Schwarzenegger Wants $8 Billion Bailout from Washington

The desperate demand for dollars expresses itself in many ways. Shane Goldmacher and Evan Halper report for LaTi:

Facing a budget deficit of more than $20 billion, Gov. Arnold Schwarzenegger is expected to call for deep reductions in already suffering local mass transit programs, renew his push to expand oil drilling off the Santa Barbara coast and appeal to Washington for billions of dollars in federal help, according to state officials and lobbyists familiar with the plan.

If Washington does not provide roughly $8 billion in new aid for the state, the governor threatens to severely cut back -- if not eliminate -- CalWORKS, the state's main welfare program; the In-Home Health Care Services program for the disabled and elderly poor, and two tax breaks for large corporations recently approved by the Legislature, the officials said.

Schwarzenegger also will propose extending a cut in the state payroll that is scheduled to expire this summer. That cut has translated into 200,000 state workers being furloughed three days a month, the equivalent of a 14% pay cut. Lawmakers would have the option of extending the furloughs, imposing layoffs or some combination of the two.

The governor is scheduled to unveil his plan publicly early next month...One new source of revenue in the budget: Schwarzenegger will revive a plan to allow offshore oil drilling from an existing platform off the Santa Barbara coast. The proposal was so controversial during last summer's budget debate that after the Assembly voted down the plan, members expunged the vote, erasing it from the public record.

California's budget deficit has grown so large -- roughly 20% of the general fund -- that some measure of cuts to social service programs may be inevitable regardless of how Washington responds.