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By KEVIN O'LEARY / LOS ANGELES Kevin O'leary / Los Angeles – Sat Jun 27, 4:55 pm ET
The financial crisis in California grew worse this week as State Controller John Chiang warned that if legislators and Governor Arnold Schwarzenegger fail to come up with a budget-balancing package, he would begin paying California's bills with IOUs on July 2. The last time the state did this was during the Great Depression.
What has brought California to such a perilous state? How did its government become so wildly dysfunctional? One obvious cause is the deep recession that has caused tax revenues to plunge for all states. But California's woes have a set of deeper reasons: direct democracy run amok, timid governors, partisan gridlock and a flawed constitution all contribute to budget chaos and people in pain. And at the root of California's misery lies Proposition 13, the antitax measure that ignited the Reagan Revolution and the conservative era. In Washington, the Reagan-Bush era is over. But in California, the conservative legacy lives on.
California's Fiscal Crisis: The Legacy of Proposition 13 - Yahoo! News
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