California Takes The King's Shilling . . .

by Pejman Yousefzadeh on May 8, 2009

And as a consequence, it cannot even have the power to balance its own budget:

The Obama administration is threatening to rescind billions of dollars in federal stimulus money if Gov. Arnold Schwarzenegger and state lawmakers do not restore wage cuts to unionized home healthcare workers approved in February as part of the budget.

Schwarzenegger’s office was advised this week by federal health officials that the wage reduction, which will save California $74 million, violates provisions of the American Recovery and Reinvestment Act. Failure to revoke the scheduled wage cut before it takes effect July 1 could cost California $6.8 billion in stimulus money, according to state officials.

The news comes as state lawmakers are already facing a severe cash crisis, with the state at risk of running out of money in July.

The wages at issue involve workers who care for some 440,000 low-income disabled and elderly Californians. The workers, who collectively contribute millions of dollars in dues each month to the influential Service Employees International Union and the United Domestic Workers, will see the state’s contribution to their wages cut from a maximum of $12.10 per hour to a maximum of $10.10.

The SEIU said in a statement that it had asked the Obama administration for the ruling.

Shorter Obama Administration: “Rewarding unions–who are, after all, allied with the Democratic party–takes precedence over encouraging states to be fiscally responsible.”

And people are surprised when various Republican governors express hesitation over taking even part of the stimulus funds? If one loses independence as a consequence and the federalist system is undermined by having state governments placed under Washington’s thumb even more, why should anyone think that taking stimulus money is a good idea?

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