These just keep pouring in.  Here’s Sen. Gil Cedillo’s take over the flip.

“The Governor continues to talk around the central breaking point of the budget negotiation process – he has failed to find the Republican votes for a two-thirds budget deal. By rejecting the Democratic proposal – which was a fair solution that balanced difficult cuts with additional revenue – he has created this stalemate.

We can not ask students, the sick and disabled, or the elderly to bear the brunt of this budget crisis. We should not have to choose between highways and clean air or a balanced budget. Californians are clear on their support and expectations for education, transportation, the environment, and the social safety net that protects those most vulnerable.

The best budget solution will reduce the $41 billion deficit while doing the least damage.  Do the Republicans not receive phone calls from parents, students, or the elderly distraught over the possibility that an education or social service benefit, which is a life-line for them, will be lost? Where is the common ground in a scenario that puts the most vulnerable at risk?

Democrats are committed to working with the Governor and Republicans to fix the budget shortfall.  We have shown a willingness to make the difficult decisions necessary to solve this problem and remain ready to do so again.”

The Governor’s profound failure to lead in this time of crisis will be his legacy.

California’s working families are facing a crisis of epic proportions. We were hoping the Governor would use his State of the State to show us the light at the end of the tunnel — a sensible, fair proposal to balance the budget that would put people back to work and move our economy forward. We deserved much better than we heard today. Instead of embracing real solutions to lift California out of this economic morass, the Governor used his State of the State address to point fingers and peddle more empty promises.

The Governor’s repeated slash-and-burn tactics to balance the budget have left working families much worse off than we were five years ago.

Schwarzenegger’s response to the current budget crisis is so weak that he can’t even gain support from his own party, much less build consensus, bi-partisan support as true leaders do. That lack of leadership comes at severe cost to working families. Our state’s credit rating is tanking, thousands of jobs to rebuild our crumbling infrastructure are threatened and working people’s long-term economic security is in danger.

With working families facing sharply rising unemployment, mass layoffs and stagnating wages, it’s imperative that we stop the bleeding now. California should take a page out of President-elect Obama’s playbook and stimulate the economy by creating, not eliminating, jobs.  We also must take immediate steps to shore up our unemployment system and stem the tide of rising home foreclosures.

These are the real policies of change – plans that will put Californians back to work and get our economy going again.

Dave Johnson, Speak Out California

“People are asking if California is governable.”  Governor Schwarzenegger said in the State of the State address today that California faces insolvency within weeks.  He said there is more gridlock in Sacramento than on our roads, if that is possible.

The governor gave a very short speech, saying there is no sense talking about education or infrastructure or water or anything else as long as we have this huge $42 billion deficit.

But the fact remains that the state’s requirement that 2/3 budget-approval requirement means that the state is, in effect, ungovernable.   A few anti-government extremists are able to continue to block the budget, refusing to compromise or even negotiate, demanding that the state lay off tens of thousands of workers, slash medical help for the elderly, slash police protection and firefighting capability, slash funding for courts, raise class sizes to 40 or 50 students, stop repairing roads and levees and everything else the state government does.

David Greenwald writes at California Progress Report wrote, in State of the People is Grim: More Budget Cuts Are Exactly the Wrong Prescription,

“Budget cuts totaling $16 billion over the last three years have already had severe consequences for the people of California. And the Governor’s proposed 09-10 budget would further harm California families and our economy with an additional $17 billion in cuts to schools, health care, homecare, and state services.”

Leading up to the speech, David Dayen at Calitics wrote, in The State Of The State Is, Well, You Know, “Typically he has done this speech to coincide with the evening news.  This year he’s trying to hide it.”

We at Speak Out California want to invite readers to come up with some solutions for the budget mess.  We are working on some ideas for a prize for the best ideas.

Click through to Speak Out California.

Thanks to Shane Goldmacher at SacBee for getting this out. Check it out over the flip.

Lt. Governor Garamendi, Chief Justice George, President pro Tem Steinberg, Speaker Bass, Senate Republican Leader Cogdill, Assembly Republican Leader Villines, Members of the legislature, ladies and gentlemen, we meet in times of great hope for our nation.

Although we hear the drumbeat of news about bailouts, bankruptcies and Ponzi schemes, the nation with great anticipation is also awaiting the inauguration of a new president.

Our nation should be proud of what President-elect Obama’s election says to the world about American openness and renewal.

President Reagan used to tell about the letter he got from a man who said that you can go to live in Turkey, but you can’t become a Turk. You can go to live in Japan, but you cannot become Japanese. And he went through other countries.

“But,” the man said, “anyone from any corner of the world can come to America and become an American.”

And now, we know that any American child, no matter what corner of the world his father or mother comes from, can even become President of the United States.

What a wonderful national story for us.

