I got a phone call from a friend in California.  Apparently California is in a budget crisis and state lawmakers are refusing to ratify a budget.  Okay so what does this mean? 

Well she and her fellow workers were informed that they would be getting paid minimum wage from 8/1/08, until the budget was ratified.  They would get their backpay when the budget was passed but until then the state would minimally function. 

Also the state controller John Chiang is refusing to implement the emergency minimum wage order of the Governor Arnold Schwarzenegger.  And the Governor is calling for layoffs as well to help balance the budget.  This budget crisis lets me wonder what are we going to do as a nation as the US government sinks further and further in debt?  If it’s this bad in CA is worried about a $15.2 billion dollar deficit we’re at $500B according my post about Drunken Wall Street. So should we be worried?  Is this just a preview of what’s to come?  I think it is. 

So I chatted a bit with my friend and she says PISSED.  She’s not as badly off as most people being single and financially savvy.  She has a 6 month EF and lives frugally.  But she’ll have to tap her savings to survive because her paycheck if paid minimum wage will be $700 for August and rent alone is $1500/month! 

She tells me that everyone she works with is panicking about money.  So many people support families and live paycheck to paycheck.  They have no idea how to survive with less money.  Ouch.  Unfortunately many people were not saving for a rainy day especially since they considered their state jobs “untouchable.”

It appears that job security like pensions are falling quickly by the wayside.  That no one in any job is safe.  That the only thing you can do is be ready to find another job at anytime. Even being self-employed isn’ the answer.  Why?  You are at the mercy of your customers, who if the economy is doing poorly and they can’t afford your services, then where will you get your business?

I guess the lesson learned is we all have to “budget” in some way.  And we all better be ready to find new jobs, even if it seems “guaranteed.”  Also my follow-up post to this which I’ve had brewing for a bit talks about the proposed increase in CA state income taxes.