On that income tax rebate, awww I only managed to save 66% of mine . . . but it’s not in the bank. It’s part of a safely stashed fund in case the equity in my banking institution plays kissy face with a financial neutron bomb over the next 18 months. Cash flow matters, and especially at my level of the economy. And no, it’s not in a mattress, either.

John Chiang = Kyle Reese. Look, the Gubernator is and always has been totally financially irresponsible in office. During the good times, he refused to take in even adequate revenue to fund existing committments _including those he personally pledged to support_. Instead, the State of California at his initiative took on tens of billions of dollars of debt during our nominal expansion. Now, their budget constrainsts are severe. So what is the brave, manly Gubernator doing?: Holding a sharpened pen to the throats of the state employees since the Legislature refuses to fire them en masse at Arnie’s wiggy whim. Could it be that the facts that those unions are the major contributors to Democratic legislative candiates and this is an election year have any influence upon the Gubernator’s present performance as a public menace? Arnie hopes to ‘drown tens of thousands of union members in the deficit bath tub,’ I don’t doubt, a wish clearly always near to his fondest. My advice: A shotgun, Mr. Chiang, speaking metaphorically, loaded with a 200k dust shot charge of cheques, and stay light on your feet.

[Full disclosure: One of my relatives _is_ a California state employee. But the Gubernator can't touch his salary, which is set under a court order that resulted from the Golden State shirking its ethical, statutory, and human rights obligations for years _as a matter of policy_. And in the end, that is where future California fiscal policy will be decided, in my view: the courts will have to set things right because too much of the citizenry puts fantasy above sense or the law.]

“some are calling a misrepresentation due to tinkering going on with the added unemployment extensions WSJ)”
Re: Furthermore, President Bush signed a bill last month that extends unemployment benefits to as much as 13 weeks for some. In an effort to notify hundreds of thousands of Americans about the extension, the Labor Department discovered many were eligible for initial unemployment claims – not just an extension of benefits.

The Labor Department said some of these people had intervening wages such as a temporary summer job that qualified them to reapply for jobless insurance benefits. As a result, the government said many valid claimants who did not previously know they were eligible applied for new benefits.

http://money.cnn.com/2008/07/31/ …sion=2008073110

The Governor errs in relying on the Supreme Court’s decision in the White v. Davis case to support his proposed reduction of State employee paychecks to the federal minimum wage in the absence of a state budget. Here is why.

In non-binding remarks, the Supreme Court cast some doubt on the Controller’s “impracticability” argument; however, it remains a live issue that current Controller John Chiang can pursue, given that the State payroll system has not changed and will not have the capacity to timely adjust and segregate the employees who must be paid full salary from those who could legally be paid minimum wage.

WHEREAS the constitutional deadline for enacting a state budget for Fiscal Year 2008-09 has passed without the enactment of a budget; and

WHEREAS in the absence of a budget, State government is constitutionally prohibited from making payments that are not compelled by either the State Constitution or federal law; and…

http://wagelaw.typepad.com/wage_law/2008/07/schwarzenegger-to-make-state-workers-pay-for-legislators-budget-dispute.html

California needs $2.5 billion cash on hand to pay its operational expenses, including the payroll. But by the end of September it is projected to have only $1.8 billion left on its coffers.

State controller John Chiang said he would continue to pay California employees their full pay even if the governor signs the executive order. Chiang insisted California has sufficient money to meet its payroll until September. “Cutting workers’ salaries will do nothing meaningful to improve our cash position… It is nothing more than a poorly devised strategy to put pressure on the Legislature to enact a budget,” Chiang said in a statement.

With California’s cash dwindling and legislators still debating a new budget, Gov. Arnold Schwarzenegger eliminated 22,000 part-time and temporary state positions Thursday and ordered that 200,000 state workers receive the federal minimum wage.

Just keep cooking the books…

The unemployment rate is a relatively modest 5.5%. But that’s because companies have figured out how to convert full-time employees who have benefits like health care into part-time ones who lack benefits and whose hours can be cut back at will. This is a great deal for companies and a lousy one for workers. And it is ultimately bad for investors.

thus providing banks with some much-needed cash deposits.