Judgment Day: Broke California Faces Shutdown At Arnie Schwarzenegger ’s Hands

[ShedDweller]

Someone pointed out that Hollywood should bring in a Bob or two .. Sadly it doesn't really .. the money is raised in the international markets passes through the suits in LA and goes out to productions shooting in Canada, Argentina, South Africa or the UK. It's just too expensive to shoot in Hollywood, Union rates are too high and whatever tax breaks are offered to producers it's never enough (and of course it means that when a production HAS to shoot in LA the state gets very little cut) then the film is released and the money goes through an offshore tax haven ..

In contrast to the past where there was a huge industry in LA there are now Suits and not much else .. the really wealthy suits are offshore anyway .. so the tax revenue comes from lower paid suits ..

There is not alot in it for the state government ..

[Jason]

SPOILER ALERT - HIGHLIGHT TO READ

In the cells towards the end - he attacks John Connor when John is searching for Reece. He's the big terminator that John fires his little grenade launcher at

Was it him though, I thought he looked to young to be him, I didn't stay to watch the credits.

No, it wasn't actually Arnie... It was a CGI image of him.

Still a good film though.

[Guest anorthosite]

No, it wasn't actually Arnie... It was a CGI image of him.

Still a good film though.

Far too young & buff to be him - I thought I recognised some of the shots from the first Terminator film, I assume they just "copied & pasted" it in.

[aa3]

Someone pointed out that Hollywood should bring in a Bob or two .. Sadly it doesn't really .. the money is raised in the international markets passes through the suits in LA and goes out to productions shooting in Canada, Argentina, South Africa or the UK. It's just too expensive to shoot in Hollywood, Union rates are too high and whatever tax breaks are offered to producers it's never enough (and of course it means that when a production HAS to shoot in LA the state gets very little cut) then the film is released and the money goes through an offshore tax haven ..

In contrast to the past where there was a huge industry in LA there are now Suits and not much else .. the really wealthy suits are offshore anyway .. so the tax revenue comes from lower paid suits ..

There is not alot in it for the state government ..

Good post.. compare it to a steel factory and a coal plant in my argument. Hard to move those out of state. Well it can be done but then they have to build an entire new plant and gradually pay off the capital of it. Over time the rail link and sea port to move the steel out also get paid off. So competitive advantage can build.

Basically imo an industry like films is a nice addition to an economy, but not a base to an economy, the way that heavy industry is.

[athe]

Far too young & buff to be him - I thought I recognised some of the shots from the first Terminator film, I assume they just "copied & pasted" it in.

I believe they did - read an article about it a couple of months ago.

[tomwatkins]

I'm not sure I agree with the 'at Schwarzenegger's hands' part of the headline. He's been trying to reduce CA state spendng for years but has been consistently blocked by the Democrat majority in the State Senate. Granted his diplomatic skills leave something to be desired, but in all fairness the man was trying to prevent this moment from happening.

You are joking right? It's only Arnie's diplomatic skills that have achieved anything at all. He is liked by both sides and as I have lived there for a pretty long time (and still have an office there) I think I am pretty qualified to say this. Big Arnie is making the best of some shocking previous mis-management.

[tomwatkins]

Don't forget that the greens have the same sort of thought train as the high tax brigade. The greens are going to save the world by reduceing someone else's standard of liveing while the high tax brigade always advocate high taxes fore someone else.

eee bah gum mate you really like your "ee's" in the wrong places.

[bogbrush]

I believe they did - read an article about it a couple of months ago.

That makes sense, as they fried him into just a robot as soon as they could.

It was a surprise though, nice to see that they shoehorned him into the film.

[bogbrush]

You are joking right? It's only Arnie's diplomatic skills that have achieved anything at all. He is liked by both sides and as I have lived there for a pretty long time (and still have an office there) I think I am pretty qualified to say this. Big Arnie is making the best of some shocking previous mis-management.

Glad to hear it as I hoped his direct nature would be successful in a crisis. How does the population of California see it - do they blame him for it (as per normal for the public) or can they see beyond the short term?

[MOP]

Computer says no.

Calif. Aid Request Spurned By U.S.

Washington Post Staff Writers

Tuesday, June 16, 2009

The Obama administration has turned back pleas for emergency aid from one of the biggest remaining threats to the economy -- the state of California.

