JUNE 9, 2009: Just Another Day In Denial?

The June 15th deadline for our legislature to pass a budget is looming. According to our California Constitution (article IV, section 12C), the budget is do by Monday at midnight, which is less than a week away. Where are the air-raid sirens and the red warning lights flashing throughout the state?   California is ablaze and it’s business as usual.

Controller John Chiang tried to light a fire under the feet of the Legislature and the Governor by sending them what amounts to a doomsday letter on May 29th. Chiang warns of the of the states latest cash projections which show the state flat broke on July 29th and the need to sell “Revenue Anticipation Warrants” (RAW), which amount to IOU loans needed to keep the state running.  If a budget is not passed by the June 15th deadline not only will we be just about out of cash but the Controllers ability to obtain the RAW loans becomes all but impossible.    

In an effort to find out what happens if the deadline is not met, I called the Controllers office, where I was referred to the Governor’s office.  Silly me, I thought the chief accountant would be able to answer my questions…. guess not.  Megan, a Governor’s office staff member said, “the Governor is aiming for July 1st” when asked about the June 15th deadline.  It’s nice to know Schwarzenegger is able to so easily disregard the supreme law of our state, it’s Constitution. Megan went on to say “the longer we go the more pressing our problems become and the deeper the cuts will be.  Controller Chiang has said he will again delay payments”.  She added, “We haven’t had a budget passed by the 15th in years.  It’s really up to the Assembly and the Senate”.   I asked about which payments would be delayed and is there an order for which payments will be cut as the budget impasse continues.  I was referred back to Controller’s office, which told me I would need to email my question, as it could not be answered on the call.  I will post their response.

If it has truly become so blasé to brush off the Constitutional deadline and fail to pass a budget before our state sinks into a deficit black hole, you’d think it would be easy to to find out what would happen and how it would happen.  Guess not.

Our whole budget catastrophe is more frustration when you actually watch what’s going on in Sacramento.  The California Channel is currently, as I type this, airing a live feed of the Budget Conference Committee, a dual house committee charged with helping to close our deficit.  This committee is right now taking up budget issues involved with healthcare.  Members are willy nilly about making any entitlement cuts and are entertaining creating various new positions and increasing funding to the state healthcare system.   Big surprise, most of them just don’t get it. This is just another example of why our state is choking to death on debt while it’s Legislature continues to try and be all things to all people.