California voters overwhelmingly rejected five of six budget referendums yesterday which would have approved higher taxes as a means to patch budget woes in the Golden State. Had the measures passed, the state would still have faced a $15.4 billion deficit. With the failure of the measures, the state now grapples with $21.3 billion in red ink.
Out of control spending and high taxes driving business out of state are at the core of California’s budget problems. Now voters in a tax revolt have overwhelmingly rejected more of the same from California lawmakers, choosing instead a path that could force budget cuts and spending restraint. Imagine that.
The only measure on the ballot that passed was one that bars state officials from receiving a pay increase during tough economic times.
Rep. Barney Frank (D-Mass.), chairman of the House Committee on Financial Services, has made noises about crafting legislation to offer the State of California a bailout in the form of federal loan guarantees for state municipal bonds. A California bailout would not only set a very dangerous precedent with the majority of states now drowning in red ink, but the size and scope of California’s economy could put America’s AAA credit rating at risk. It is yet to be determined if any sort of state bailout legislation has enough votes for passage.
If California doesn’t get a bailout, the State Controller can sell Registered Anticipation Warrants or RAWs to solve their cash flow crisis. It is likely that investors would buy RAWs because it is a personal felony for the State Controller to fail to pay off these warrants as cash becomes available. Default is not an option. The action would place California on a pay-go system which would compel budget accountability, forcing liberals off of their spending binge cold turkey.
This is one time the adage “as California goes, so goes the nation” may just be a good thing.
McConnell Continues to Hammer Administration on Gitmo
Senate minority leader Mitch McConnell (R-Ky.) yesterday continued pressuring Democrats from the Senate floor hammering the Obama administration over its desire to close the state-of-the-art detention facility at Guantanamo Bay by January with no plan for the dispensation of the 241 hard-core terrorists housed there. The administration has floated ideas ranging from moving the facility onto U.S. soil or moving the terrorists into the American prison system to a scheme to release some of the terrorists outright into our communities. The so-called justification for this absurd notion was an attempt to show European critics — who won’t take the terrorists — that it is safe to take these terrorists into their communities.
“It’s hard to imagine that moving this facility somewhere else and giving it a different name will somehow satisfy our critics in European capitals,” McConnell said. “Even less likely is the notion that by moving detainees from the coast of Cuba to Colorado, terrorists overseas will turn their swords into ploughshares.”
Ouch. That left a mark.
Due to the unending pressure from McConnell and other Republicans, Senate majority leader Harry Reid (D-Nev.) was forced to take a public stand against the President yesterday, striking $80 million in funding slated for closing Gitmo from the War Supplemental currently before the Senate.
“Democrats under no circumstances will move forward without a comprehensive, responsible plan from the President,” Reid said at his press conference yesterday. “We will never allow terrorists to be released into the United States.”
Barney Frank Grants ACORN Further Eligibility for Millions More in Funding
Since 1994, ACORN has directly received a minimum of $53 million from American taxpayers and could be eligible for another $8.4 billion in taxpayer funding between the “stimulus” bill and the 2010 budget according to Rep. Michelle Bachmann (R-Minn.). Bachmann held a press conference to focus on recent maneuvers by Democrats to block attempts by Republicans to withhold federal funding from ACORN while they are under federal investigation for voter registration fraud.
The House recently approved another $140 million for foreclosure legal assistant grants, more money ACORN will be eligible to receive. Rep. Barney Frank (D-Mass.) gutted attempts by Bachmann to bar ACORN from eligibility for these grants.
“Congress has been far too loose with taxpayer’s money for far too long,” Bachmann said. “It is a shameful abdication of our fiduciary duties and yet another example of Washington’s disrespect for the taxpayer. We owe it to our constituents who are already weary and frustrated and outraged by the cycle of spending and bailout and taxing and borrowing to at least show them that we won’t pick their pockets to fund groups that abuse their trust over and over and over again.”