California's Economy: Disaster Developing 31 comments
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As each day goes by, the efforts by the “Governator”, Arnold Schwarzengger to avoid the bankruptcy of California appear ever more to be ½ wishful-thinking, and ½ fraudulent accounting.
Let's start with the basic reality: there is zero possibility of California surviving this bankruptcy crisis (by itself) without raising taxes to bring in more revenue. However, Schwarzenegger has already stated there is zero possibility of him signing any budget which contains tax increases.
Yet, while Schwarzenegger will do nothing to increase state revenues, he has had the audacity to announce he will attempt to sell a $6 BILLION “revenue anticipation warrant”. In other words, with a current budget shortfall of over $15 BILLION, after doing as much cost-cutting as possible, he is committing his future replacement as governor to come up with an extra $6 billion (plus interest) to fund California's current bankrupt operations.
This comes with the state economy, and state revenues still hurtling downward – as befits the “Greater Depression” which the U.S. is currently experiencing.
Another one of Schwarzenegger's brilliant “solutions” is to sell off aging, obsolete state facilities, with the two examples (mentioned in a Reuters article) being the Los Angeles Coliseum and San Quentin prison.
Why would any sane investor with enough capital to purchase a stadium wish to do so in a bankrupt state, where the population has been impoverished to such a degree that even sporting events will not be spared huge drop-offs in attendance?
Perhaps the San Quentin sale makes a lot more sense. With massive over-crowding in California prisons, that treat the inmates worse than most livestock, and currently violate laws on the minimum standards of care for prisoners, unloading this “asset” would be a wise move.
Once San Quentin becomes a “private prison”, then the government can simply ignore the sub-human treatment provided to inmates in private prisons across the U.S. (one of the only “growth industries” in America). The sadists who assume control of San Quentin can then just stop feeding the prisoners, eliminating “budget problems” and over-crowding – simultaneously.
For those who think my pronouncement on California's “economic health” (or more properly its “lack of health”) is overly harsh, here are a couple of quotes.
Larry Gerston, political scientist, San Jose State university:
[Schwarzenegger's policies amount to a choice between] Armageddon and Armageddon-lite. At this point, if we're not talking about a doomsday scenario, we're getting pretty close.
Tom Tarabicos, financial advisor, Covenant Wealth Group:
I have sold all of my clients' municipal bonds related to the state of California and any of its municipalities...A real disaster is developing in California...We're putting California on the same level as Detroit. [It doesn't get any worse than that!]
Regular readers will recall that I have been predicting exactly such an economic meltdown (see Feb.17: “California government lays-off 20,000 as FIRST step in crisis”). The combination of a relentless collapse in revenues, along with the repeated lies of Ben Bernanke that a “recovery is on the way” has caused states and municipalities across the U.S. to begin preparing for this “Greater Depression” much too LATE.
Robbing over $6 billion from future state revenues to temporarily prop-up California's financial 'house of cards' solves nothing – it only guarantees an even greater fiscal crisis (i.e. bankruptcy) months down the road.
Ultimately, as I have repeated over and over, the only way to avoid a domino-like chain of bankruptcies in cities, towns and states across the U.S. is for the U.S. government to come up with yet more trillions to plug the gaping chasms in these budgets.
It is now past the point where U.S. politicians can continue to “deal with” this crisis by simply using lies (and more reckless borrowing) to stall for time.
The Soviet Union never believed it could ever go bankrupt, either.
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check out united states justice foundation.
My CA cousins would often joke that it would be better for Californians to leave the union since their state's GDP was consistently higher than all the Southern states combined and the biggest contributor to America's output. Perhaps a slight exaggeration, but nevertheless CA's economic power cannot be dismissed. Having said that, of course you are absolutely correct in your analysis that there is a real danger of the State's government going bankrupt - and that has been the case for awhile now.
