Signup for our free newsletter:

Schwarzenegger's California Goes Greek

Written By Brian Hicks

Posted July 30, 2010



It’s days like this that Arnold Schwarzenegger probably wishes he never left Austria and discovered steroids.

Much like in Greece, California is hitting the proverbial wall….again.

From Reuters by Jim Christie entitled: Schwarzenegger declares California fiscal emergency

California Governor Arnold Schwarzenegger declared a state of emergency over the state’s finances on Wednesday, raising pressure on lawmakers to negotiate a state budget that is more than a month overdue and will need to close a $19 billion shortfall.

The deficit is 22 percent of the $85 billion general fund budget the governor signed last July for the fiscal year that ended in June, highlighting how the steep drop in California’s revenue due to recession, the housing slump, financial market turmoil and high unemployment have slashed its all-important personal income tax collection.

In the declaration, Schwarzenegger ordered three days off without pay per month beginning in August for tens of thousands of state employees to preserve the state’s cash to pay its debt, and for essential services.

California’s budget is five weeks overdue, joining New York among big states with spending plans yet to be approved, and Schwarzenegger and top lawmakers are at an impasse over how to balance the state’s books.

“Without a budget in place that addresses our $19 billion budget deficit, every day of delay brings California closer to a fiscal meltdown,” Schwarzenegger said in a statement.

Schwarzenegger has said he will only sign a budget agreement if it includes an overhaul of the state’s public pension system, which includes the California Public Employees’ Retirement System, the biggest U.S. public pension fund, which he says poses one of California’s greatest financial challenges going forward.”


I think Arnold has seen some better days.

Related Articles:

The Brewing Pension Funding Crisis

Public Pension Funds Head to Vegas

The $1 Trillion Pension Gap

California’s $500 Billion Hole

To learn more about Wealth Daily click here.