Schwarzenegger Threatens to Shut Down the State

Democrats in the California state assembly employed a series of legal maneuvers to push through a proposal to balance the state's $24 billion budget deficit without any Republican votes over the weekend.

The plan, which includes $11 billion worth of cuts and $10 billion worth of accounting maneuvers, is now in the state senate.

California Governor Arnold Schwarzenegger has threatened to veto the plan on principle, should it reach his desk, because it contains $2 billion worth of revenue solutions consisting of an oil severance tax and a tax on cigarettes, measures that Schwarzenegger himself had previously proposed.

If Schwarzenegger believes that it is possible to balance the state budget without these revenue solutions, as paltry as they are, then he just doesn't understand economics.

Should he actually follow through on his threat to veto the Democratic plan, blame for shutting down the state would rest squarely on his shoulders.

While Schwarzenegger has been prone to using threats, coercion, and other ham-fisted approaches to realize the vision of a state with no capacity to provide social or educational services to the citizens of California, it is unclear whether he actually has the courage to take the blame for shutting down the state.

With California just a few days away from having to issue IOUs to pay its bills, the only way to win this game of budget chicken and avert the prospect of California taking its place among the Third World, an outcome that corporatists like Schwarzenegger and the Republicans have been planning for decades, is for Democrats to concede nothing and place a budget on Schwarzenegger's desk that includes new revenues.

This will put Schwarzenegger into a position where he will either have to make good on his threats or look like a complete hypocrite. If past performance is any indication, he will find an excuse to sign it.