California's Day of Reckoning: May 19

The bottomless pit is the taxpayer. He is called on to fork over the money. But he is now using a knife rather than a fork. In California, voters have knives. They will use them on May 19.

The Federal Reserve System is the bottomless pit during recessions. It will soon face a new source of demand: state governments that cannot balance their budgets or sell their bonds.

If the Federal government bails out California's government in order to overcome a veto by voters, then voters can forget about reigning in state governments. They can veto spending, but they will wind up paying for Federal bailouts of busted state governments.

If Congress does not hold the line in this issue, the precedent will be set in concrete. Governors from now on will say: "You bailed out Arnold. Why not bail out me?"

California has gotten in financial difficulty by spending more than it can collect from its overtaxed citizenry. The voters in California must vote for proposed tax increases or California will have to cut spending. Of course, cutting spending is not an option the politicians are willing to consider so they will appeal to Congress for a bailout to override the taxpayers callous disregard of the state's plight. If Congress does bailout California, the voters will pay through the nose anyway.