I have to admit that for the last 3-4 years I have been quietly admiring the glossy CA government websites offering CA municipal bonds offering tax breaks which would be attractive to the highest earners resident in the state. A nice civic idea, I thought at the time. But there's something I had to get my head around when I tried to understand my cousins and the state of California's public services, utilities and roads: They don't give a damn. They have no sense of civic pride, responsibility, or duty unless it's being fronted by a celebrity, or it's right outside their front door. The people I have met there consistently exhibited that peculiar American trait which most Europeans cannot understand: self-reliance and selfishness (aka "individual freedom") even when it is patently clear that it will be detrimental to their society and quality of life as a whole, even when it is economically prudent to do things collectively. As long as their community is "gated", they have private security, & the roads they use (And nobody else's) can be driven on, THEY DON'T CARE. Really. Drive just a few hundred yards out of the manicured neighbourhoods, and the roads become impassable. Potholes the size of trucks line the roads, and god help you if you accidentally wander into gang territory.
Don't get me wrong, it's really quite lovely where people who work hard for their money live, but asking Californians (Or most other Americans, for that matter) to CARE about other people's lives, the state of the prisons, the state of other people's roads, homes, or security will be met with very blank stares indeed. If/When it does all go wrong, and there's no police, no social services, and criminals roam the streets, they will simply build higher walls around their gated communities, hire private security, and buy bigger guns, to protect their manicured lawns. That scenario already sounds vaguely familiar in some parts.
So California's bankruptcy may be inevitable, but believe me nobody there will be able to envision the consequences of that event, nor care beyond what happens on their doorsteps.
It will dry up and the printing of money will continue until they have to devalue the dollar and the American people will lose another chunk of their savings.
The question is not if this will happen, but when.
Then the chaos and anarchy really begin.
money as though the state can print up extra dollars. The
fiscal dire straits don't seem to matter to them. If the governor
had his way in trimming the budget in his first couple of years
in office, we would not now be in this crazy situation.
On May 17 10:55 AM Gandma Moses wrote:
> This is one of the most biased, infantile and naive article I have
> ever seen. Not only does this author have no sense of California
> politics, he has no sense of California history either. The financial
> problems were in place long before Arnold took over (thanks to Gray
> Davis and the liberal legislature who buy votes from the the least
> productive members of society with other people's money), but there
> is nothing he could do can stop them from recurring (and he has tried
> everything) thanks to the continuing obstructionist policies of the
> state assembly, controller and everyone else.
Or maybe the rest of the U.S. could just give the whole lala land to Mexico. That might be cheaper than bailing them out and we couild also get rid of Nancy that way. A win-win deal all around.
WELL, I AM IN FLORIDA AND HOPE IT DOESN'T HAPPEN HERE, BUT I AM WATCHING WITH HESITATION THE CALIFORNIA ECONOMIC SITUATION.
ALL WE CAN DO HERE IN FLORIDA IS LOOK AT OUR MONEY AND READ, "IN GOD WE TRUST."
There was a "typo" in one of your comments, however. It should have read, "we could RETURN the whole lala land to Mexico."
On May 17 02:06 PM henarl wrote:
> Perhaps California could sell San Quentin and other state prisons
> to Mexico. A large percentage of inmates are their nationals anyway
> and they could run the prisons like they do their own in Mexico.
> Probably would cut down on recidivism that way too.
> Or maybe the rest of the U.S. could just give the whole lala land
> to Mexico. That might be cheaper than bailing them out and we couild
> also get rid of Nancy that way. A win-win deal all around.
On May 17 01:49 PM Valley Boy wrote:
> You have it exactly right. The state legislature keeps spending
>
> money as though the state can print up extra dollars. The
> fiscal dire straits don't seem to matter to them. If the governor
>
> had his way in trimming the budget in his first couple of years<br/>in
> office, we would not now be in this crazy situation.
Also we need to follow the Russian Model of supplying Oil and CNG and raw materials to the world.We sent our industry somewhere decades ago and stopped offshore drilling which was offensive to the population of Santa Barbara.
As a native of San Diego, California I remember Convair and General Dynamics, also GM made cars in the San Fernando Valley, another company made air planes in Long Beach area, San Francisco had shipping and fishing,we made tires and so forth.
