50 Days Until California Meltdown - CA Controller

Awesome. The California Controller says the state has 50 days until complete meltdown.

From his letter to the Governor:

On May 29, 2009, I informed you of the precarious nature of the State’s cash condition and alerted you to impending risks which threaten the State’s ability to meet its payment obligations.

The situation has not improved. Based on actual revenues received during the month of May, and finalized May Revision data provided by the Department of Finance on June 1, I have the following updates to the State’s 2009-10 cash outlook:

  • In the absence of legislative action, the State will not have sufficient cash to meet all of its payment obligations on July 28. By July 31, the cash deficit will increase to a negative $2.78 billion.
  • In April, the State’s cash balance will fall to a negative $25.3 billion – the lowest point projected for Fiscal Year 2009-10. To put this shortfall into proper perspective, it is five times the $5.1 billion cash deficit we faced this past spring.

As we know a picture is worth a 1000 words:

CA cash deficit 2009

A pdf from May showing the cash flow crisis of California.

So, California is completely running out of cash. Think they will consider the $10.5 billion annual cost estimate of CA's illegal immigration problem as part of their agenda to dramatically cut costs? Note all of you who believe all woes are all about illegal immigration, that's only 1/2 of the total cash deficit.

Calculated Risk has another graph.

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While I agree that there are costs to illegal immigration:

California's problems are very structural. It takes practically acts of God to pass a budget or increase taxes (property and income).

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I agree with you from the stats

It seems to be systemic. I just like to put that in because we have some major economic fiction when it comes to costs and labor economists facts...lots of just beyond belief spin claiming that unlimited migration/illegal immigration helps the economy.

Does anyone even really understand all of the structural problems, the gerrymandering, political, special interest gridlock, etc. in CA to even give us an overview?

I sure can't!. If you find an objective, insightful analysis on the California disaster big picture, please share.

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Sure, but I will say one thing in the meantime:

Proposition 13.

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I wonder

what would happen right now with that but that's why I linked to the LA Times (the ultimate open border advocacy newspaper and they mention prop. 13.

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Here is a good explanation.

Some one may argue a bit partisan but it is a good start.

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I don't know why I am spending time on this issue.

I lived in California for 2 years during the internet boom. The best thing was the weather - that was it. I remember voting in an election that had several propositions on the ballot. You have to be someone trained in legalese to understand them. A well intentioned system that has been absolutely corrupted.

Anyway, here is an interesting point of view. This author scorches everybody: Link

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that bit of gold rush?

I agree with you. Beyond some of the beauty, which one really couldn't enjoy due to the massive traffic jams and hordes of people around...California is one hell hole to me.

But it's fascinating to watch a state with so much resources basically f**k itself into the ground. I mean what a situation that didn't need to happen.

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I grew up in CA

Love the Sierra, love the coastline north of Santa Barbara, love the desert, love San Francisco, though I don't much care for LA or San Diego. But Prop 13 and the 2/3d's rule has made it completely ungovernable.

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Gov. Arnold Says...Bend Over

The annual mandated expenditures voted in by all the various legacy initiatives, plus the Prop. 13 tax caps, plus the CalPers unfunded state employees pension liabilities, plus the state prison guard unions, plus...
Fact: everyone wants to take, but no one wants to pay in.
Golden State=BK.

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California handing out $8 billion in I.O.U.'s

Here it comes. Calif. IOUs loom as lawmakers remain at impasse.

They should rename the state slogan to be The FUBAR State.

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