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Schwarzenegger Lays Off 10,000 California Workers to Ease Budget Crisis

Saturday 02 August 2008

by: Dan Glaister  |  The Guardian UK

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Gov. Arnold Schwarzenegger cuts 22,000 state jobs and reduced 200,000 workers to the minimum wage. (Photo: Steve Yeater / AP)

Order could reduce pay of 200,000 to federal minimum. Move marks effort to reduce $15bn state budget deficit.

    Arnold Schwarzenegger, the governor of California, delivered on his threat to lay off thousands of state employees on Thursday when he signed an executive order in an attempt to solve the state's budget crisis.

    The move, dismissed by critics as a gesture to force legislators to reach a compromise on how to resolve the state's $15bn budget deficit, left more than 10,000 part-time and temporary employees without work yesterday. The order also reduced the pay of up to 200,000 state employees to the federal minimum wage of $6.55 an hour, below California's minimum.

    "I have a responsibility to make sure that our state has enough money to pay its bills," the Republican governor said as he signed the order at a press conference in the state capital, Sacramento. "It is a terrible situation to be in. I don't think any governor wants to be in this situation ... But this is really the only way out at this point."

    Critics, including the state controller John Chiang, a Democrat, disagree. Chiang, the state official who issues pay cheques, has said he will pay employees normally, arguing that Schwarzenegger does not have the legal authority to summarily reduce employees' pay.

    Referring to the employees as "the innocent victims of a political struggle", Chiang declared: "The state of California, the elected leadership, cannot put the important public servants of California in harm's way. We put people first, we make sure we protect their interests, and that's why I have to tell the governor, with all due respect, I am not going to comply with this order."

    Unions also declared their intention to challenge the order in court.

    California, the nation's largest state and one of the world's largest economies, regularly fails to agree a budget by the annual July 1 deadline. Officials from the governor's office claimed the lay-offs could save the state up to $100m a month, while the pay cuts would save up to $1.2bn a month if applied to all 200,000 eligible workers.

  

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Comments

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We voted for this governor

 Sat, 08/02/2008 - 20:06 β€” Anonymous (not verified)
We voted for this governor who tells us that reducing the pay of workers and forcing them out of work is the best possible remedy to the state's budget crisis. On the other hand, the people themselves apparently voted for the governor who treats them like serfs. Be careful what you wish for, or in this be careful whom you vote for.

What's wrong with this

 Sat, 08/02/2008 - 23:04 β€” Anonymous (not verified)
What's wrong with this Schwarzenegger? Is he senile? This is by far the stupidest thing he has ever done!

Arnold ought to be recalled

 Sat, 08/02/2008 - 23:22 β€” David (not verified)
Arnold ought to be recalled immediately! This would be the perfect moment to do it as well as a fairy-tale ending to his dirty confiscation of Gov. Davis' legitimate governorship, which occurred only because Republicans flexed their muscles - with the help, of course, of nasty Republican operatives like Karl Rove. Why, I ask, is there not an immediate reaction among liberal Democrats in CA to start accumulating signatures? They would have these signatures in no time at all! Striking back is the only way to deal with these Republican bastards - who've got billions for Iraq and no respects or love for citizens of this country. I say, let's hit these anti-government, shock-loving "Friedmanites" hard and bring them down with some unexpected activism just when they expect it least - let's take Arnold down with a recall. Let's give them a taste of their own medicine. An Arnold recall would indeed "fly" and, furthermore, Arnold would be rightly and profoundly humiliated by the entire process. That humiliation would work well to uproot, in advance, his run for the Senate. His humiliation would be both effective politically and emotionally delicious. Let's do it, Democrats! I tell you, this would fly! MoveOn should call for this type of action right now!

What in the World is wrong

 Sun, 08/03/2008 - 06:11 β€” Number 9 (not verified)
What in the World is wrong with that gov.? Putting people out of work and cutting pay is a none answer.

New York State is nearly a

 Sun, 08/03/2008 - 14:34 β€” Anonymous (not verified)
New York State is nearly a hundred BILLIONS in the hole. NOWHERE is there ever said a word about it. You see, the ONLY stable employment and means of transferring money into the communities is thru the gov-med-edu cartels. All private means and especially enterprise is gone. It is interesting to watch other states, especially the giants of TexAS AnD cALIFORNIA, try to keep ordinary American economics working. Arnold is not really doing wrong, but the writing is on the wall. You cannot have free enterprise and socialism operating together, or can you? America's experiment with democracy is far from finished, and the economy question is deepening daily, but where personal liberty has been cut down, one cannot expect business to thrive. California is a remarkable system, and the reduction of it's public employed wages will probably not damage much or leave her shorthanded. Carry on.........

Why doesn't he cut the

 Sun, 08/03/2008 - 15:14 β€” Anonymous (not verified)
Why doesn't he cut the salary of all employees or the highest paid ones or his own salary? This is really sick. The poorest are to solve the money problems of the rich.

When you're in a hole - STOP

 Sun, 08/03/2008 - 17:17 β€” Anonymous (not verified)
When you're in a hole - STOP DIGGING! Schwarz can't get the legislators to pass a balanced budget, so he's shutting down the spending. I bet all of you jokers excoriating him also have house mortgages and credit card bills you can't pay for. Arnold is just doing the responsible thing.

Another example of the

 Sun, 08/03/2008 - 17:33 β€” Anonymous (not verified)
Another example of the damage done to the public interest when Rupublicans steal into office (whether by "special elections" or election fraud). While attacks are made against public employees (including teachers... CA educators lack adequate funding), there is an effort in CA to privatize many government functions. For example, IT projects are being put on hold so the state CIO can attempt to centralize control and create a state-wide dependency on large corporate suppliers such as Microsoft. This suppresses individual contribution and public value solutions such as open source systems, while creating lucrative deals for corporate donors.

So, the same taxpayers who

 Sun, 08/03/2008 - 17:55 β€” leftyrite (not verified)
So, the same taxpayers who involuntarily bailed out Countrywide Mortgage and Bear Stearns and Fannie Mae and Freddie Mac are now being told by the Kindergarten Cop that the cupboard is bare and that they must sympathize with him, of all people. That's truly rich, in the most vulgar sense. My bet is that the California Retirement Fund will also be ruined by the end of this, if its fate hasn't already been determined. Will the Governator give up a house or a Hummer or the right to be his special self? That's not the Republiucan Way.

I notice that nothing was

 Sun, 08/03/2008 - 20:01 β€” Anonymous (not verified)
I notice that nothing was said about the managerial positions, such as his own. Before consigning the most vulnerable to abject poverty, the Terminator might have reduced the bloated salaries first. But, of course, his kind must flourish at all costs.

Triggering a state workers'

 Mon, 08/04/2008 - 13:35 β€” Nguyen (not verified)
Triggering a state workers' strike by provocatively slashing wages down to minimum and laying off all part time workers would have the effect of allowing them not to pay payroll. It could be that the Schwarzenator is trying to trigger something.