http://news.independent.co.uk/world/americas/story.jsp?story=420581

The state of California, as of midnight last night, was officially broke.

The richest, most populous state in the union - by some measures the world's fifth biggest economy - is facing a budget deficit of $38bn (£23bn).

Midnight was the nominal deadline for the state legislature to balance the books for the new budgetary year, which begins today. But the legislature, riven by partisan rivalries, including a vicious battle to unseat the governor just months after his re-election, never stood a chance of meeting it.

Worse, the longer the legislature takes to cure its financial headache, the bigger the deficit will become. It stood at $34bn two months ago; by the end of summer, it is expected to top $40bn. That is more than the budget deficits of all the other deficit-ridden US states combined. Since states, unlike countries, aren't allowed to run deficits, California is now facing the equivalent of the bailiffs coming around to impound the furniture.

Summer courses at community colleges are expected to be the first casualties. Then nursing homes. Then police academies. Tens of thousands of teachers who had hoped to be spared may now get laid off instead of squeezing under the financial limbo-stick.

This would be bad enough without the singularly tawdry politics behind it. In many ways, the situation is reminiscent of the 1995 stand-off between President Bill Clinton and the Republicans in Congress who preferred to shut down the federal government rather than sign off the White House's budget proposals.

But this time, the cast is more colourful, featuring a car alarm salesman from San Diego and the action movie star Arnold Schwarzenegger.

The Californian crisis is a fight in which everyone from the White House down has a stake. Republicans are crying foul about the corruption of de facto one-party rule by the Democrats; Democrats, meanwhile, are accusing the Republicans of attempting a bloodless coup to seize control in a state where they routinely lose almost every election.

California is in financial difficulties because of the slackening economy. But it has also suffered from very effective lobbying, over a period of decades, by anti-tax advocates who have placed strict limits on property taxes and required that any tax increase, direct or indirect, be approved by two-thirds of the state legislature.

That makes California's economy singularly inflexible: when times are good, the revenue rolls in but when they are bad there is almost no stability in the system.

Enter the Democratic governor, Gray Davis, first elected in 1998, whose popularity has plummeted because of the perception that he can't handle crises and has only one true talent: raising money for himself and scratching the backs of his campaign contributors.

Democrats and Republicans both hate him, but Republicans hate him more because he is in power and they are not.

Hence the campaign to have Mr Davis "recalled" - forced to stand in another election - just months after his re-election. (He won largely by default, since his Republican challenger, Bill Simon, ran a dismal campaign and came off even worse than Mr Davis).

The recall, which requires the signatures of about 900,000 eligible voters to get on the ballot this November, is being coordinated by an ambitious, rich Republican congressman from San Diego called Darrell Issa. Mr Issa is not exactly Prince Charming: he is too right-wing for the Californian mainstream and his brother is an acknowledged car thief.

Mr Issa has made better headway than expected, having collected more than 400,000 signatures so far before the deadline on 2 September.

But the big question is, what will happen if there is a recall election - a scrappy affair in which anyone can participate and the person with the most votes on the first round wins.

Mr Issa clearly wants to run, but many Republican strategists would prefer someone more palatable. The name that comes up most often is Schwarzenegger, who has name recognition galore even if he is an unknown quantity in political terms.

Suspicions are rising that the Republicans are refusing to agree to a budget on the theory that the worse things get for California, the better their chances of toppling Mr Davis become.

It's a strategy that is making some Republicans queasy: several have wondered whether the recall is such a good idea, and three of them signed an open letter to President George Bush at the weekend urging the White House to distance itself from the whole spectacle. California's economy, they wrote, was too important to become hostage to a democratically questionable political gambit.

Mr Bush, of course, knows a thing or two about bloodless coups, having been accused of staging one in Florida to enter the White House. For the moment he is saying nothing, letting California stew in its own juice a little longer before making his pronouncement.

TIME FOR AN ACTION HERO?

Will he run or won't he? As the momentum gathers to recall Gray Davis, California's unpopular Democratic Governor, the question on everyone's mind is whether Arnold Schwarzenegger will have the guts to launch a career in politics by running for the Republican Party.

Mr Schwarzenegger has made no secret of his ambition, and at 56 his days of macho posturing on screen are almost over. But there could hardly be a hairier moment to jump in, with the budget in tatters and state politics in turmoil.

In a dream scenario, Mr Schwarzenegger would sweep to power on a popular tide, end the partisan bickering, heal the budgetary wounds and cruise to re-election in 2006. On the other hand, it could all go horribly wrong.

He could be tainted by revulsion at the recall itself, or smeared by opponents (they say they can't wait), or outmanoeuvred by other Republicans jealous of his fame and resentful at his lack of experience. (His one big effort so far: sponsoring an initiative to fund after-school care programmes.)

To complicate the scene further, Mr Schwarzenegger is busy plugging Terminator 3, due out in the US this week. His final decision may be dictated by the success of the film. If it's a hit, he might think another payday for Terminator 4 is more attractive than digging California out of its holes.

