The play comes in several acts. This not the final act. We have to go through small and /or temporary cuts in the most visible and painful segments of CA govt spending.
After that builds some public sympathy for relief for CA, the feds will relent. “We had to save poor flesh and blood Californians from this horrible and unfair fate. They are practically dying for want of a few tens of billions of dollars.” A few of the most high profile spending cuts will be left in place, as a sop to federal taxpayers.
It is possible that a condition of receiving federal funds will be an increase in California taxes. There are many who would like nothing better than to see the end of Prop 13, and this bailout would be one of the best chances in years to achieve that. A good number of Republican pols and businessmen could be turned by the bailout money.
Give it another few months. The bailout is on its way.
