The sword of Damocles has fallen; Atlas has dropped the Earth and an earthquake has struck California. Not a seismic earthquake but an economic earthquake.
The reverberations of the collapse of the California real estate market combined with the outsourcing of jobs set into motion the shaking of the state's economic foundations. If you were to see this play enacted in a theater, you wouldn’t believe it. I read it again and again and shake my head at what has become reality in this country. California faces a budget deficit of $26.8 billion dollars in the 2010 state budget.
The Governor has proposed:
A 5% pay cut for state employees; on June 6th the governor described state workers as having "unbelievable benefits."
The complete elimination of the state's welfare-to-work program.
The complete elimination of the state's health insurance program for children; 900,000 children will lose health coverage.
Plans to close 200 state parks.
Elimination of the funding for AIDS counseling.
Reducing state grants to the blind and disabled to federally-mandated minimums.
Reduced funding for in-home care of seniors.
The elimination of 50,000 teaching positions.
The elimination of 5,000 state positions.
An immediate halt in funding of all state contracts, affecting thousands more private sector employees.
The California Senate Democrats offer a counter-proposal of using the state’s rainy day fund to cover some of the shortfall and rolling back various corporate tax breaks. Senate Republican leader Dennis Hollingsworth objected, saying "he could not accept killing tax breaks designed to stimulate the economy.
"When you pull tax credits that are targeted toward creating jobs, it doesn't result in more revenue – it results in less jobs."