This nation rightfully feels the hope of change.

Californians, of course, desire change here in their own state as well.

Yet they have doubts if that is possible.

For months, in the face of a crisis, we have been unable to reach agreement on the largest budget deficit in our history.

We are in our third special session and we’ve declared a fiscal emergency – and every day that goes by, makes the budget problem that much harder to solve.

As a result of all this, California, the eighth largest economy in the world, faces insolvency within weeks.

The legislature is currently in the midst of serious and good faith negotiations to resolve the crisis, negotiations that are being conducted in the knowledge we have no alternative but to find agreement.

The importance of the negotiation’s success goes far beyond the economic and human impact.

People are asking if California is governable.

They wonder about the need for a constitutional convention.

They don’t understand how we could have let political dysfunction paralyze our state for so long.

In recent years, they have seen more gridlock in Sacramento than on our roads, if such a thing is possible.

I will not give the traditional State of the State address today, because the reality is that our state is incapacitated until we resolve the budget crisis.

The truth is that California is in a state of emergency.

Addressing this emergency is the first and greatest thing we must do for the people.

The 42 billion dollar deficit is a rock upon our chest and we cannot breathe until we get it off.

It doesn’t make any sense to talk about education, infrastructure, water, health care reform and all these things when we have this huge budget deficit.

I will talk about my vision for all of these things… and more… as soon as we get the budget done.

So, no, I did not come today to deliver the normal list of accomplishments and proposals.

I came to encourage this body to continue the hard work you are doing behind closed doors.

There is a context and a history to the negotiations that are underway.

It is not that California is ungovernable. It’s that for too long we have been split by ideology.

Conan’s sword could not have cleaved our political system in two as cleanly as our own political parties have done.

Over time, ours has become a system where rigid ideology has been rewarded and pragmatic compromise has been punished.

And where has this led?

I think you would agree that in recent years California’s legislature has been engaged in civil war.

Meanwhile, the needs of the people became secondary.

Our citizens do not believe that we in government are in touch with their needs.

These needs are not unreasonable.

At the end of the day, most people do not require a great deal from their government.

They expect the fundamentals.

They want to live in safety.

They want a good education for their children.

They want jobs.

They want to breathe clean air.

They want water when they turn on the faucet and electricity when they turn on the switch.

And they want these things delivered efficiently and economically.

One of the reasonable expectations the public has of government is that it will produce a sound and balanced budget.

That is what the legislative leaders are struggling to do right now.

There is no course left open to us but this: to work together, to sacrifice together, to think of the common good – not our individual good.

No one wants to take money from our gang-fighting programs or from Medi-Cal or from education.

No one wants to pay more in taxes or fees.

But each of us has to give up something because our country is in an economic crisis and our state simply doesn’t have the money.

In December, we even had to suspend funding that affects 2,000 infrastructure projects that were already underway.

So, now, the bulldozers are silent. The nail guns are still. The cement trucks are parked. This disruption has stopped work on levees, schools, roads, everything.

It has thrown thousands and thousands of people out of work at a time when our unemployment rate is rising.

How could we let something like that happen?

I know that everyone in this room wants to hear again the sound of construction.

No one wants unemployment checks replacing paychecks.

So, I am encouraged that meaningful negotiations are underway. And, as difficult as the budget will be, good things can come out of it.

Because, in spite of the budget crisis, when we have worked together in the past, we have passed measures that moved this state – and even the nation – forward.

When a budget agreement is reached, when some of the raw emotions have passed, I will send to the legislature the package of legislative goals and proposals that a governor traditionally sends.

These proposals are sitting on my desk. Let me tell you, I have big plans.

They include action on the economy, on water, environment, education, health care reform, government efficiency and reform, job creation.

But, our first order of business is to solve the budget crisis.

And I have an idea going forward.

As you know, in the last 20 years of budgeting, only four budgets have been on time.

So, if you don’t mind, let me make a little suggestion.

We should make a commitment that legislators – and the governor, too – lose per diem expenses and our paychecks, for every day the budget goes past the constitutional deadline of June 15th.

You have to admit it is a brilliant idea.

I mean, if you call a taxi and the taxi doesn’t come, you don’t pay the driver.

If the people’s work is not getting done, the people’s representatives should not get paid either.

That is common sense in the real world.

And I will send you some other reforms, too.

Let me close by saying something about the fires of 2008.

At one point, I got a phone call that we had 875 wildfires burning all at the same time.

I said to myself, how do we deal with this?

The next morning I get a call, “Governor, there are now 2,014 fires burning all at the same time.”

The largest number on record.

Imagine, 2,000 fires, a huge challenge and every one of those fires was put out.

You know why? Because we have the best trained, the most selfless, the toughest firefighters in the nation.

