers where 1,100 smokers got help quitting last year.

"We're going to have a long-term impact of sicker people who are going to need increased Medicare and Medicaid, which the state will pay," warned Marie Collart, president of the nonprofit Breathing Association, who recognized Strickland's dilemma and supported his choice. "Yes, we need the money for the stimulus package. Yes, we need the centers to get addicted people off drugs."

Strickland said he and budget director J. Pari Sabety met 15 corporate leaders at the governor's residence this month, "just to pick their brains." The guests favored spending that would produce long-term benefits, from transportation projects and training programs to a campaign to insulate thousands of drafty old homes, reducing energy use and utility bills.

Strickland, who has recently looked for inspiration and historical analogies in Franklin D. Roosevelt's depression-era speeches, is preparing a pitch for three chunks of money for the states.

First, he is angling for a $250 billion increase in federal payments for food stamps and Medicaid, the government health program for impoverished Americans and, increasingly, the working poor. Second, he favors a $250 billion national investment in infrastructure projects. Ohio has a list of "shovel-ready" projects, including roads, water and sewer improvements and "green economy" investments.

more here

sodbuster wrote:Well Steph I hate to be the bearer of bad news but your party was in charge while the bulk of the national debt was incurred.

while pretending that Bill Gates and Warren Buffett and the other richest 1% will pay for them.