Out of Control Policy Blog

California's Hidden Deficit Keeps Growing

It is probably not astonishing to most of you that Uncle Sugar has quietly loaning billions of dollars to states to help them keep up with high unemployment benefit demand--$37.8 billion so far according to a report from EconomicPolicyJournal.com. And I guess it is also not surprising that California is WAY out front in the borrowing, snarfing up 20% of the total. Yep, California has borrowed $6.9 billion so far.

Interesting and convenient that Gov. Schwarzenegger does not count this LOAN in his estimate that the state's deficit is $20 billion. Nor does it show up in the state's accounting of debts. Hmmm.  Maybe just like he counts in his budget on billions in federal bailout funds that have not been planned, let alone committed, he just assumes the feds will waive this debt too.

If wishes were fishes, we'd all be eating caviar in California.

Hat tip to CAPoliticalNews.com.

Adrian Moore is Vice President, Policy


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