June 16th, 2009
08:08 PM ET
9 years ago

California tries to avert budget disaster

WASHINGTON (CNN) - As state officials warn California is on the brink of bankruptcy, state legislators are meeting trying to come up with their own way of closing the $24.3 billion deficit. Republican Gov. Arnold Schwarzenegger last month proposed billions of dollars in cuts in education, health care, prisons and social services. But Democratic lawmakers have not lined up in support of the governor's solution. They, along with a variety of interest groups, argue slashing key programs is wrong because too many citizens would be hurt. Instead they are pushing such possibilities as new taxes on tobacco and oil extraction, short-term borrowing and taking money from a rainy day fund - all ideas Schwarzenegger has said he won't support.

"The bottom line for Assembly Democrats is that we are committed to ensuring that the state's fiscal emergency isn't allowed to be misused to eliminate the safety net in California or to eviscerate our public education system. We are working closely with the Senate and the governor to resolve the budget deficit by the end of the month to avoid a potential cash crisis," Assembly Speaker Karen Bass said in a statement last week.

The state's controller has said California will be out of money to pay its bills by the end of next month, and the governor says this is the time for hard choices because the state must get its fiscal house in order.

"I've heard accusations that I tried to shut down state government. I don't have to shut down state government because when they don't produce a budget on time we will run out of cash and therefore our government will shut down by itself," Schwarzenegger said Friday.

AIDS activists, unions and providers of senior services all have hit the streets in recent weeks to mount protests against the governor's proposed funding cutbacks.

For example, on the chopping block is $6 million for Alzheimer's research and more than $4 million in funding for adult care centers for those with the disease as well as nearly $500 million from programs for senior citizens.

"I see the children whose teachers will be laid off. I see the Alzheimer's patients losing some of their in-home support services. I see the firefighters and police officers who will lose their jobs. People come up to me all the time pleading governor please don't cut my program. They tell me how about the cuts affect them and their loved ones. I see the pain in their eyes and hear the fear in their voices and hear the demonstrations outside our Capitol. It is an awful feeling, but we have no choice. Our wallet is empty, our bank closed and our credit dried up," Schwarzenegger told state legislators earlier this month in an address.

But advocates for Alzheimer's patients and caregivers say the cost will be too much, causing a tidal wave of problems.

"People have paid taxes, people have input into the government, and they should be able to have something coming out of it," Toby Wolfberg, whose husband Howard has Alzheimer's, told CNN. Howard Wolfberg goes to Wise and Healthy Aging Center, an adult day care center which provides memory and music classes to those suffering from the disease. It stands to lose $300,000 if Alzheimer's programs are eliminated as well as additional funds if other senior services are scrapped.

"We understand there needs to be cuts because there is a financial crisis in the state. But don't totally eliminate funding in the state," Grace Cheng Braun, the center's president, told CNN, saying society is basically abandoning those who have contributed so much already.

Filed under: California
soundoff (14 Responses)
  1. Grrr-awful-o

    Funny thing: the most liberal state is taxing "the rich" (liberally defined) the most of any other state. AND... they've lost more of the rich. AND... they have the worst deficit of any state. In fact these things are true of the three states with the worst deficits. But I'm sure it's all just a coincidence.

    "Change you can believe in!" "Yes we can!"


    June 16, 2009 11:22 pm at 11:22 pm |
  2. Shannelle

    The United States could solve state budget "problem" by doing two things: Denying American citizenship to any child born in the Unites States (as happens in many border states, expectant mothers come to the USA, deliver their babies who are then given automatic US citizenship, and are entered into the welfare system thus, the entire family receives welfare), and by NOT handing out social security benefits to immigrants solely on the basis of their age. I see this all the time in the healthcare field. Illegal immigrants who have never contributed 1 cent into Social Security are receiving benefits because they are 65 or older. Illegals come into this country are are given free healthcare (compliments of programs like HAP, hospital/clinic charity programs etc), free interpretors, free everything – while we absorb the cost! WAKE UP, PEOPLE! Eliminate automatic citizenship to babies born to illegal immigrant parents and stop giving out social security to people who have never pain into it!!!!! These @ things are a NO-BRAINER!!!!!

    June 16, 2009 11:33 pm at 11:33 pm |
  3. Alan

    So what if they fail. What does that mean? Maybe China will reposses CA and take it home:)

    June 16, 2009 11:36 pm at 11:36 pm |
  4. nadine

    Let me get this straight, Arnold would rather cut funding for health care, social services, and education instead of taxing oil companies and tobacco, no wonder California's going bankrupt, they have a Republican in command. The Democrats want to work around these cuts just like a true Republican, Arnold wants to please the rich oil and tobacco people. Shame on you for allowing this to happen.

    June 16, 2009 11:47 pm at 11:47 pm |
  5. normajean

    I hope our California govenor still has friends in Hollywood because he's going to be looking for a job pretty soon and it won't be in politics. Wasn't he the one who wanted to revise our constitution so that he could run for president? "Nuff said.

    June 16, 2009 11:51 pm at 11:51 pm |
  6. Bob

    STOP STOP cutting health care, senior, education,and child care. All elected people take a 50% cut. You all are over paid. Raise state tax 1% more.

    June 16, 2009 11:57 pm at 11:57 pm |
  7. Julianna

    Instead of the Father Bush's lipreading, let's be loud enough for everyone including myself in California: Hike taxes for two years!

    June 17, 2009 12:00 am at 12:00 am |
  8. That One Guy

    If the dumbocrats didn't spend so much they would be in this mess.

    June 17, 2009 12:03 am at 12:03 am |
  9. John

    Enough is enough. The state can't pay for everything. Need to apply six sigma principles and throw money at the greatest opportunities and scrap some programs. Everyone is unwilling to compromise. You are bankrupt!

    June 17, 2009 12:05 am at 12:05 am |
  10. Jason

    Really? Didn't we get rid of Gov. Davis for less than this? Stop electing celebrities California!!

    June 17, 2009 12:32 am at 12:32 am |
  11. B-Lan

    its high time they legalize marijuana, tax it, and be swimming in profits faster than you can say "budget crisis, what budget crisis?"

    June 17, 2009 12:44 am at 12:44 am |
  12. do all of it

    do all of it.

    don't stop, aim for a surplus.

    June 17, 2009 12:48 am at 12:48 am |
  13. brian allan

    I'm not from California; however, I've tracked their personal and property taxation levels... AND they are some of the lowest in North America. There is a lot of untapped taxation to be had in California. Either pay more in taxes or drop services... not much else to do!

    June 17, 2009 12:56 am at 12:56 am |
  14. renea

    This is what the republicans should be all over this a republican Gov. who has so much debt in his state and he donot know what to cut. Why dont they try to offer some suggestions for this. This is sad. the reason why the republicans dont try to offer advice is because most of them are not trying to run for gov. of california instead they are trying to run for president in 2012.

    June 17, 2009 01:15 am at 1:15 am |