Friday, December 12, 2008

Maxwell Smart to California: Missed the Budget Shortfall by THAT Much

The ticking time bombs continue all over America. Of course budget makers clearly have no clue about the deterioration in revenue this recession is going to cause - so a lot of estimates are still 'rosy'. California is revising by the month at this point.
  • California's budget crisis is growing worse as its shortfall for its current fiscal year has increased to an estimated $14.8 billion from a previously estimated $11.2 billion, Gov. Arnold Schwarzenegger said on Wednesday. (what's $3 Billion among friends? Bail 'em out - I mean I can write the script now "How can you throw so much money at the banks with no questions ask, and then throw $15B at auto companies, and then leave the people of (insert your own state) California to rot like this? Do you realize how many jobs you risk? You don't want that blood on your hand.... please send your bailout to (insert your state capital here) Sacramento, PO BOX....)
  • The Republican governor said he would call top lawmakers into a meeting to stress the need for fast action by the Democrat-led legislature on balancing the budget of the government of the most populous U.S. state because it may be out of cash by the end of February. (darn, we are not even going to get to the summer 2009-2010 budget period when the real crisis begins? what's that? ah that's reserved for the late 2009 federal stimulus/bailout - will that be post or pre Thanksgiving 2009? I just want to clear some time on my calendar to blog about it)
  • Schwarzenegger's new budget shortfall estimate comes a day after state Controller John Chiang reported the state's general fund revenues in November were $1.3 billion, or 18.5 percent, below expectations. (so home values falling, sales receipts faltering, employers cutting jobs - all our 3 main revenue lines falling but we missed our estimate by nearly 20%? Well, time to move to Wall Street - missing something by only 20% in an investment bank is grounds for a $50 million bonus)
  • California's shrinking revenues and swelling budget shortfall reflect the severity of its housing downturn, rising unemployment and weak consumer spending as both the state and national economies slow.
Folks, I stand behind this bailout with both pockets open; I mean Michigan has been in a half decade recession but that's ok - that was easily seen. That's a White Swan. What is happening in California and in many other states....who really could have seen this coming? It was a Black Swan - a once in a million year event that never could of been predicted. [Dec 16 2007: California in a State of Emergency - Coming to a Theater Near You] [Apr 25 2008: Shoes Beginning to Fall in the States] [July 25 2008: WSJ: States Slammed by Tax Shortfalls] When natural acts of God that no one could foresee like hurricanes, floods, or budget shortfalls happen - we must band together as a nation and help our neighbors.

What a joke. "Kick the Can" policies - made in America.

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