Top state officials have gone hat in hand to the administration, armed with dire warnings of a fast-approaching "fiscal meltdown" caused by a budget shortfall. Concern has grown inside the White House in recent weeks as California's fiscal condition has worsened, leading to high-level administration meetings. But federal officials are worried that a bailout of California would set off a cascade of demands from other states.

With an economy larger than Canada's or Brazil's, the state is too big to fail, California officials urge.

"This matters for the U.S., not just for California," said U.S. Rep. Zoe Lofgren, who chairs the state's Democratic congressional delegation. "I can't speak for the president, but when you've got the 8th biggest economy in the world sitting as one of your 50 states, it's hard to see how the country recovers if that state does not."

The administration is worried that California will enact massive cuts to close its deficit, estimated at $24 billion for the fiscal year that begins July 1, aggravating the state's recession and further dragging down the national economy...................

http://www.washingtonpost.com/wp-dyn/conte...9061503249.html

[Stars]

But I thought you didn't like taxes. It's ridiculously low taxation that's California's problem.

More specifically, California went 'all around the houses' to inflict taxes on absolutely anyone at all other than those people who were actually themselves receiving the public value (the owners of real estate).

[MOP]

Schwarzenegger puts case for IOUs

By Matthew Garrahan in Los Angeles

Published: July 2 2009 19:41 | Last updated: July 2 2009 21:35

Arnold Schwarzenegger has made a personal overture to the heads of America’s largest banks to persuade them to accept the IOUs being issued by California in lieu of cash.

With a budget deficit of more than $24bn, California has started its new financial year deep in the red and has been forced to issue the IOUs because it has run out of money.

Mr Schwarzenegger has spoken with the heads of several banks. So far, Bank of America and Wells Fargo have confirmed they will accept the IOUs.

A spokesman for Mr Schwarzenegger said the governor had assured the banks that the IOUs were “rock solidâ€.

“California has never defaulted [on its debts] before and we’re not going to start now,†he told the Financial Times.

The state has been buffeted by the recession and the property collapse, while an over-reliance on income taxes and capital gains taxes paid by high-earners has put additional pressure on the state’s coffers.

It will issue IOUs until the state comes up with a budget that addresses its deficit. However, there were no signs on Thursday that an agreement would be struck between Mr Schwarzenegger and the members of the California assembly.

John Chiang, the state controller, said the IOUs were inevitable because of the stalemate. “I have no option but to issue IOUs...to businesses, students receiving financial aid, taxpayers expecting refunds, and local governments in order to meet our obligations to schools and our bondholders,†he said.

The state has asked its public employees to take three unpaid days of holiday each month to preserve funds. Meanwhile, Mr Schwarzenegger has spent the past few days locked in talks with the members of the state legislature.

Sharp divisions have emerged, with Republican members and Mr Schwarzenegger clashing with Democrats over potential spending cuts and tax raising proposals.

The fiscal crisis has revealed other divisions in the state. Voters in the big cities and coastal areas of California are mainly liberal and are generally in favour of paying higher taxes to reduce the budget deficit.

But the inland areas and Orange County in southern California are predominantly conservative and likely to side with Republican proposals that would cut public services.

Copyright The Financial Times Limited 2009

http://www.ft.com/cms/s/0/3bfe0a24-6737-11...144feabdc0.html

[wren]

Paper fiat currency is only IOUs anyway.

So they are IOU IOUs.

[Ash4781]

Hercules in New York

Edited July 3, 2009 by Ash4781

[john_coller]

Its ironic that the state that contains Hollywood which makes billions worldwide has run out of tax funds.

In addition doesn't California produce a lot of other things like wine, oranges, etc.

Hollywood doesn't pay taxes. If California straightened out their accounting system they would get the money they need.

http://en.wikipedia.org/wiki/Hollywood_accounting

[copydude]

If California straightened out their accounting system they would get the money they need.

No, but they might get another loan they have even less chance of paying pack.

Even the IOU scheme is, as they say in the US, 'just kickin' the can down the road'.

Sigh.

, I think.

[porca misèria]

That's a pretty serious sounding state of affairs, laying off police, closing prisons and schools. If they were a country i bet they'd have tried QE, still, a year down the line and it'd be Zimbabwe. Now i wonder how we'll be fairing in a year or 2s time....

Yep, they're part of a bigger currency.

Like Ireland - except the Irish had an austerity budget to pull back from the likelihood of catastrophic failure.

Unlike Iceland or UK. Or various other countries from Argentina to Russia to Zimbabwe in the not-so-distant past.