Obama and money

Unless the California legislature finds a way to balance the state’s budget today (July 1st) everyone who receives money from the state, state employees, contractors, welfare recipients, etc., will receive IOUs in their pay envelopes instead of money. Why? Because the California Constitution requires (demands) a balanced budget every year.

Why the state budget got out of whack is explained very well by Associated Press Writer Eric Carvin in an article published in the Southern Ledger titled: Meltdown 101: California’s budgetary troubles.

Mr. Carvin explains that one thing that got California in trouble in the first place was:

“Lawmakers and voters have agreed to higher levels of spending over the years without identifying a dedicated funding source. Over time, that means the state’s general fund has had more obligations than it can afford to pay.”

Requiring a balanced budget, as the California Constitution does, is a great thing but electing irresponsible lawmakers, as California apparently has done, is the worst way to meet that Constitutional requirement.

Gov. Arnold Schwarzenegger wants to solve the problem by cutting spending, say what you want about the “Governator” but he is a very logical thinker; according to Mr. Carvin’s article, the governor wants to cut $16 billion from state programs, borrow $2 billion from local governments and borrow about $6 billion from other government accounts. It’s not a solution but a stop-gap measure.

The Democratic majority in California’s legislature however have a typical Democratic resolution to the problem in mind; from the article:

“Democrats have countered with $11 billion in cuts and nearly $2.5 billion in higher taxes, primarily on tobacco products and companies that drill for oil in California. They also want a $15 increase in the vehicle registration fee, which already was raised earlier this year, to ensure that state parks remain open.

“Schwarzenegger and Republican lawmakers have steadfastly refused to raise taxes after the state Legislature approved nearly $13 billion in higher sales, personal income and vehicle taxes earlier this year.”

Kudos to the governor and the Republican’s who refuse to raise taxes any more than they have.

Shift focus for a second to Washington DC and think about what the President is doing with the Federal budget. Rather than proposing massive budget cuts like Governor Schwarzenegger has done, or any responsible president would have done, President Obama is on a spending spree. He’s putting the country trillions of dollars in debt and why not — he can do something that no governor can do — he can print money. Of course that makes our money worth much less — and by the time he’s through — unless the congress or us voters give him a swift kick in the rear and bring him to his senses — our money may be completely worthless. I guess the president plans to worry about that later.

Since January I’ve been wondering if an individual can secede from the union.

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