(California) Judge issues restraining order blocking Schwarzenegger from implementing furloughs

[alp227]

Source: Los Angeles Times

Roughly 150,000 state workers could avoid unpaid furlough days set to begin Friday after an Alameda County Superior Court judge issued a temporary restraining order on Monday blocking Gov. Arnold Schwarzenegger from forcing the mandatory time off.

Schwarzenegger ordered the furloughs in late July, four weeks after the fiscal year began with no state budget in place. The governor said the move was necessary to conserve cash, at least until state legislators approve a spending plan.

The governor's office said it would immediately appeal Monday's ruling.

Schwarzenegger previously ordered workers take unpaid furloughs to save cash-strapped California money from February 2009 through June 2010.

Read more: http://www.latimes.com/news/local/la-me-furloughs-20100810,0,2507530.story

[melm00se]

1. Can someone help me understand

what the realistic options that California has to close it's budget gap?

California is already the 9th highest taxed state (http://www.statemaster.com/graph/eco_tot_tax_bur-total-tax-burden-per-capita) in the USA.

the options as I see it are either (or both) cut spending and/or raise taxes.

Am I missing something here?

[slackmaster]

2. That's about the size of it

Taxes on the middle class can't be raised because most voters feel they are already paying more than their fair share in taxes.

Taxes on businesses are already so high that businesses are leaving the state, taking jobs with them.

Spending can't be cut because of contractual obligations and the influence of public employee unions.

Legislators won't raise taxes on the wealthy because they just won't.

[Imajika]

3. Which basically means...

...that California is simply spending far more than its people are willing to pay for.

Not real complicated.

I understand the unions fighting against the furloughs and pay cuts, but I wonder if most people realize that the result will simply be to fire more state workers.

The state aid that just passed is already included in the budget and CA is STILL running some astounding deficit - and this will be the last state aid money for probably 2 years at least. After November, there will be virtually no chance to send anymore help to the states until at least 2012.

[slackmaster]

4. Blocking the furloughs forces the state to borrow more money at high interest

The state's credit rating is already in the crapper.

[Winterblues]

5. The ONLY realistic option is to rid itself of all Republican influence.

It is just that basic... No one likes taxes but for ANY society to exist they must exist as well, and those that have more need to be taxed more..Unless anyone can point to any country that is healthy and prosperous that does not tax it's wealthiest citizens the hardest, I think it is obvious.

[melm00se]

6. how does a state

(as in a subset of a nation) tax their wealthiest without driving them out of the state to one where the tax burden isn't as high?

as indicated in a prior post, businesses are leaving the state of California because of their tax burden, how do you stop that from happening with the rich?

[Lightning Count]

7. Only way I can think of is a large tax penalty for leaving the state.

That is not an attractive option at all though.

[Imajika]

8. Well, this is the argument for a stronger Fed Govt...

...and weaker states. As of now the states compete with each other and what you point out is exactly what happens. Raise taxes on the wealthy and they just pack up and head to a state that promises to tax them less. Politicians of both parties do it. They want more business and more jobs, so they will do things like run ads in California promising a lower tax environment in say Colorado. States are constantly wooing business and entrepreneurs this way.

If the Fed has the bulk of the power, the same tax policy applies across the board and there is no way to escape unless the company or person flees the country.

As long as we have 50 states competing with each other, and counties and cities within the states competing with each other, there is simply no way to completely prevent businesses and rich people from just leaving. Once they leave, states then start cutting their own business and personal tax rates to woo people back and the cycle goes on and on. The one thing you can do is make the results of the state spending so good that businesses/rich people think the investment is worthwhile. Lots of great new roads, fantastic schools, etc. But if the taxes don't go to anything business feels adds value and makes them more money, they very often just leave and currently there is just no way to really prevent it.

[Stargleamer]

12. I'm not convinced

that higher taxes would drive the rich out of Calif. For one thing, where would they go? Nevada? Oregon? Don't they have jobs and homes in California? Did the rich leave Massachusetts (Taxachusetts according to Republicans) for Arkansas? Republicans always say "the rich will leave." Supporting evidence that they do leave to a significant extent is often not forthcoming. And yes, I'm aware of the Bahamas and other islands in the Caribbean that they are supposed to flee to).

[yurbud]

10. our property taxes are very low, and we can't raise taxes because our constitution

requires a 2/3 vote to pass a budget or raise taxes, so the Republican minority holds the budget process hostage.

[gratuitous]

9. The governator can't just impose unilateral contract changes?

Who knew?

The first thing California needs to do is repeal their fucked-up provision that requires a supermajority for any tax or fee increase. This essentially holds the state hostage to a minority of Grover Norquist types who oppose any tax code changes, knowing that their ignoramus base will always vote for the candidate who "fought the biggest tax increase in California history." Those same voters will curse the potholes in the road they have to drive to get to the polls, and wonder why the school where they're voting is so run down. And never make any connection between the ballot they cast and the conditions they see.

[rocktivity]

11. Bet you wish you had that six billion you gave Enron, huh, Arnie?

:evilgrin:
rocktivity