Hey, what a surprise! The Bluest of the Blue States (you know, the one I live in) is about to go broke:

California lawmakers just got a Henry Paulson-like ultimatum from state officials: If they don't act, the state could be forced to suspend road, bridge, and other public-works projects as early as next week. Come March, California will be out of cash for even day-to-day operations.

A confluence of the national recession and years of legislative budget games is squeezing the Golden State as never before. Although it's not the largest budget gap the state has ever faced, this time it will be harder for California to get help from private lenders. Standard & Poor's now ranks it lower than any other state except Louisiana, which shares the same rating.

The question is: Will lawmakers finally make the tough budget decisions they've put off for so long?

Um, based on the results of a joint session of the Legislature I'm guessing the answer is no.

During the joint session, members listened attentively, but their questions and statements afterward didn't reveal much softening of positions. Republicans signaled continued opposition to tax raises, while Democrats stressed they had already countenanced "devastating spending cuts" and some new revenue was needed. Democrats are a few seats shy of a full two-thirds majority needed to pass a budget on their own.

"It's not clear what my colleagues on the other side of the aisle want," said Karen Bass (D), speaker of the state Assembly, who helped organize Monday's joint session.

Well, if you need me to spell it out for you, Karen, some more "devastating" spending cuts would be good. Or, and hear me out, since this is a little crazy, you could cut taxes.  That could put more money in the hands of California's consumers and business owners. You know, money that they could spend, invest, or use to hire new employees.  Money that would circulate through the state, generating new tax revenues.

Yeah, who am I kidding?  Hello, tax hikes!

Posted by: Sean M. at 05:53 AM | Comments (4) | Add Comment
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