California budget in free-fall as new round of cuts is proposed

Governor Arnold Schwarzenegger called the state legislature into special session on November 6 to deal with the current crisis, less than two months after he and the legislature finally enacted an austerity budget for fiscal year 2008-2009—three months after the legal deadline.

The latest crisis was precipitated by the international credit freeze, which has prevented California from obtaining the private loans on which the state relies to fund government operations during the autumn and winter months before the collection of state income tax revenue in April.

The 2008-2009 budget included $7.1 billion in cuts of social spending, including $2.9 billion slashed from public education, a $950 million reduction in public transit services, and a 10 percent decrease in state Medi-Cal services. Schwarzenegger is now seeking much deeper cuts in these and other social programs, along with regressive tax increases that will most affect the state's working class and poor.

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http://wsws.org/articles/2008/nov2008/cali-n25.shtml