...The Terminator and Dirty Harry clean up Sack-a-Tomatoes?

Susan Sarandon, Peter Camejo, Media Benjamin, Barbara Lee, Angela Davis, or Blase Bompane of KPFK are all people that I would not mind seeing replace Davis.

"Susan Sarandon, Peter Camejo, Media Benjamin, Barbara Lee, Angela Davis, or Blase Bompane"

People with the political philosophy of the above individuals are the reasons California is in the poor financial shape it is. Until that sinks in, there's no reason to believe California will recover. And it shouldn't. Citizens who continually vote in liberals *should* suffer for their own stupidity.

"People with the political philosophy of the above individuals are the reasons California is in the poor financial shape it is."

Unsubstantiated Allegation
For more on logic at your level, try reading "Logic for Dummies."

Citizens who vote in conservatives are making EVERYONE suffer for their own stupidity.

"Susan Sarandon, Peter Camejo, Media Benjamin, Barbara Lee, Angela Davis, or Blase Bompane"

Vote 'em in then. No sweat off my back.

The NeoCons would like to a return to the robber baron period of capitalism, and a total reversal of the New Deal. Don't take my word for it. That's what Karl Rove talks about in public.

Grover Norquist, one of the nation's most powerful strategist in the neocon con camp says that he'd like to see government shrink down to the size small enough to drown in a bath tub, and he told the New York Times that he's like to see one of the state governments go bankrupt. So much for "compassionate conservatives" -- neocon cons are notorious for Orwellian revision of the English language.

Folks, it really doesn't mater if you're an anarchist or a green or a democrat or whatever. Stop fighting among yourselves and bickering about the little details of anyone's analysis of the world. Look at what is going on at face value. These neocon jerks talk about their plans in public.

Privatization and deregulation are tools. The Enron and kind attack on California represents 70% of the current deficit.

The Pentagon has "misplaced" 3.3 trillion dollars. Whoops........... Better look in offshore accounts

Big government will save us all.

"California is in financial difficulties because of the slackening economy. But it has also suffered from very effective lobbying, over a period of decades, by anti-tax advocates who have placed strict limits on property taxes and required that any tax increase, direct or indirect, be approved by two-thirds of the state legislature."

Let's tax our way into prosperity. It's never, ever worked anywhere on the planet Earth before, but this is California, so why not!!

The two thirds requirement effectively gives property holders more votes than non-property holders; it allows a minority to "outvote" a majority and it is a throw-back to the days when only property holders had the right to vote because, according to the political right, only they had a sufficient "stake in society" to have a say in its governing. It is fundamentally a repudiation of democracy.
We should also remember that Proposition 13 is a relic of a California that no longer exists. The state has changed demographically in such a dramatic way since 1978 that it would never pass today. Too many older, conservative whites have died or moved out of state and the population of renters, minorities, and younger people in general has grown too big.

but a government that doesn't provide corporate welfare and tax support to the rich is a nice start.

conservatives and reactionaries (called neocons) like to claim that the rich pay a higher percentage of their annual income in taxes, and they make their arguments on INCOME TAX. But if you take the average $15,000/year earner or whatever and look at all the taxes they pay in all forms, the percentage is higher than the richest people

but within about ten minutes, someone will come here and say this isn't true. watch.. neocon trolls love LA IMC. The funny thing is, the neocons here are probably earning anything from 50k to 300k. They're just aspiring ...

Wake up. Realize that Henry Ford wasn't a whacko when he considered that people need to make a living wage for his business to do good. Realize that Teddy Roosevelt talked about a living wage that was way in excess of what we see today. These ideas are not just liberal (pull your brains out of Rush land and read some history books).

Taxation, particularly taxation of the wealthy and well-do-do, is considerably higher in the Scandinavian countries than in the United States, yet the average person has a higher standard of living. So how can what you say be true?

"pull your brains out of Rush land and read some history books"

Lesson learned. Don't talk down to others. It's unbecoming and will not cause the working-class to want to be a part of you.

"like to claim that the rich pay a higher percentage of their annual income in taxes"

No. They claim they pay the higher percentage of total revenue taken in by the government. And that's true.

"But if you take the average $15,000/year earner or whatever and look at all the taxes they pay in all forms, the percentage is higher than the richest people"

I'll agree with that. But that's not the point. No one's gonna tell rich people they have to pay $5 for a loaf of bread and poor people only must pay $1. That's not how it works.

Overburden people with excessive taxes and they are going to move where they're not taxed as much. There's been a massive movement of people and companies from the industrial north to the south in the last 20-30 years and from California to its neighbors in the west. Pretty soon, all you'll have is a big welfare state and no one paying into it. Economic disaster.

Punishing achievers will never lead any state or country to economic prosperity.

"Taxation, particularly taxation of the wealthy and well-do-do, is considerably higher in the Scandinavian countries than in the United States, yet the average person has a higher standard of living. So how can what you say be true?"

