home
***
CD-ROM
|
disk
|
FTP
|
other
***
search
/
Time - Man of the Year
/
Time_Man_of_the_Year_Compact_Publishing_3YX-Disc-1_Compact_Publishing_1993.iso
/
moy
/
071392
/
0713994.000
< prev
next >
Wrap
Text File
|
1993-04-08
|
1KB
|
34 lines
THE WEEK, Page 16NATIONState of Suspense
Sacramento tries a Depression-era gimmick: IOUs to pay its bills
As if drought, earthquakes, fire and floods weren't enough,
there was the recession and the riots and, now, for the first
time since the Great Depression, no more money. The beleaguered
state of California has run out of cash and is paying its bills
with IOUS.
The controller's office in Sacramento sent out the first
12,000 of the IOUs, euphemistically labeled registered warrants,
after the Democratic-led state assembly failed to reach
agreement with Republican Governor Pete Wilson on how to erase
a $10.7 billion shortfall in the latest state budget. Most of
the IOUS were for income tax refunds, but within days the state
will begin using the warrants to pay 34,000 part-time
employees. Most major banks are honoring the notes for now, but
they make no long-term promises. The budget impasse has left
thousands of state workers wondering whether the eventual
settlement will leave them without jobs; unemployment figures
released last week put the jobless rate in the state at 9.5%.
Meanwhile, if the budget battle is not resolved by the end of
this month, California may be forced to close schools, parks and
libraries.