Easy for them to say, I suppose, but Mike Honda and a bunch of California Congressional Dems want the stimulus money to go to education.  At least they’ve noticed that a ridiculous number of teachers are being laid off. All the while, President Obama is cheering on the Governator who is gobbling up every last dollar and slashing services.  Perhaps they can talk to the President about not enabling Herr Schwarzenegger.

Here’s the money quote:

   The purpose of the State Fiscal Stabilization Fund is to help stabilize local government budgets and minimize or avoid harmful cuts to education programs and services, to keep teachers in the classroom, and to support modernization, renovation, and repair of school facilities. It is imperative that local educational agencies receive stimulus funds as soon as possible so they can appropriately adjust their budgets to address these challenges.

   Thousands of California teachers will be laid off in coming weeks without the infusion of ARRA funds. We implore you to provide for the immediate needs of the state’s already cash-strapped schools by taking all available steps to prevent these layoffs. It has been brought to our attention that there may be unresolved issues at the state level about the administration and allocation of the federal ARRA funds that could delay distribution. We encourage you to address these issues quickly. The U.S. Department of Education stands ready to provide technical assistance to you in these matters.

You can catch the full letter here (PDF).

California’s unemployment rate now stands at 10.5%, the highest since the Reagan-Volcker recession of 1982-83, which itself was the highest since the 1930s.

Of course, this rate is based on the federal U-3 rate, which many observers consider to be a not exactly accurate picture, since it excludes involuntary part-time workers and those who have given up actively seeking work. One analyst argues that if you try and reckon the CA numbers based on the broader U-6 measure (which does include those kind of workers) California’s true unemployment rate is nearly 20%.

In some counties even under the current EDD reckoning unemployment is already above 20%, in mostly agricultural counties where unemployment is at Steinbeckian levels – 26.6% in Colusa, 24.5% in Imperial, 16.2% here in Monterey.

And yet the Yacht Party continues to argue that we don’t need the federal unemployment stimulus, and Obama’s new BFF Arnold Schwarzenegger is content to soak up the media adulation for not acting like Mark Sanford despite not having actually provided leadership to break GOP opposition in the Legislature and sending mixed signals from his own staffers.

The recent stock market rally dead cat bounce has led some to believe that the worst may be behind us. But as 26,000 teachers get ready to be officially fired and as unemployment benefits remain too little for too brief a period, it seems clear that the abyss still has no bottom.

Listen to Arnold Schwarzenegger’s budding bromance with President Barack Obama:

“When have you ever seen a president be that out there?”

That was a mesmerized Arnold Schwarzenegger after Obama’s town hall meeting.

“I’ve never seen that,” Schwarzenegger said to a couple reporters as he and his wife, Maria Shriver, tried to make an exit. “Usually people are so guarded. The aides are always so guarded. They’re so afraid that you will blow it or that you will make news that’s unintended and all those things.”

Schwarzenegger continued to gush about Obama.

“But I think he’s so smart,” he said. “He’s so clear with his thinking and he’s so well informed and has been dealing with policy in all this and is also very philosophic it’s almost like. I think he’s just like – I think it’s beautiful.”

Given his record, I can see why Arnold would be so enchanted by a politician who actually knows the issues he talks about.

He accompanied the President back to Washington today for talks on infrastructure.  Maybe someone in the White House will ask him why his staff is leaning toward rejecting stimulus money for extended unemployment benefits, and why he has given no public position.

We’ve mentioned California’s crashing bond rating several times over the last year or so.  That’s mostly because we keep getting downgraded. Well, yesterday was no different. We have now broke that tie with Louisiana, and we now stand alone with the worst credit rating amongst the 50 states:

Fitch Ratings downgraded California’s general-obligation bond rating Thursday due to concerns about the state’s economy and ongoing budget problems, likely raising costs for taxpayers and dampening demand for $4 billion in bonds the state intends to sell next week. California’s bond rating now ranks worst among the 50 states, according to Fitch.

The announcement came days before State Treasurer Bill Lockyer plans a bond sale starting next Wednesday to replenish the state’s Pooled Money Investment Account and enable California to begin paying out $500 million to projects that desperately need public funding to continue.

Fitch Ratings downgraded California’s general-obligation bond rating from A+ to A, which likely means the state will have to offer more attractive rates and could preclude some investors from purchasing the bonds, said Alex Anderson, portfolio manager of Los Angeles-based Envision Capital Management. Fitch had California on a negative ratings watch since early last year.(SacBee 3/20/09)

Well, there you go, there’s a few more millions out the window. Which program do you think will get the axe this time? Maybe we can just cut out the 12th grade entirely. I mean, we don’t really need Californians to know advanced math skills do we? Literature, Schmiterature.

With the bonds scheduled to go to market next week, the cost of this is going to be quite real, and will add substantially to the $8 Billion number being tossed around now. Unfortunately, the only real way to address the bond rating is to actually resolve the budget crisis, and apparently the bond agencies aren’t inclined to believe that the latest round of budget “solutions” has actually achieved a long-term solution.

I suppose their assessment is valid, but it’s sure a fine time for the rating agencies to start paying attention.  Too bad they weren’t this vigilant with the mortgage backed securities.