Because they keep the wogs* out. In the US, we've got people that because of their ancestors or their heritage believe America owes them a living. The "hammock" welfare class takes and never gives.

For info on "wogs":

http://www.la.indymedia.org/news/2003/06/68790.php

"In the US, we've got people that because of their ancestors or their heritage believe America owes them a living."

Unsubstantiated Allegation
For more on logic at your level, try reading "Logic for Dummies."

sure we do. theyre called niggers and indians

The Democrats have run this state for decades, and now they've run the budget right into the ground. What's their solution to the probelm? The same thing it always is, raise taxes.

I love you! Would you like a job scrubbing my gold toilets?

I love you more! Let me raise your taxes to show my love.

Sorry, but I would prefer to scrub Kenneth Lay's gold toilets clean with my tongue. I'm fond of Mr. Lay. I would drink his bathwater.

Fine then. Don't pay higher taxes.

OK, me and the Democratic party are out of ideas.

And I'll be in heaven, licking Kenny boy's shitters clean. I can't believe that I'll actually get PAID to do it!

And if it were up to me, I'd tax the hell outta what you made in heaven. It's me and my Party's solution to everything.

"It's me and my Party's solution to everything."

Unsubstantiated Allegation
For more on logic at your level, try reading "Logic for Dummies."

The only solution that's been put forth lately is raising taxes. What other solutions do you believe have been put forth?

FUCK you! I couldn't care less about California's budget crisis. I already milked you suckers dry.

"I already milked you suckers dry."

And we weren't smart enough to stop you. What does that say about our intelligence and ability to lead?

And WE weren't smart enough to stop you, either. In fact, we were complicit in the matter! What does that say about our morals?

But then again, we are not the majority in the CA congress nor do we hold the office of governor, so we aren't in any position to be able to effect legislation nor to be held responsible since we essentially have no power.

What the Republicans have said is true. Try as we might to blame them, we are the party who is in control.

anti-moron/faker/KOBE, we need help. You claim to be so brilliant. What is your solution to remedying the CA Budget crisis?

A very large number of Californians are already on Skid Row - literally. Just visit Spring Street or Main Street in downtown LA sometime and you will see what I mean.

And we feel their pain.

Mind if we raise your taxes?

We have been in control of the California budget for decades now. We knew there was going to be a problem this year but have waited until the eleventh hour to try and do anything. Over the years, we have legislated entitlements in order to buy votes, but we are sorry to say that with our current mismanagement of the California economy, we must cut into these precious programs. Also, we need to raise taxes. Raising taxes doesn't bother us because that's one of the three things we do best: blame the Republicans, fuck things up and raise taxes. That is our agenda.

At least you have an agenda with which to press forward. All we can do is talk about what we want to have happen and about how we need to organize. It makes us feel all warm and fuzzy to talk out our emotions. We don't have a clue as to how and actually implement anything we would like to see happen. If by chance any of the things we desire have actually come to fruitiation, please let us know, because we are not aware of any having taken place.

I am not a conservative.

Pass the bong, dude!

"I dont post unless I have something RELEVANT to say."

Posting something relevant is beyond my limited capabilities. I am a radical militant leftist claiming to be a Libertarian.

"anti-moron/faker/KOBE, we need help. You claim to be so brilliant. What is your solution to remedying the CA Budget crisis?"

I'll do anything to avoid answering a question like that.

faker/KOBE has offered no suggestion as to how and fix this mess.

So we'll:

Raise Taxes
Blame the Republicans
Raise Taxes
Blame the Republicans
Raise Taxes
Blame the Republicans
Raise Taxes
Blame the Republicans
Raise Taxes
Blame the Republicans

Damn! Still not working!!

Organize!
Organize!

As we all know, ther real cause of the financial crisis facing California is the huge amount of taxes levied on wealthy individuals and multinational corporations in order to finance the luxurious lifestyle that the homeless are enjoying in downtown LA. The Enron rip-off had little or nothing to do with it. Besides, we should all be happy to be paying huge bills to Enron and other private companies; money spent in this fashion doesn't really count since it is not being taken away from us in the form of taxes to support the unworthy poor, welfare mothers, the handicapped and the like. It is kind of like giving money to God, but only better because it is helping to keep the FREE ENTERPRISE SYSTEM operating. Could anyone think of a more worthy cause? Besides, executives with Southern California Edison and similar outfits have to live, too, and an income of several milliond dollars a year doesn't go as far as it did in 1990.

Sorry, Meyer London, but I'm much too simpleminded to understand your post. I'm a conservative. I'm the one who's been posting as faker/KOBE, Democratic Representatives in CA, Temecula, and "activist community." I'm acting like a deranged lunatic because I got kicked out of KOBE.

The activist community is dying!
Organize!
Organize!

That's right. I'm going to go out and accomplish something, right after I smoke this doobie.