Fiscal Woes Swamp California

Mirroring the dire fiscal woes of the U.S. government, California, by far the nation's biggest state has through its governor, announced a $16 billion shortfall and without new taxes and/or drastic cuts in spending, has no way to pay for the shortfall.

This means California schools, once the nation's best, face more big cuts, as do lifelines for the elderly, the physically disabled and children in need. Thousands of state workers face cutbacks in work hours or pay cuts, and there would be cuts to the court and prison systems, etc. And that doesn't count all the unfunded pensions and health care obligations California is liable for.

In its finances, the only difference between California's government and the U.S. government is the U.S. government isn't required to balance its budget. For now it can keep borrowing money it has no idea how it will ever pay back and wildly spend it on weapons and wars and anything else it chooses, with no accountability. The U.S. government, its taxpayers and its bondholders (lenders) will face a future day of reckoning.

But for all of its challenges, California remains a vibrant place to live, and it is the home of the Silicon Valley, the global creative capitol, and the home of Hollywood, the global entertainment capitol and its sea ports are the busiest in America. After considerable pain yet to come, such as more job losses, home foreclosures and other terrible events, eventually this state will get back on its feet.

And when it finally does, I hope it becomes a beacon of hope for all of humanity, including its immigrants and helps to lead the nation back to fiscal prosperity and a better future for all of its people.

Dick
To learn more, please see "Brown lists new cuts to close deficit," Los Angeles Times, http://www.latimes.com/includes/sectionfronts/A1.pdf and "Fiscal Woes Boomerang for Brown in Calfornia," The New York Times, http://www.nytimes.com/2012/05/15/us/brown-proposes-8-3-billion-in-cuts-for-california.html?nl=todaysheadlines&emc=edit_th_20120515