Then everything with manufacturing became offensive although it was part of the Golden State's success along with agriculture and education and medicine and research. Oh yes, Chevron , Occidential etc produced oil and refined gas products which we bought.
You know the rest.
We send our dollars to the middle east. No one graduates from our schools. We have loads of social services. We have a mall on every block. But our air is cleaner. I do not go to the beach because highways are crowded, and I have to work to pay a mortgage .
The economy is out of balance. Terminate all state government elected representatives who have a 2 nd job or corporation. Cut salaries for state employees back to 1987 levels.
Sell off schools -do not rebuild them. Move children into the vacant malls and use computers from Apple and other Silicon Valley companies. Place best teachers on line, fire the rest.
Bring oil and gas exploration companies in and drill everywhere. Sell oil and CNG to the world. Make deals with drillers and a new refiner to supply a portion of revenues to California transportation Fast rail -TGV- from Silicon Valley to LA via the Fresno, Merced, Visalia , Bakersfield to Burbank route(or Lancaster or Ventura).
Confiscate Bill Gate's fortune before it is to late and he gives it to Bangladesh, Burma, Pakistan or some crazy place.
CAlifornia allowed Microsoft to make a fortune. Now take it from him- his Vista software sucks....
Oh yes, sell legal marijuana once a year in California. A Pack of ten joints for $400.00 US Dollars. That will supply some treasury money.
Outlaw social spending for 5 years. Only spend for construction of drilling, refining, natural gas exploration, require car manufacturers to supply CNG engines made in California for their cars sold in California.
Make all students work for 2 years in a California agency(prison or schools or medical care or teach science and business and alternative energy) or 2 years of mandatory military service and/or 2 years of working in state run compressed gas/hydrogen service stations.
We are not thinking. Oh yes. Put Nancy Pelosi on a far away island with SEC enforcement officiers and investment banks staffs and senior board members and the Fannie and Freddie people for 3 years of education(Gitmo-comes to mind).
On May 17 02:32 PM Richard R. Roehl wrote:
> I strongly suspect that Ronald Reagan's elitist "trickle down" mindset
> (rich folks urinating on poorer folks) planted the poisonous $eeds
> for California's demise.
On May 17 06:53 PM Diegojames wrote:
> Perhaps the US Treasury will bailout California with the help of
> Canada and its banking system. And if Canadians come to San Diego
Amazing how trillions of dollars have been kept off the books by this method. All 50 state governors know this and are in on the scam. If I'm wrong, let me know! Tomcares@verizon.net.
Tom
tompetrie.net
A “SINGLE VOICE PROJECT” is the official name of the petition sponsored by: The National Public Service Council To Abolish Private Prisons (NPSCTAPP)
THIS PETITION SEEKS TO ABOLISH ALL PRIVATE PRISONS IN THE UNITED STATES, (or any place subject to its jurisdiction)
The National Public Service Council To Abolish Private Prisons (NPSCTAPP) is a grass roots organization driven by a single objective. We want the United States government to reclaim sole authority for state and federal prisons on US soil.
We want the United States Congress to immediately rescind all state and federal contracts that permit private prisons “for profit” to exist in the United States, or any place subject to its jurisdiction. We understand that the problems that currently plague our government, its criminal justice system and in particular, the state & federal bureau of prisons (and most correctional and rehabilitation facilities) are massive. However, it is our solemn belief that the solutions for prison reform will remain unattainable and virtually impossible as long as private prisons for profit are permitted to operate in America.
Prior to the past month, and the fiasco of Fannie Mae, Freddie Mac, AIG, Lehman Brothers, and now the “Big Three” American Automobile manufacturers, the NPSCTAPP has always felt compelled to highlight the “moral Bottom line” when it comes to corrections and privatization. Although, we remain confounded by the reality that our government has allowed our justice system to be operated by private interests. The NPSCTAPP philosophy has always been “justice” should not be for sale at any price. It is our belief that the inherent and most fundamental responsibility of the criminal justice system should not be shirked, or “jobbed-out.” This is not the same as privatizing the post office or some trash pick up service in the community. There has to be a loss of meaning and purpose when an inmate looks at a guard’s uniform and instead of seeing an emblem that reads State Department of Corrections or Federal Bureau of Prisons, he sees one that says: “Atlas Prison Corporation.”
