.
Our "elite" won't face up to the fact that CA is the harbinger of our Third World future.
Short list.
I'll go out on a limb and predict that most of these bonds will fail and we will see big tax increases by summers end because prop 56 passes. Arnold will declare a "Emergency" and sign them...
So why vote for it? They'll still need to cut spending to balance the budget. There's no smoke and mirrors left to dodge the difficult decisions in California any more - its crunch time!
So how come the analysts don't address what will happen if the bond doesn't pass?!
And here is an article from Forbes.
http://www.forbes.com/markets/newswire/2004/01/12/rtr1208061.html Wall Street cautiously welcomes California budget
Reuters, 01.12.04, 9:40 PM ET
SAN FRANCISCO, Jan 12 (Reuters) - Credit ratings agencies on Monday praised Gov. Arnold Schwarzenegger's austere budget as a step toward solving California's chronic fiscal problems, but cautioned that much hinges on the veteran showman's ability to sell a $15 billion bond plan to voters.
If voters fail to approve that long-term bond, California lawmakers could be thrown back to the political deadlock that Schwarzenegger has vowed to break -- facing either deeper spending cuts that Democrats will not support or tax hikes the Republican governor has rejected, analysts and investors said.
Steve Zimmermann, a managing director at Standard & Poor's, said the budget plan, which must be backed by two thirds of the Democratic-controlled legislature, represented a step toward resolving California's looming deficits over coming years.
"This budget, if adopted, would be movement toward structural balance through cuts," Zimmermann said.
But passing the $15 billion bond is crucial for the state, which would otherwise face the prospect of trying to roll over $14 billion in short-term debt, Zimmermann and others said.
If both major bond proposals are blocked at the ballot box or by the courts, officials have said California will run out of cash in June.
Stephen Moore, a senior fellow with the Cato Institute and member of the governor's budget audit team, said : "None of us want to borrow, but we definitely think borrowing is a superior alternative to raising taxes. Borrowing is the least bad alternative."
Tim Blake, a senior analyst at Moody's Investors Service said the one-time fixes in Schwarzenegger's budget plan point to a massive problem that cannot be solved in a year.
But he added Moody's was not "critical" of the stop-gap measures given the severity of California's fiscal problems, which spurred the agency to cut the state's credit rating in December. (Additional reporting by Michael Kahn in San Francisco)