A $40 Million a Day Habit
by Jeff Davis
I don’t think there can be any more doubt: California is definitely going to be the first state to go down, the first state to just plain run out of money. You wonder how long they can keep this juggling act going?
The San Francisco Gate web site reports: “California borrows $40M a day to pay unemployment… California is borrowing billions of dollars from the federal government to pay unemployment insurance. The Los Angeles Times reports that the state owes $8.6 billion already, and will have to come up with a $362-million payment to Washington by the end of next September. The continued borrowing means federal unemployment insurance taxes are going to increase… California tops the list of 32 states that have borrowed a total of $41 billion to pay claims.The state took out its first loan from the federal government early last year, to deal with rising payment of benefits and number of claims.”
Governor Schwarzenegger put furloughs into effect and fought a legal battle so that he could put hundreds of thousands of state workers on minimum wage if necessary. A number of rest stops along I-5 have been shut down due to a lack of funds. This obviously creates a serious public danger since truckers need places to pull over when they start to get drowsy. Schwarzenegger hit the point where he simply had to start slashing spending on things like welfare and benefits for the millions of illegal aliens and the bloated state employees’ and unions’ pensions, and he blinked.
Obama and Ben Bernanke bailed him out with some of the $500 billion dollars the Federal Reserve just printed. Already that $500 billion in “quantitative easing” has begun to act as an effective devaluation of the dollar, and by raising the price of imported crude oil we have to pay, the effect is beginning to be seen in rising gasoline prices. Now, that’s just what we need for the coming holiday season.
That “one in eight workers unemployed” would go down, of course, if California were to take some serious steps to reduce the number of illegal aliens, especially in Los Angeles. One news article notes “…the current fiscal cost outlays for the illegal alien population in California are now approaching $13.1 billion annually more than half the projected (state budget) shortfall for next year.” The crazy legislature in California unfortunately would rather protect illegal aliens from deportation, than assist in deporting the illegal aliens, who are helping to bankrupt the state.
