As a budget stalemate continues, California has been forced to begin issuing IOUs, as the state runs dangerously low on cash.
State legislators failed to meet an end of January deadline on an agreement to make up for California's $40 billion budget gap. California's budget requires a 2/3 majority to pass, and the Republican members have vowed to vote for nothing that includes a tax increase.
At the same time bills go unpaid, with partisan politics taking the blame. What the GOP fails to forget, is that you cannot cut everything and have the state budget be nothing. They have cut schools (already California is among the bottom in school spending) and other valuable services, yet refuse a tax increase.
Part of the IOUs: state tax refunds.
"People are going to be hurt starting today," said Garin Casaleggio, a spokesman for Controller John Chiang.
If there is no deal by Friday, state government workers will be forced to take their first work furlough day. Governor Arnold Schwarzenegger has ordered state employees to take two days off a month without pay through June 2010.
Frankly, the alternative, according to Schwarzenegger, is layoffs. Despite that, state employee unions originally sued, but a judge ruled the governor has the ability to order the furloughs.
A lack of common sense showing? I have said previously that it would be better to reduce salaries by 20% than to layoff 20% of a company's (or state's) employees.
State lawmakers were continuing budget negotiations on Monday night.
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