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California double-whammy?

Even though the Democrats in California’s Legislature are resisting cuts to social programs, and Republicans are resisting new taxes, to close California’s $24.3 billion budget deficit, guess what… the outline of a new budget composed by a joint committee of state lawmakers includes BOTH!

Isn’t that what compromise and negotiation are SUPPOSED to be about? :-)

(Note added July 22, 2009: Maybe California Republicans STILL have not learned to compromise – everything that I read about the “compromise” reached on the state budget says “no new taxes.” I included a link to the definition of the word “compromise” in one of the  two blog entries that I wrote yesterday, to assist any legislators for whom the concept is entirely foreign.)

Cuts in social spending and possible new taxes on tobacco, oil, and property are all under consideration. It will be weeks before the full legislature and the governor act on the committee’s recommendations, and any new taxes will require a 2/3 majority to pass. An audio interview today with Governor Schwarzenegger about the budget crisis, conducted by John Myers and downloadable as an MP3, is located here.

Still waiting for “the other shoe to drop?

UCLA‘s quarterly Anderson Forecast predicts that 60,000 government positions will be eliminated in California, as the legislature tries to reduce the $24.3 billion deficit, which is expected to produce only feeble economic growth until 2011. The report predicts an unemployment high in California of 12.1% in fourth quarter of 2010 (it was 11.2% in March and 11.0% in April 2009), with a drop to single-digit unemployment not occurring until 2011.

(Note added June 21, 2009: The April 2009 unemployment for California was revised upward a bit to 11.1%.)

As with all predictions – we shall see….

-Bill at Cheshire Cat Photo™

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