SCHADENFREUDE!
Posted on 12/20/2004 9:58:54 AM PST by BurbankKarl
SACRAMENTO — The bills from California's record borrowing binge are coming due, and they are so staggeringly high that financial experts warn paying them back threatens to stall the state's economic recovery.
Creditors are knocking on California's door at the same time the state sorely needs money to undo years of neglect to freeways, schools and water systems.
The state's overall credit card bill now stands at $51 billion, most of it for public works projects to be repaid over several years. A steep run-up, however, came earlier this year with mega-borrowing that voters approved in March to get the current state budget balanced.
(Excerpt) Read more at latimes.com ...
On top of the $51 billion in bonds yet to be repaid, the state has a backlog of $30 billion worth of borrowing that has been approved for things such as school construction, housing and environmental programs but has yet to be sold. The $3-billion measure that voters approved in November to promote stem cell research also is in that pool.
"The state is underwater," said state Treasurer Phil Angelides. "We aren't even bringing in enough money to pay our operational expenses, let alone all the debt service. All the deficit borrowing has put us in a precarious situation. It will make it very difficult to sell bonds for the things that will actually make the state stronger."
Few states have ever taken on such proportionately high levels of debt in their budgets. In the cases of those that have, it almost always involved paying for infrastructure programs that helped drive their economy. That is where California is different. Here, taxpayers borrowed just so the state could keep spending on day-to-day programs without raising taxes.
"California is alone in having taken such actions to close a budget gap," said Arturo Perez, a fiscal analyst with the National Conference of State Legislatures.
"What's in YOUR wallet?"
Bills and receipts........and late notices......and more credit card offers.......
OK, OK, OK - Kaliphornica is a third world nation within the US.
Do we really need more evidence of that?
Does this include the commitment to fund embryonic stem-cell research?
I need %'s. Compared to the income produced in CA what is the level of debt?
It's more like "Who's in YOUR wallet?"
I voted for Arnold (what was the alternative?), but his "plastic" solution was unnecessary, cowardly, and just compounded the problem.
You can't spend yourself out of a huge deficit!
The State's credit rating is lower than a caterpillar with fallen arches, the interest alone is a huge addition to the debt.
It's the SPENDING, stupid!
It's the SPENDING, stupid!
It's the SPENDING, stupid!
It's the SPENDING, stupid!
It's the SPENDING, stupid!
It's the SPENDING, stupid!
But I never thought of them as "pirates". I always thought they were warriors from the middle ages. I guess I could be wrong. Heck, it's not like THAT'S happened before... ;-)
Spending lots and lots of money on everything EXCEPT what government is supposed to do is what is wrong with most states and the federal government. It's going to be very tough to get the genie back in the bottle.
To give him credit, Arnold inherited most of this mess.
The only problem is, he has done absolutely nothing to turn it around. In fact, he has succeeded in making it even worse.
As Bush stands up at his news conference, this morning in D.C. praising illegal aliens, giving millions more the green light to enter our state and our country illegally.
Insane.
Time for Arnie to ask all those Hollywood types to start a Kalifornia Fest with bands like Farm Fest. It won't solve anything but it would sure look like he was doing something.
The more I hear about how CA keeps digging themselves deeper and deeper in debt, and then the rumors start about what it would do to the national economy if they forfeit on the loans makes me think that may be what they are planning. Instead of making the hard choices and gutting the social programs to bring them back maybe they are intentionally going ahead with their wish list. Then they can just throw up their hands and say "Oh well,either the rest of the nation bails us out or we bring their economy down the tubes too." That would force a bail out by Washington because CA is too important to let tank. Of course I know the dims would never do anything like that to get their way, just disregard that train of thought.
Presidents don't spend money. Congress spends money.
Currently 6.2%, and will rise to 7.5% in 2008.
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