Insurrection Looms in California

[Watchman]

Insurrection Looms in California
February 11, 2009 | From theTrumpet.com
America has a lot of experience with rebellions. California is about to get one of its own.

In what amounts to a Boston Tea Party-type rebellion against the government, California counties are threatening to withhold their money. Constitutional officers are also refusing to accept Gov. Arnold Schwarzenegger’s authority to furlough workers. Meanwhile, two more California banks failed over the weekend, and a judge ordered the state to release up to 37 percent of its prison population. What is ahead for California?

Los Angeles, Sacramento, Orange, Colusa, Riverside, Imperial and San Bernardino counties may be on the verge of insurrection.

Several counties “say they’ve had enough—and they aren’t going to take it anymore,” reports the Sacramento Bee. Plans to withhold money, levy lawsuits against the state, and refuse to provide state-mandated services are in the works, and in some cases are already being implemented.

“It’s not at all surprising,” said Gerry Hertzberg, policy director for Los Angeles County Supervisor Gloria Molina. “We’ve got obligations.”

Seeds of rebellion were sown after the state announced it would halt payments on $3.5 billion worth of construction projects, tax refunds, and county transfer payments. The state is struggling to find a way to cover a projected $42 billion budget deficit.

“I think it just reflects the severity of the problem,” said Jim Wiltshire, deputy director of the California State Association of Counties. “[F]olks are just trying to find a way to keep going.”

Terri Sexton, a taxation expert at the University of California–Davis, said she’s never seen anything like this grassroots revolt. But, as she notes, California “has never been in this fiscal position.”

But it is not only counties that are in rebellion. State Controller John Chiang, Lt. Gov. John Garamendi, Secretary of State Debra Bowen, Treasurer Bill Lockyer, Public Instruction Superintendent Jack O’Connell, Insurance Commissioner Steve Poizner, Attorney General Jerry Brown and the Board of Equalization have refused to accept Governor Schwarzenegger’s order to require 15,000 of their employees to work reduced hours.

On Monday, Schwarzenegger filed suit to force compliance.

Meanwhile, a panel of judges ruled Monday that the state must release between 24 and 37 percent of its prisoner population within three years. The panel said that California’s prison system is swollen to almost double its capacity and thus was violating prisoners’ constitutional rights. The ruling is expected to save the state between $800 and $900 million per year.

In other news, two more failed banks in California have been seized by regulators. Alliance Bank of Culver City and County Bank, Merced, were the 33rd and 34th banks to be taken over by the Federal Deposit Insurance Corporation since the recession began. Nine banks have been allowed to fail so far this year.

The state is also suffering a severe drought, with Los Angeles announcing what is, in effect, its first water rationing in its 200-plus-year history.

News out of California is mostly grim, but with the seeds of insurrection growing, things could be about to get worse. And that is bad news for America as a whole. California is often a lead indicator for the whole country. Watch California!

 

[Watchman]

Big Banks Won’t Accept California’s IOUs
July 9, 2009 | From theTrumpet.com


I
f things weren’t already bad enough for the Golden State, they just got worse. With a budget in shambles, politicians in gridlock, and the state in severe recession, the Wall Street big banks just kicked the people of California in the ribs when they were down. But will the blow boomerang?

On Tuesday, the Wall Street Journal reported that a group of big banks had decided that they would not accept California’s ious. The decision by Bank of America Corp., Citigroup Inc., Wells Fargo & Co., J.P. Morgan Chase & Co., and others came as a shock after the banks had basked in the positive publicity after initially saying they would work to help out the people of California by letting them exchange their government ious for cash.

State Controller John Chiang said that California will need to issue over $3 billion worth of ious just in July. If a budget isn’t passed by the end of the month, more ious will be issued.

Many Californians were depending on being able to cash the ious at their banks, so that they would be able to pay their bills. Without access to cash, many businesses may have to suspend or halt operations.

Fortunately for Californians, some smaller banks are still accepting the ious.

The decision by the big banks was especially unexpected, since these are the same banks that taxpayers, including Californians, spent hundreds of billions of dollars bailing out.

However, according to economic analyst Mike Shedlock, the big banks may be cutting their own throats. He says that unless the big banks have inside information that the ious will become worthless (which he doubts), the big banks could experience an exodus of customers as Californians look for other places to do business. California’s smaller savings and loans or credit unions could be the beneficiaries.

The big banks’ refusal to accept California’s ious could be a sign that the state’s finances are in worse shape than is generally recognized. On July 6, Fitch ratings agency cut California’s rating two levels to bbb. California’s credit rating is now only two steps above “junk” status. It also has the lowest rating of any state.

It is also possible that the big banks have come under political pressure from Washington to reject the ious so more pressure could be brought to bear on Californian politicians to pass a budget.

Another possible explanation is that the big banks’ own finances could be in far worse shape than is generally recognized. “It is very interesting that the big banks have reversed,” writes Aaron Krowne at ML-Implode. “This confirms my suspicion that, despite the bailouts, the banks are intensely in pain for cash to meet their obligations, and cannot make themselves further illiquid by accepting ious.”

Regardless of the explanation, the situation in California is deteriorating by the day. And passing a budget that will still probably contain multibillion-dollar deficits will not fix it.

To see why California’s problems are so much worse than those of any other state, read “Is California Under a Curse?” by Gerald Flurry. •

 

[ScarFace]

Insurrection? How dare you! You want a piece of me? Come get it!

 

[ScarFace]

“You sent a governor to Sacramento — not El Stiffo, like some in the past were,” Schwarzenegger said in a press conference yesterday. “[I am] someone a little bit more entertaining, and who has a little bit more fun with the whole thing, not have fun making the cuts — they sadden me — but fun with the job itself.”

 

[besotted]

California deserves to go to the dogs

People there lazy like fuck, don't want to work hard and want to live like a king, sign credit card for ten times what they earn

No fucking discipline, only think enjoy now enjoy now, never think of consequences, like a cheebye kia juvenile

No loss to the world if California collapses - stop polluting the rest of the world with its weakling values

 

[shelltox]

That;s what will happened when you spent more than you saved.