Thirteen of whom lost their lives.

They gave their lives for this state.

Ladies and gentlemen, the courageous examples of those firefighters should not be lost on us.

In our own way, we, too, must show courage in serving the public.

Ladies and gentlemen, let this be a year of political courage.

Let us be courageous for the people.

Let us be courageous for the common good of California.

Let us resolve the budget crisis, so that we can get on with the people’s work.

Thank you.

(KQED here in the Bay Area will be airing live coverage at 10, as well as an hour of “pre-game” coverage on their Forum program at 9.  You can listen live here.  The California Channel will be covering it live as well. – promoted by Brian Leubitz)

Arnold Schwarzenegger delivers the State of the State Address at 10am this morning.  Typically he has done this speech to coincide with the evening news.  This year he’s trying to hide it.

I don’t blame him.  As David Greenwald discusses, people pretty much know the State of the State already.

As Governor Schwarzenegger prepares to report on the State of the State tomorrow, California’s families today declared that “the State of the People” is increasingly grim with a record number of Californians having lost their jobs and health care and their homes. California educators, students, health care workers, seniors and people with disabilities said more state budget cuts are exactly the wrong prescription after they’ve suffered the consequences of more than $16 billion in state budget cuts to critical services over the last 3 years.

“California families are here to report what you won’t hear from the Governor tomorrow: budget cuts over the last three years have deeply wounded our families’ health and well-being, diminished our children’s opportunity for the future, and damaged our economy.” said Evan LeVang, Director, Independent Living Resource Center of Northern California.

Californians who have personally been affected by budget cuts detailed the severe consequences that the cuts, including $10 billion in cuts already this year, have had on California families who have already been hit hard by the nation’s economic meltdown.

“Before our elected leaders slash another dollar from our hospitals, they should think about what health care would be worth to them if their husband, their daughter, or their father needed care. Because every patient that comes to our hospital is someone’s parent, spouse, or child,” said Beverly Griffith, an environmental services worker and SEIU member at Summit Medical Center in Oakland. “While longer hours and staff shortages caused by budget cuts have been rough on hospital workers, they’ve been unbearable for our patients.”

And of course, this is bound to get worse.  It’s important to split the two major problems into their discrete parts – we have a budget crisis AND a cash crisis.  Even if the budget hole is at least partially filled (and with any luck, we’ll be able to access some federal stimulus money, either through direct payments or tax revenues on increased economic activity, by February), the cash crisis would persist, and we could see IOUs even after a budget deal because of the inability for California to go to the bond markets and borrow.  And the converse is also true.  In sum, it’s a different problem which needs a different solution.  The LAO is obscure here, but I believe “restricted funds” refers to Prop. 98 money:

The Legislature’s budget analyst, Mac Taylor, says that schools, colleges and bondholders will have first call on the state’s money if its cash flow crisis hits home in a few weeks.

But Taylor says in a report on the looming cash flow crisis that even if the Legislature fails to reach agreement on closing the state’s budget deficit, the cash crisis could be relieved with some emergency legislation to allow more internal borrowing of restricted funds.

Gov. Arnold Schwarzenegger and legislative leaders have been conducting closed-door negotiations this week on both the budget and the cash crisis, which are related but separate issues. Controller John Chiang has said that the state will be forced to curtail state disbursements sometime in February unless there’s rapid action on the budget and/or cash flow-related legislation […]

The administration has asked the Legislature to approve measures that would free up about $2 billion in restricted funds that could be borrowed by the state general fund and thus stave off the cash crunch. It’s also said that rapid action on the budget would allow the state to defer more than $1 billion in payments to schools that otherwise would have to be made.

As a budget solution would at least have some impact on loosening the bond markets, this could be the intent of Schwarzenegger’s delay – so he can raid dedicated funds for schools and health care.  It’s important for us to start figuring out Arnold’s gambit.  When I talked to State Senator Fran Pavley at one of the election meetings last weekend, she said “It’s hard to negotiate with someone if you don’t know what they want.”  My next several posts here will seek to figure that out.

Anyway, you’re not going to hear it at 10am, I gather.

Gov. Schwarzenegger gives his State of the Disaster Area State at 10 AM, and I’ll be listening and/or watching.  On the listening front, KQED here in the Bay Area will be airing live coverage, as well as an hour of “pre-game” coverage on their Forum program.  You can listen live here.  Also, I imagine the California Channel will be covering it live as well.  However, the details of their coverage isn’t yet on their website.  That’s also available in some cable packages.

What exactly will Arnold say? Who knows?  I mean, what can he say that he or Mike Genest haven’t said already?  This is a horrific disaster, and Arnold and the GOP are playing shock doctrine. What’s left to say? What’s one more round in the cage match at this point to him? Well, we shall see at 10.