After months of political gridlock, California state lawmakers agreed on a series of budget measures lastThursday, February 19. The following day, February 20, Governor Arnold Schwarzenegger fi nally signed. The budget agreement came after a record-long fl oor session of nearly 46 hours.
But is this the end of pain or again, just a start of the more cuts that will affect almost everyone in California? The $143 billion budget closes a nearly $42 billion defi cit through 2010 with tax increases, deep cuts in services and extensive borrowing.
Can California get out of the hole it is in right now? At present, the state has the worst credit rating in the nation—worse even than Louisiana’s. It also has the nation’s fourth highest unemployment rate with 9.3 percent (after Michigan, Rhode Island and South Carolina) and the second highest home foreclosure rate (after Nevada). Also, roughly 1.4 million more nonimmigrant Americans have left California than entered over the last decade, according to the American Legislative Exchange Council. California is suffering more than most states from the housing bust, but its politicians also showed less spending restraint during the boom.
Many believe that while the compromise budget package agreement will solve immediate and critical problems in the state, the long-term effects of the cuts enacted will prove to be more costly.
For now, more challenges lie ahead for California, and its future is on a “wait and see” mode. (AJPress)
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( Published on February 21, 2009 Asian Journal Los Angeles p. A12 )
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