| As expected, it was impossible to get 2/3 of the California state government to agree to anything, and so next Wednesday, they're out of cash. From State Controller John Chiang: [He] described the state's money troubles as unlike anything "since the Great Depression," with an anticipated $2.8-billion shortfall in July that could grow to $6.5 billion by September.
"IOUs are almost an admission of guilt that we can't pay our bills," said Garin Casaleggio, Chiang's spokesman.
Without a budget solution, the controller expects next month to issue more than $3 billion in IOUs to some of the state's most vulnerable citizens. Those would include the aged, blind and disabled, college students who receive state grants, welfare recipients and patrons of regional centers for the developmentally disabled.
It's a big deal if your total income is in the form of an IOU as it easily could be for the elderly, blind, disabled and welfare recipients. Since many of these people don't have credit cards, they are going to have a lot of trouble doing things like paying rent, buying medicine and groceries, paying utility bills, etc. This will certainly hurt the bottom lines of the businesses these folks support. County programs which could potentially fill the gap are hurting, too. Los Angeles County officials said IOUs would delay nearly $645 million expected by the end of September -- a shortfall the county can't cover.
When I was a kid, there was this show called Star Trek. In that world, there was no money. Works well in a co-operative society, but it's not going to play in a capitalist society. Ever since the warnings came out about California's finances last winter, it's been an incredibly-slow train wreck that's hard to take one's eyes off. For all the political and philosophical discussions about increased taxes and decreased services, it is always the people least able to fend for themselves who fare the worst. |
