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California Controller John Chiang, a Democrat, warned last week that the state was "less than 50 days away from a meltdown of state government."
The administration is worried that California will enact massive cuts to close its deficit, estimated at $24 billion for the fiscal year that begins July 1, aggravating the state's recession and further dragging down the national economy.
After a series of meetings, Treasury Secretary Timothy F. Geithner, top White House economists Lawrence Summers and Christina Romer, and other senior officials have decided that California could hold on a little longer and should get its budget in order rather than rely on a federal bailout.
Substitute "California" for "GM" and it sounds like the same, sad story.
Too big to fail. I think Arnie is going to call their bluff and I think the Fed gov't will step in on 7/1.
The Fed can't let states default; whatever foreign investment is left will flee and that puts the Fed in danger. IMO..Arnie can't lose on this by holding out.
Ok, let me get this straight. Congress wants to hand over billions to the IMF for a "world bailout," but California gets the rebuff?
Make no mistake, i'm no handout junkie by any stretch of the imagination, but it seems to defy logic that we'd let one of our own suffer while spending our tax money on other countries?
Ok, let me get this straight. Congress wants to hand over billions to the IMF for a "world bailout," but California gets the rebuff?
Make no mistake, i'm no handout junkie by any stretch of the imagination, but it seems to defy logic that we'd let one of our own suffer while spending our tax money on other countries?
They could also put off this big healthcare reform for a year and use that to help the states.
They could also stop sending billions to Iraq each month and help the states.
There's a lot the fed government could do to help the states but they choose not to.
I say this because while California may be in the spotlight today..they are the first and won't be the last to have these fiscal problems.
snippets:
"...the California budget crisis may well lead to a second financial calamity that would be far worse than anything experienced over the past 18 months.
..
So if the unofficial eighth-largest economy fails on its debt, might the debt for the largest economy go with it?
..
The Democrats have controlled the California legislature for most of the past four decades. In spite of protestations by the occasional powerless Republican governor, the Democrats adopted economic policies that define left-wing nirvana.
..
California is in crisis because state spending is so high that even those hefty taxes aren’t enough to balance the budget. "
maybe california doesn't get the money because they want to see a republican governor sweat .....
So if the Obama Administration doesn't give California money, it's because of anti-Republican motives, and if they do, it's because they're favoring a Democratic state?
Location: The Chatterdome in La La Land, CaliFUNia
39,031 posts, read 23,023,210 times
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Quote:
Originally Posted by HappyTexan
Substitute "California" for "GM" and it sounds like the same, sad story.
Too big to fail. I think Arnie is going to call their bluff and I think the Fed gov't will step in on 7/1.
The Fed can't let states default; whatever foreign investment is left will flee and that puts the Fed in danger. IMO..Arnie can't lose on this by holding out.
I personally find it ironic about how the Feds can bail out the banks and auto makers but are not willing to bail out one of its own states. Many of Californias public employees are facing layoffs and my job is iffy but I guess I can fork over my tax dollars to bail out private corporations.
Ok, let me get this straight. Congress wants to hand over billions to the IMF for a "world bailout," but California gets the rebuff?
California doesn't count because there is no way it can distribute "dollars" to foreign governments and banks like the IMF can.
Obama cares more for the "dollar" and it's #1 position in the world, than he ever could or will, about the states or the people in those states.
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