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.
Halper and Patrick McGreevy, Los Angeles Times, January
World Economy and the Financial Meltdown
Comment by Wes Penre: Although we, the
people, are ultimately responsible because we let
this happen, the moral of this story is: Let the
rich intentionally screw up the economy to make
people terrified, then to hammer the last nail into
the coffin, let the "victims" pay for it while the
perpetrators go free and get even richer!
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
controller said the suspended
payments could be rolled into IOUs
if California still lacks sufficient
cash to pay its bills come March or
"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
Not all payments will stop Feb. 1.
Most school and healthcare 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
Democrats are seeking tax increases
as well, but fewer spending cuts.
Republican lawmakers would only pare
spending and have been blocking any
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
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
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
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,"
Contractors lined up at a meeting of
state finance officials to warn of
the consequences of stopping the
bulk of the public-works money. They
said shutting down projects already
underway would ultimately cost the
state significantly. According to
Caltrans Director Will Kempton, the
state would have to pay $350 million
in legal costs, claims for contract
breaches and expenses for securing
sites that go dormant.
"The bulk of those dollars are lost
. . . to the taxpayers," Kempton
said. "You can't just walk away from
a construction project. You have to
make sure it is buttoned up."
It is not just the state that would
take a hit. Some school districts
relying on state funds do not have
the reserves in place to cover the
payments they will owe builders if
Counties are also feeling the pinch.
They process the welfare payments
scheduled to be halted by the
controller's office Feb. 1. The
state is freezing those payments,
along with millions of dollars in
salaries to county workers who run
Some county officials say they don't
have reserves in place to cover the
state until the budget crisis is
"We simply don't have the cash,"
said Pat Leary, assistant
administrator for Yolo County. "We
are in critically bad times."
About a third of all state welfare
payments go to Los Angeles County,
where officials said they can shift
money around to keep the payments
flowing in the short term.
"The million-dollar question is how
long this will last," said L.A.
County Chief Executive William T
Fujioka. "We cannot sustain a huge
and very long hit."
Want your opinion to be heard?
Make a comment
have it posted here, uncensored and unedited!
as long as it's written in a civilized manner.
Write me an email
and put the same title in
your email subject line as the name of the article you want
to comment on. You can be anonymous if you like,
or write under a pseudonym. Wes Penre.
The word Illuminati means 1.
People claiming to be unusually
enlightened with regard to a subject. 2.
Illuminati: Any of various groups
claiming special religious
enlightenment. Latin illmint,
from pl. of illmintus,
past participle of illminre,
to light up. See
These definitions are taken from "The
American Heritage Dictionary of the English Language".
definitions tell us, any group which considers itself "enlightened"
could rightfully call itself the Illuminati. So is also the case! If
you google "The Illuminati", you will find quite a few groups
claiming this name. It can be confusing, so before we continue, I
want to make very clear that the Illuminati we are discussing here
is NOT a benevolent secret society who wants to bring peace and
harmony to this world by helping to bring back freedom to the
people, at least not in this "reality". If such a benevolent group exists and also happens to call
itself "The Illuminati", I apologize if some people will mix up the
The Illuminati I am
exposing here is the super-rich Power Elite with an ambition to
create negativity and a slave society!
The possible REAL Agenda, to
some degree unknown to even the super-rich families like the
Rothschild's is described in the article, "Dialogue
with 'Hidden Hand', Self-Proclaimed Illuminati Insider". But
before reading that article, I suggest you study this subject on a
more basic level first. The "Hidden Hand" article is pretty advanced
and can not be understood by people who have no concept of the
Illuminati and the New World Order.
term "New World Order", just like the term "Illuminati", has been
used by at least two different groups, meaning basically two
1) A goal to change the current Order ("The Old World Order"),
which is considered evil and anti-survival, and therefore the current
power elite I call the Illuminati (see definition above) needs to be
overthrown and their Old World Order to be destroyed and
replaced by a benevolent "New World Order". The goal is a
humanity-friendly One World Government. The means to overthrow the
current Old World Order is by violence, if necessary. The reason I
don't support this group is that I don't believe in their tactics. I
2) A goal to reduce the world population to 500 million
people in order to create a micro-chipped total enslaved society and
a One World Government, run like a world dictatorship. This is the
New World Order the Bush's, the Rockefellers, the Rothschilds,
Gordon Brown, Henry Kissinger, Zbigniew Brzezinski and others are
ringing in and have almost accomplished. This is the New World Order
I am fighting against via this website.
Penre is a researcher,
journalist, the owner of the
and is the publisher of the
same. He has been
and the New World Order and
exposed the big players
behind the scenes for more
than a decade now. He has
published his research on
the Internet at the above
domains, which are currently
updated to keep people
informed what is going on.
You can also find his
articles linked up,
discussed and republished
all over the Internet.
addition, he has done
to present a solution to the
problems of this world. His
MySpace website address is:
You can also visit his blog
and make comments at
Visit Our Sponsor's Website:
This page from illuminati-news.com may contain copyrighted material, the use of which has
not always been specifically authorized by the copyright owner.
I am making such material available in my efforts to advance
understanding of environmental, political, human rights,
economic, democracy, scientific, and social justice issues, etc.
I believe this constitutes a 'fair use' of any such copyrighted
material as provided for in section 107 of the US Copyright Law.
In accordance with Title 17 U.S.C. Section 107, the material on
this site is distributed without profit to those who have
expressed a prior interest in receiving the included information
for research and educational purposes.
Design downloaded from
Free web design, web templates, web layouts, and website resources!