Governor says state workers must share economic pain

Gov. Arnold Schwarzenegger says his attempts to cut state workers’ pay to the minimum wage level pose “no real burden” on state employees because banks are offering loans to state workers whose pay is cut. “So, I think we all have to make certain sacrifices,” the governor said.

The lame-duck Republican governor, in comments this week to a gathering of the Central California Hispanic Chamber of Commerce in Fresno, offered an unusually detailed view of the impact on state workers of his budgeting proposals. His statement came in response to a question from a member of the audience, who asked, “Why do state workers have to bear the burden of fiscal mismanagement?”

The governor said the three-days-per month furloughs and pay cuts are no more onerous than the pain already felt by workers in the private sector.

State employees, he said, “don’t have to take on an extra burden.” In the private sector, “people are losing a lot of money as we speak right now. People are losing their jobs. People are losing their homes. People are losing their businesses. People are losing their families because of the stress and all of this. I mean, there is tremendous, tremendous hardship and pain that is being experienced all over this country in the private sector.”

But, he added, “none in the public sector. They still get the same wages, they all still have their jobs. Everything is the same, except, Oh yes, I forgot: They got three furlough days last year. Well, excuse me. Does that mean they’re the only ones that are being hit with making some sacrifices? I mean, it’s crazy to even ask that question.”

The governor noted that he does not take a salary as governor, although his political supporters pay for the cost of his lodging while in Sacramento, and some of his travel costs.  He also said he does not have ill feelings about state workers, although he said they needed “a little haircut.”

“I mean, I like my state employees. I think they’re working hard. We’re not taking anything away from any state employee. But when the whole country, all of a sudden, the whole country’s GDP (Gross Domestic Product) goes down, and the state’s GDP goes down, and the whole world is, all of a sudden, 20- to 30-percent worth less, then everybody ought to go and distribute this kind of pain a little bit and get a little haircut. So, therefore everyone should be reducing their salaries, their wages and their benefits and everything. So I’m not going after state employees, no. I’m just asking them to participate a little bit with the pensions and then with the furloughs.”

The state faces a $19 billion budget deficit, and the state is six weeks past the July 1 beginning of the 2010-11 fiscal year.

Schwarzenegger and the Legislature have been unable to reach agreement on a new spending plan, and there is no indication that an agreement will be reached in the near future. Lawmakers returned Monday from a summer recess to resume negotiations.

On Tuesday, the L.A. Times reported that Republicans sharply rejected budget-balancing proposals from Democrats in both houses. The Democrats’ plan included lowering the state sales tax from the current 6 percent to 3.5 percent by next July in return for an increase in personal income taxes and vehicle registration fees.

Nearly two-thirds of taxpayers who do not itemize deductions on their income tax forms would wind up paying more, said Assembly GOP Leader Martin Garrick, R-Solana Beach, although Democrats said there would be a net tax decrease for all brackets. They also noted that the $52 billion that Democrats have set aside for schools is more than $3 billion above the school spending proposed by Schwarzenegger.

The governor, however, made it clear in Fresno that he opposed new taxes.

“We increased taxes last year, the biggest tax increase in the history of California. Why do some people recommend double dipping all of a sudden and go back and ask for more taxes? That’s crazy,” he said.

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