I just read this brief news item on CNN online:
California may need a quick $7 billion loan from the federal government to pay for “teachers’ salaries, nursing homes, law enforcement and every other State-funded service” this month, Gov. Arnold Schwarzenegger warned in a letter sent Thursday to the U.S. Treasury secretary. The letter, posted on the Los Angeles Times Web site Friday, echoes a statement issued a day earlier by California State Treasurer Bill Lockyer, saying the state has been locked out of credit markets for the past 10 days because of the national financial crisis.
I sure wish someone would tell me why borrowing more money is the way out of this financial crisis.
The Federal government, state governments, and even school districts across the country are experiencing budget overruns and their response is to borrow money to pay for it. Isn’t excessive borrowing what got us into the mortgage crisis, the national deficit, and the banking crisis?
Here’s a novel idea. One taken from the budget plans of so many Americans who don’t run up excessive debt. Don’t spend any more money than you take in.
Let me repeat that, just in case someone missed it. Don’t spend any more money that you take in.
And to borrow another approach from a family budget, pay for the necessities first, then consider luxuries.
To cover the shortfall in California, I suggest that they cut excess government. Don’t pay salaries for top government officials for six months. Stop all travel and entertainment expenses for six months. Stop all advertising for six months. Maybe then they would have enough money to pay the teachers and police officers.
As to the Federal deficit. Instead of cutting taxes, cut out the obscene retirement packages that legislators receive. Freeze all pay for top government officials for six months. Freeze overseas aid for six months. Freeze all nonessential travel for six months.
Then when we can all breath a little easier, I challenge the leaders of our country to go through government and trim, trim, trim. I’m sure there would then be enough money to support our troops, support social security, and offer aid to the most needy in our country.