From Volume 3, Issue Number 52 of EIR Online, Published Dec. 28, 2004

ARROGANT SCHWARZENEGGER PREPARING MURDEROUS CUTS
by Harley Schlanger

LOS ANGELES, Dec. 21 (EIRNS)—It did not take long for the wheels to fall off the souped-up Hummer known as the Schwarzenegger Administration in California.

Despite an aggressive propaganda machine which would make Joseph Goebbels green with envy, and a still-star-struck public unable to see the frightening reality beneath the Hollywood glitter, the budget reports released this week prove that Lyndon LaRouche has been right, again: As he warned, the state is careening toward bankruptcy, and George Shultz's golem, Arnold Schwarzenegger, is now preparing budget cuts which will kill Californians.

The latest report from the nonpartisan legislative financial office indicates that the budget deficit for fiscal year 2005-06 has shot up from the previous estimate of $6.7 billion, to at least $8.1 billion. Further, the total debt owed by the state has ballooned from $33 billion when Schwarzenegger took office, a little more than one year ago, to $51 billion, a whopping 55% increase. The percentage of the budget that goes to debt payment has increased from 3.4% in the last year of Democratic Governor Gray Davis's Administration, to 6.4% after Arnie's first year. By 2009, it is conservatively estimated that this will grow to 7.5%.

While Schwarzenegger apologists point their fingers at Davis, to blame him for the growing debt, they are hoping the voters have forgotten that the debt skyrocketed due to the effects of electricity deregulation—a larcenous policy which transferred wealth from energy consumers and the state, into the pockets of those pals of George Shultz who put Schwarzenegger into office, by recalling Gov. Davis.

Now that the rapidly expanding debt is coming due, who will pay? - Massive Cuts Are Coming -

On Dec. 17, the new Director of Finance, Tom Campbell, acknowledged that the two main areas which will be targetted for cuts are, first, health and human services, which will hit the poor, elderly, and disabled the hardest; and second, capital improvements, including road projects, school construction, water and other infrastructure.

The appointment of Campbell, once considered a moderate Republican who served in the state legislature and the U.S. Congress, was initially welcomed by many Democrats, who were relieved that Donna Arduin had left. Arduin, who had worked previously for Gov. Jeb Bush, and was known for her brutal approach to the budget—she once cancelled a program set up by private donors in Florida, which provided free eye tests and glasses to pre-kindergarteners, because it cost the state a few million—left after failing to find the promised "billions of dollars" in excess spending she and Schwarzenegger expected to find in the California budget.

After less than a month, however, Campbell has made clear he is preparing to impose murderous cuts. He is looking to slash Medi-Cal, which provides health care to approximately 6.5 million low-income Californians. This would exacerbate an already dangerous shortage of hospitals, especially emergency rooms and trauma care, as cuts imposed so far have already created a crisis in Los Angeles County. Top health-care officials in Los Angeles have warned that any further reduction in emergency rooms risks collapsing the trauma care system.

Pulling funds out of necessary transportation and water projects, and educational construction will worsen an already declining system. In the last several years, over $4 billion in state gas tax funds earmarked for transportation projects has been diverted to close the budget deficit. The water management program, CalFed, has been underfunded, while water is being diverted from highly efficient agriculture in the Imperial Valley to San Diego.

As for education, the number of students enrolled in the state university system has declined, while tuition has been increasing at a rate of more than 6% per year. Those unable to afford the prestigious state schools have seen massive cuts in community colleges, and a drying-up of financial aid. It appears likely that Schwarzenegger will renege on an agreement he made with teachers, who accepted a $2-billion cut this year in return for a pledge for more funds next year. Campbell told the press this pledge may not be kept. - Fascism with a Botox Face -

The selection of Schwarzenegger by George Shultz was prompted by former Gov. Pete Wilson's assurance that, in Arnie, they might have a candidate "with the stomach" to impose the austerity required to allow the looting of this once-productive state to continue. The launching by Shultz and friends of the "Schwarzenegger Project" is quite transparent, if one understands who Shultz is and how desperate are the bankers with whom he is allied, for a quick infusion of cash (see article, p. 6). The Enron-led looting of California, which drained more than $70 billion from the state, was just Phase I.

The gloomy fiscal reports released this week give Schwarzenegger the opportunity to prove to his creators that he is up to the task, that he is prepared to run roughshod over the people of California.

His callous disregard for those his policies harm was on display earlier this month when he taunted nurses at the Governor's Conference on Woman and Families. Nurses were in attendance to protest his order placing a three-year delay on reducing the nurse-patient ratio from one nurse to every six patients, to 1:5. In response to their signs demanding that he keep his promise, the arrogant actor flashed a botox sneer and mocked them.

"Pay no attention to the voices over there," he growled. "They are the special interests.... The special interests don't like me in Sacramento because I am always kicking their butts."

The Conference was funded by British Petroleum, Allstate, Citigroup and Bank of America—but, in Arnie's world, oil companies, insurance companies, and banks are not "special interests."

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