California IOUs Due To Be Issued Today,

San Jose Mercury News:

SACRAMENTO -- In a move certain to draw national ridicule and exact financial hardship on business owners and taxpayers across the state, California is slated today to begin paying billions of dollars in bills with IOUs instead of cash.

Nearly 30,000 IOUs totaling more than $53 million are expected to be sent out by state Controller John Chiang this afternoon, the day after Gov. Arnold Schwarzenegger declared a fiscal emergency in the face of a staggering $24.3 billion deficit. The state Legislature remained in its familiar state of gridlock, raising the prospect of an extended standoff that further damages the state's financial reputation.

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Read the whole story: San Jose Mercury News

Comments

[themodernleader]

RogerHWerner. Your request is more than legitimate. I was intending to say that in a rising organization, members in periods of peril are willing to galvanize around a courageous leader. Contrarily, in a declining organization the membership refuse to rally around a courageous or competent administrator when faced with the worst.
This phenomenon of legislatur­e-executiv­e deadlock is happpening in many states throughout our land. We refuse to admit that we are actually bankrupt; therefore, our leaders won't act rationally for fear of being run out of office. The more we procrastinate in addressing our economic decline, the worse our condition as a state of states and country.

[loki]

maybe another country will pick up the mortgage and take it over?

[WorkingClass]

California will soon be dead of political gridlock. All of us have the same problem with the U.S. Senate.

[brownstoness]

FINANCIAL INDEPENDENCE DAY - STARVE THE BEAST

We're udnergoing a delveraging process. Expect the DJIA to bottom at 5000 or lower.

Americans are starting to come to their senses. The savings rate reached 6.9% last month,
the highest level in 15 years. This brought the level up to the long-term average. As usual,
the pundits on CNBC have concluded that now that we've reached the average, everything is
roses and the consumer can resume their free spending ways and save our economy. These fools
have no concept of history, averages or cycles. The savings rate has been in a downward
spiral for 30 years. Consumers have lost $14 trillion of net worth and 5,000 per day turn
65. Most people have miniscule retirement savings and 14.7 million are unemployed. The
savings rate will go up for the next two decades as people must save.

hat tip to: http://iamned.blogspot.com 4 the good articles

[markdavida]

Maybe Israel could loan the state some of the money the Federal Government gave to them; money never to be paid back to the taxpayers of the U.S. nor with any strings attached. How does a completely foreign nation rank higher than U.S. citizens of California? I'm not for bailing out California but if the Federal government is going to waste the money sending it to Israel then I would rather it just be wasted here in the U.S.

[RomeoMD25]

So, what happens when a state becomes a “green” dream like the people advocating for all of this energy control?
Once an economic dynamo that drew people from every state for jobs and a better life,
California is a textbook case for why socialism coupled with false environmentalism cannot work.
Because of its environmental lobby wanting everything to be “green”, California merely imports what it needs from other states,
producing less and less in return. Let someone else produce what we need… This year,
reality finally started shining through the clouds of marijuana smoke with 11.2% unemployment and the Assembly’s budget problems.

[swift goat pet for truth]

So, what do you think about the fact that for every dollar Cal sends the US Government, it gets back 77 cents?

[ejhickey]

Are you suggesting that California would be better off on its own?

[tandrmcdonald]

Anyone in California remember Grey Davis?
Gramma Rose

[jdt67]

"that further damages the state's financial reputation­."

I think that ships has sailed.

[davidwayneosedach]

These IOU's are only the start. Look for massive layoffs and closures. Schwarzenegger is still banking on a Federal bailout.

[lightningbolt]

This is the result of of the republican strategy of destroying governments to decrease taxes and regulation. Anytime a republican is in office, that will be the strategy. Republicans are traitors.

[higgins1990]

Total Democratic control in Sacramento. Always has been. Nice try, though.

[runfastandwin]

24 of the last 29 years have seen republicans in charge, including the last 5 when this mess developed. In fact it was Schwarzenegger, a republican, that started down this road when he called a special election that eviscerated the state's ability to force a balanced budget, and further larded on $22 billion in debt. Nice try, though.

[claudiam]

These elected officials need to get over their ideology and get real. Do what is necessary; it may not popular but this whole country needs to pony up to the bar. I may be liberal but I am also pragmatic. claudiatucsonaz

[mantri]

Simple solution: start paying the CA legislature with IOUs. Then let's see how long it takes them to quit foot-dragging and posturing.­.

[smiththomas]

Everyone must go bankrupt to maintain the living standard of as many teachers, unions and government workers as we can, Its the policically correct thing to do, Get those IOUs issued.

[higgins1990]

Why does the present administration want to follow the example of California? Could anyone explain that to me? Anyone? Hello?

[WorkingClass]

Graft.

[DD1Prime]

If CA continues to need to issue IOUs they should switch to a stronger currency right in their own backyard - Disney dollars.

But seriously - until they repeal the 2/3 majority requirement for passing budgets tax increases, this nonsense will continue.