Arnold has had enough and did what he threatened to do. He's cut pay and laid off enough people to save 100m a month.

It's getting interesting out here, fellas.

I thought his threat was merely political bluster, but it looks like people are going to get terminated after all.

Minimum wage for the time being is better than the IOU's they recieved last time and No Pay. At least they will recieve back pay when the budget is finally settled.

My Dad was working for state corrections when they issued the IOU's. He was not a happy man, iirc.

Still, it looks like the state's in some serious trouble. 15.2 billion dollars worth.

Even though I love California and I grew up here I cannot wait for my employer to get me the hell out of here.

As much as I hate to see working people get screwed, it's nice to see the government buckling under its own weight these days (it's happening here in Atlanta too). Maybe being broke is the only way they'll learn to spend responsibly.

Will be interesting to see how this works out. I've long held the belief that most state jobs are over paid positions. I know a young lady who works as Flagger here in WA, her private sector pay is a lousy 9$ an hour. what keeps her solvent is assignments to state jobs and the "prevailing" wage that accompanies these. that's when her pay jumps to 26-32$ an hour depending on the project.

Prevailing wage is what everyone should be making, in theory. There's just no competition at the state level. Maybe we should have competing governments? :D

As for what the governor is doing, my girlfriend thinks it's political suicide. She doesn't think Schwarzeneger will get re-elected. Personally, I'd vote for him again. Along Sanchek's line of thinking, I too feel like the state's spending is out of control. It's time to get responsible.

Hell umm didn't the last governor get re-elected after the IOU debacle. This is better than that, at least people get money and in the end will get the rest. And the uninformed will realize that its the assy. that let it go this far not the gov and that he is at least trying to keep us from falling deeper into debt when we have to start extensively borrowing to pay bills when we run out of cash.

My only concern for the staties is, if this goes on too long, they're not going to be able to meet their monthly bills. I'd be pissed if I suddenly went down to min. wage and couldn't pay my bills.

Now, my gf said that he's hitting the wrong people in the pocket book. He should be going after the legislators pay. Can he do that?

I dunno they set thier own pay so I doubt it. If he could he should. I am all for it damn them take thier vacation and pay until there is a solution.

Yeah California is crazy expensive...you cant live off minimum wage. Hope it gets fixed soon or there will be lots of homeless.

To save CA, Prop 13 (http://en.wikipedia.org/wiki/California_Proposition_13_(1978)) has to go. And that can't happen because every R has to swear fealty to Whatever! Grover! Norquist! Says! (mostly which is "starve the beast"). Taxes need to be raised, but Governor Shwarzenegger is trapped into an ideological corner because his oath of fealty prohibits him from raising taxes. Something is going to break, and everyone is playing chicken.

Such as, the city of Vallejo (http://en.wikipedia.org/wiki/Vallejo_%28CA%29) in CA is filing bankruptcy because their revenues are way down (thanks to the mortgage meltdown) and expenses are way up (thanks to cost of living agreements in labor contracts).The city of Vallejo, California, filed for bankruptcy on Friday, a move signaled by its city council earlier this month as it struggles to avoid running out of money amid steep city personnel costs and sliding revenues from a housing slump.

The Chapter 9 filing by Vallejo, a blue-collar, former Navy town in the San Francisco Bay Area, in U.S. bankruptcy court in Sacramento had been expected since May 6, when the city council approved the drastic move.

"It is a sad day for the city and for me personally. It is not something I ever wanted to do," Vallejo Mayor Osby Davis told Reuters. "We did everything we could do to find other solutions and other alternatives, but we were not able to."

Vallejo, with more than 100,000 residents, is the first sizable city in California to file for bankruptcy. Chapter 9 is a bankruptcy filing for municipalities. Source (http://www.reuters.com/article/bondsNews/idUSN2352179020080523)
A blog post on this (http://calculatedrisk.blogspot.com/2008/02/california-city-nears-bankruptcy.html)
Another blog post on this (http://www.huffingtonpost.com/2008/05/23/vallejo-calif-files-for-b_n_103356.html)
They won't be the last city to collapse from the mortgage meltdown. Many other cities are struggling to meet budgets and can't because lenders aren't sending in taxes that may or may not have been collected on delinquent properties. If Vallejo ends up unincorporating, they'll smack the already weak bond market into a tailspin.

Chapter 9 bankruptcies don't permit municipalities to write off debt, mostly because of how courts have interpreted the 14 Amendment (in particular the bolded bits): Section 4. The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. Source (http://en.wikipedia.org/wiki/Fourteenth_Amendment_to_the_United_States_Constitu tion)
The only avenue for Vallejo to escape their financial burdens is to unincorporate as a city. And the people involved will be totally fucked as the Government Pension Reform Act substantially reduces Social Security benefits for anyone who is/was covered by a public pension - such as the ones that firefighters, teachers and policemen get. So they'll get SS reduced by the amount of the pension that they're not getting anymore.

While many people like to ridicule Vallejo for the high salaries they pay their public employees, I'd like to point out that last (http://money.cnn.com/magazines/moneymag/bplive/2007/snapshots/PL0681666.html) year the median house was $440k. And that in many parts of CA, neither the police nor teachers can afford to live in the communities they work in.

California as a state is doomed until they chose to ditch Prop 13. And since many people will cheer if CA collapses, I don't see much chance for them to stave off the collapse before it happens.

Interesting, I have not seen Arnold and Maria doing their come to California ads for a few weeks; must be the combination of the wildfires and the financial woes befalling the cities there.