Since the fall, when lawmakers began trying to attack the gaps in the $143 billion budget that their earlier plan had not addressed, the state has fallen into deeper financial straits, with more bad news coming daily from Sacramento. The state, nearly out of cash, has laid off scores of workers and put hundreds more on unpaid furloughs. It has stopped paying counties and issuing income tax refunds and halted thousands of infrastructure projects.
Twenty-thousand layoff notices will go out on Tuesday morning, Matt David, the communications director for Gov. Arnold Schwarzenegger, said Monday night. “In the absence of a budget we need to realize this savings and the process takes six months,” Mr. David said.
Paul Krugman writes "Years of neglect, followed by economic disaster - and with all reasonable responses blocked by a fanatical, irrational minority. This could be America next."
There are obvious similarities between the way that California Republicans have destroyed any attempt to raise the California budget, and the way that congress Republicans have fought to blunt response to the financial crisis. There's more to it though. I've long contended that ballot initiatives have hamstrung that state, mandating high spending (three strikes anyone?) and imposing bad policy in general. The fact that the Republican minority has been able to block any compromise is that an initiative required a super-majority for tax increases. The situation in congress, despite the filibuster, is not the same.