This would be the second time. I wonder when people will wake up?

From the Financial Times:

California will be forced to issue IOUs to public workers and other creditors in lieu of cash in the next two months if a budget deadlock cannot be broken, the state’s financial controller has warned.

America’s most populous state faces a repeat of 2009, when a slumping economy and its failure to agree a budget caused an unprecedented fiscal crunch and the issuing of $2.6bn of IOUs, which damaged California’s credit rating and forced it to scrap some social programmes.

John Chiang, California’s controller, told the Financial Times that the state was once again flirting with IOUs because of a budget stalemate between Arnold Schwarzenegger, its governor, and the state government. The budget is two months late.

Anyone think that maybe this “stalemate” is a smokescreen? Maybe the fact that California has no money has more to do with them issuing IOUs than any other reason. Once people figure out that California has no money the blood will run in the streets, so this financial kabuki is likely for the benefit of the angry, entitled masses. But the show can only go on so long.

If you’re in California now would be the time to leave.