A California appeals court has upheld an Order by Gov. Arnold Schwarzennager temporarily cutting state employees back to the federal minimum wage since the California legislature has not passed a budget and is facing a $19 billion annual deficit. As reported in The San Francisco Chronicle:
The governor has the authority to lower most state workers’ pay to the federal minimum wage if a state budget isn’t in place, a state appeals court ruled Friday, the second day of California’s 2010-11 fiscal year.
The ruling came one day after Gov. Arnold Schwarzenegger ordered the state controller to cut pay for about 200,000 state workers to the federal minimum wage of $7.25 an hour. The court case began in 2008, when Schwarzenegger made a similar order. Controller John Chiang, a Democrat, defied the demand and was sued by the Republican governor, but a budget was approved before the case was resolved.
In Illinois, the state simply has stopped paying bills (emphasis mine):
Even by the standards of this deficit-ridden state, Illinois’s comptroller, Daniel W. Hynes, faces an ugly balance sheet. Precisely how ugly becomes clear when he beckons you into his office to examine his daily briefing memo.
He picks the papers off his desk and points to a figure in red: $5.01 billion.
“This is what the state owes right now to schools, rehabilitation centers, child care, the state university — and it’s getting worse every single day,” he says in his downtown office.
Mr. Hynes shakes his head. “This is not some esoteric budget issue; we are not paying bills for absolutely essential services,” he says. “That is obscene.”
These scenes, to greater and lesser effect, are being played out in states and municipalities around the country, as decades of unsustainable budgets, union contracts, and pensions, are meeting up with reality. We are all Central Falls now.
The federal government is not far behind, and is forcing regulation and taxes on the economy which severely damage private job growth.
The path of big government and the welfare state is the path to broken promises and inter-generational warfare. The workers in California and vendors in Illinois are paying the price for the unsustainable public sector union contracts which preceded them, sometimes by decades.
Yet those of us who call for fiscal sanity and reform are derided by people like Sheldon Whitehouse and other Democrats as having no compassion.
Just the opposite is true.
It’s called tough love. Those who feed the big government addiction are the cruel ones.