Let’s assume that the real danger of privatization is not some innate inhumanity on the part of its practitioners but rather the added financial incentives that reward inhumanity. The same logic that motivates companies to operate prisons more efficiently also encourages them to cut corners at the expense of workers, prisoners and the public. Every penny they do not spend on food, medical care or training for guards is a dime they can pocket. What happens when the pennies pocketed are not enough for the shareholders? Who will bailout the private prison industry when they hold the government and the American people hostage with the threat of financial failure…“bankruptcy?” What was unimaginable a month ago merits serious consideration today. State and Federal prison programs originate from government design, and therefore, need to be maintained by the government. It’s time to restore the principles and the vacated promise of our judicial system.
John F. Kennedy said, “The time to repair the roof is while the sun is shinning”. Well the sun may not be shinning but, it’s not a bad time to begin repair on a dangerous roof that is certain to fall…. because, “Incarcerating people for profit is, in a word WRONG”
There is an urgent need for the good people of this country to emerge from the shadows of cynicism, indifference, apathy and those other dark places that we migrate to when we are overwhelmed by frustration and the loss of hope.
It is our hope that you will support the NPSCTAPP with a show of solidarity by signing our petition. We intend to assemble a collection of one million signatures, which will subsequently be attached to a proposition for consideration. This proposition will be presented to both, the Speaker Of The House Of Representatives (Nancy Pelosi) and the United States Congress.
Please Help Us. We Need Your Support. Help Us Spread The Word About This Monumental And Courageous Challenge To Create Positive Change. Place The Link To The Petition On Your Website! Pass It On!
The SINGLE VOICE PETITION and the effort to abolish private “for profit” prisons is the sole intent of NPSCTAPP. Our project does not contain any additional agendas. We have no solutions or suggestions regarding prison reform. However, we are unyielding in our belief that the answers to the many problems which currently plague this nation’s criminal justice system and its penal system in particular, cannot and will not be found within or assisted by the private “for profit” prison business. The private “for profit” prison business has a stranglehold on our criminal justice system. Its vice-like grip continues to choke the possibility of justice, fairness, and responsibility from both state and federal systems.
These new slave plantations are not the answer!
For more information please visit: www.npsctapp.blogspot.com or email: williamthomas@exconcil...
To sign the petition please visit: www.petitiononline.com...
THANK YOU FOR YOUR SUPPORT!
William Thomas
National Community Outreach Facilitator
The National Public Service Council To Abolish Private Prisons
P.O. Box 156423
San Francisco, California 94115
As a Canadian, I find the IDEA of "private prisons" a very dubious proposition. However, allowing these facilities to "mushroom" all over the United States with lax standards and virtually no oversight is simply appalling.
It clearly has no place in the 21st century - in a supposedly civilized society.
On May 18 10:01 AM Strayarts wrote:
>
> A “SINGLE VOICE PROJECT” is the official name of the petition sponsored
> by: The National Public Service Council To Abolish Private Prisons
> (NPSCTAPP)
>
> THIS PETITION SEEKS TO ABOLISH ALL PRIVATE PRISONS IN THE UNITED
> STATES, (or any place subject to its jurisdiction)
>
>
> The National Public Service Council To Abolish Private Prisons (NPSCTAPP)
> is a grass roots organization driven by a single objective. We want
> the United States government to reclaim sole authority for state
> and federal prisons on US soil.
> We want the United States Congress to immediately rescind all state
> and federal contracts that permit private prisons “for profit” to
> exist in the United States, or any place subject to its jurisdiction.
