California Tax Problem will Become National Problem

Back on January 3 2009, I wrote and posted an article Fair Tax, The Ultimate Economic Stimulus Package. It was based on the story I read about ” Pitchfork and Torch Alert: California May Issue IOU’S for Refunds.”

Within 3 weeks here I am reading again That California’s woes continues (article below). When I talk to people about the severity of our country’s taxation problems, I wonder if people are just waiting for our government to do something? I hate to tell you, but the government will do exactly what is happening in California all over the nation. Please do you get it now? California one of our most important states in United States. Now they are our first state that CANNOT pay its citizens’ back their tax money – that belongs to them in the first place! So what are we waiting for? The Government You Say to do something? How many more states are waiting to be next? I will tell you it will not be long. Think again if you think a stimulus package or bailout will fix the problem. Well my friends where do you think the government gets it’s money for this bailouts and stimulus packages? From you the Taxpayer! When the doors of our government close then what?
I am warning you the taxpayer we have to change to a FairTax, before this domino effect from California starts to spread. Please we need to pass the FairTax Bill. Tell all the members in the Senate and the House of Representatives to sit down and listen to “We the People of the Untied States” that are paying the taxes. We the People of United States own the offices that we put these elected officials in, that we want FairTax. It is our Constitutional right and we can tell these elected people – who are no different than you and I – to listen to us.
Please read what our friends, family and countrymen of ours are going through, let help them out by saving ourselves from this very tyranny:

From the LA Times:
California controller to suspend tax refunds, welfare checks, student grants
John Chiang announces that his office will suspend $3.7 billion in payments owed to Californians starting Feb. 1, because with no budget in place the state lacks sufficient cash to pay its bills.

By Evan Halper and Patrick McGreevy
January 17, 2009

Reporting from Sacramento — The state will suspend tax refunds, welfare checks, student grants and other payments owed to Californians starting Feb. 1, Controller John Chiang announced Friday.

Chiang said he had no choice but to stop making some $3.7 billion in payments in the absence of action by the governor and lawmakers to close the state’s nearly $42-billion budget deficit. More than half of those payments are tax refunds.

The controller said the suspended payments could be rolled into IOUs if California still lacks sufficient cash to pay its bills come March or April.

“It pains me to pull this trigger,” Chiang said at a news conference in his office. “But it is an action that is critically necessary.”

The payments to be frozen include nearly $2 billion in tax refunds; $300 million in cash grants for needy families and the elderly, blind and disabled; and $13 million in grants for college students.

Even if a budget agreement is reached by the end of this month, tax refunds and other payments could remain temporarily frozen. Chiang said a budget deal may not generate cash quickly enough to resume them immediately.

Not all payments will stop Feb. 1. Most school and health care programs will be paid, as required by state and federal law. The state will continue to pay more than $6.6 billion in such bills.

And Los Angeles County officials said they would cover welfare payments to more than 500,000 local recipients — for now.

But California is projected to be $346 million short of the funds it needs to pay all its bills in February. By March, the state would be so far in the red that even continuing to suspend payments would not cover the shortfall. California would be insolvent, making the issuance of IOUs likely.

State officials have already designed an IOU template, Chiang said, and have been negotiating with banks over whether taxpayers could cash or deposit them if they are issued. The state could be forced to pay as much as 5% interest on delayed tax refunds if they are not paid by the end of May, Chiang said.

The last time the state issued such IOUs — the only time since the Great Depression — was in 1992.

The suspension of payments is the latest radical move by officials to help keep the state from running out of cash as Gov. Arnold Schwarzenegger and the Legislature battle over how to avoid insolvency.

Schwarzenegger, who hopes to speed up public-works projects to stimulate the economy, wants tax increases, spending cuts and legislation to relax some environmental rules and allow private companies to do some government construction.

Democrats are seeking tax increases as well, but fewer spending cuts. Republican lawmakers would only pare spending and have been blocking any tax hikes.

Meanwhile, Schwarzenegger has ordered that most state workers take two days off per month without pay — equivalent to about a 10% pay cut. The governor also ordered most state offices — including all DMV field offices — to close on those two days. The order is being challenged in court by labor unions.

The state has also halted payments of bond money for more than 5,300 public-works projects.

On Friday, the state Department of Finance temporarily exempted 276 of the projects from the freeze, reasoning that because they are nearly complete, it could cost the state more to shut them down than to finish them.

The exemption, through Feb. 1, will allow the continuation of school construction by the Inglewood Unified School District and the construction of a new Court of Appeal facility in Santa Ana. Work on new rail tracks at L.A.’s Union Station and road projects involving Irwindale Avenue, Martin Luther King Boulevard and Imperial Highway in Los Angeles County will also be able to continue.

Some projects were exempted because the state is under court order to do the jobs. Others would threaten public safety if left uncompleted, according to Mike Genest, Schwarzenegger’s finance director.

“We’re going to take the risk of allowing them to continue a little longer because we are very hopeful will have a budget by Feb. 1,” Genest said…..

Related Stories:
* In San Diego, financial free fall — and…
* California to delay some payments
* Southern California officials draw up wish lists for federal stimulus money

Reading that last sentence above: “Southern California officials draw up wish lists for federal stimulus money” and whos “federal stimulus money” would that be? Everyone who is paying taxes outside California, Yours! Do you have the tax money? You better California wants it! So where are you going to get it from if you don’t have it and California is drawing up a wish list for your tax dollar?

Please re-read this article again, so it will really sink in what is happening to all of us: Do we want to be remembered as the generation who did nothing for the country of these United States? If not then Pass The FairTax Bill – the only Ultimate Economic Stimulus Package – before we all end our country like this …………..

Charlie Prochaska
Volunteer Community Coordinator
FairTaxSOWEGA