> We understand that the problems that currently plague our government,
> its criminal justice system and in particular, the state & federal
> bureau of prisons (and most correctional and rehabilitation facilities)
> are massive. However, it is our solemn belief that the solutions
> for prison reform will remain unattainable and virtually impossible
> as long as private prisons for profit are permitted to operate in
> America.
>
> Prior to the past month, and the fiasco of Fannie Mae, Freddie Mac,
> AIG, Lehman Brothers, and now the “Big Three” American Automobile
> manufacturers, the NPSCTAPP has always felt compelled to highlight
> the “moral Bottom line” when it comes to corrections and privatization.
> Although, we remain confounded by the reality that our government
> has allowed our justice system to be operated by private interests.
> The NPSCTAPP philosophy has always been “justice” should not be for
> sale at any price. It is our belief that the inherent and most fundamental
> responsibility of the criminal justice system should not be shirked,
> or “jobbed-out.” This is not the same as privatizing the post office
> or some trash pick up service in the community. There has to be a
> loss of meaning and purpose when an inmate looks at a guard’s uniform
> and instead of seeing an emblem that reads State Department of Corrections
> or Federal Bureau of Prisons, he sees one that says: “Atlas Prison
> Corporation.”
>
> Let’s assume that the real danger of privatization is not some innate
> inhumanity on the part of its practitioners but rather the added
> financial incentives that reward inhumanity. The same logic that
> motivates companies to operate prisons more efficiently also encourages
> them to cut corners at the expense of workers, prisoners and the
> public. Every penny they do not spend on food, medical care or training
> for guards is a dime they can pocket. What happens when the pennies
> pocketed are not enough for the shareholders? Who will bailout the
> private prison industry when they hold the government and the American
> people hostage with the threat of financial failure…“bankruptcy?”
> What was unimaginable a month ago merits serious consideration today.
> State and Federal prison programs originate from government design,
> and therefore, need to be maintained by the government. It’s time
> to restore the principles and the vacated promise of our judicial
> system.
>
>
>
> John F. Kennedy said, “The time to repair the roof is while the sun
> is shinning”. Well the sun may not be shinning but, it’s not a bad
> time to begin repair on a dangerous roof that is certain to fall….
> because, “Incarcerating people for profit is, in a word WRONG” <br/>
>
> There is an urgent need for the good people of this country to emerge
> from the shadows of cynicism, indifference, apathy and those other
> dark places that we migrate to when we are overwhelmed by frustration
> and the loss of hope.
> It is our hope that you will support the NPSCTAPP with a show of
> solidarity by signing our petition. We intend to assemble a collection
> of one million signatures, which will subsequently be attached to
> a proposition for consideration. This proposition will be presented
> to both, the Speaker Of The House Of Representatives (Nancy Pelosi)
> and the United States Congress.
>
>
> Please Help Us. We Need Your Support. Help Us Spread The Word About
> This Monumental And Courageous Challenge To Create Positive Change.
> Place The Link To The Petition On Your Website! Pass It On!
>
> The SINGLE VOICE PETITION and the effort to abolish private “for
> profit” prisons is the sole intent of NPSCTAPP. Our project does
> not contain any additional agendas. We have no solutions or suggestions
> regarding prison reform. However, we are unyielding in our belief
> that the answers to the many problems which currently plague this
> nation’s criminal justice system and its penal system in particular,
> cannot and will not be found within or assisted by the private “for
> profit” prison business. The private “for profit” prison business
> has a stranglehold on our criminal justice system. Its vice-like
> grip continues to choke the possibility of justice, fairness, and
> responsibility from both state and federal systems.
> These new slave plantations are not the answer!
>
> For more information please visit: www.npsctapp.blogspot.com
> or email: williamthomas@exconcil...
> To sign the petition please visit: www.petitiononline.com...
>
>
> THANK YOU FOR YOUR SUPPORT!
>
>
>
> William Thomas
> National Community Outreach Facilitator
> The National Public Service Council To Abolish Private Prisons<br/>P.O.
> Box 156423
> San Francisco, California 94115
>
>
>
>
>
>
>
>
>
>
>
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