Public Affairs / Politics

New Schwarzenegger Budget for California Would Divert Gas Taxes
Gov. Arnold Schwarzenegger attempted to forge a path out of the state's financial mess Wednesday by offering concessions to both Democrats, who are demanding that schools and other services not be cut, and Republicans disdainful of new taxes. Both sides immediately declared that they wanted little to do with the governor's budget proposal, suggesting that Sacramento is in for another long, unproductive summer. Los Angeles Times

Tough Budget Decision Shifted to Voters
Now he wants voters to expand the California Lottery and borrow against future profits to help plug a $15.2 billion hole in the state budget. He proposed Wednesday giving them a choice that critics considered more of a veiled threat: approve his lottery plan in November or face a one-cent sales tax increase. Sacramento Bee

John Edwards Finally Makes His Choice: Barack Obama
Barack Obama advanced his drive to unite the Democratic Party behind his candidacy for president Wednesday by winning the long-sought endorsement of vanquished rival John Edwards at a boisterous rally. The announcement was a blow to Hillary Rodham Clinton, whose bid for the Democratic nomination appears all but lost, and brought Obama a welcome distraction from his landslide defeat Tuesday in the West Virginia primary. Los Angeles Times

Human Resources / Health & Safety

Democrats Want Chemical in Plastic Investigated
Congress on Wednesday waded into an escalating scientific dispute over a controversial ingredient in plastic products that some think may harm the development of children's brains and interfere with human reproduction. Members of a Senate consumer affairs subcommittee faulted federal agencies for reacting too slowly to concerns that children are exposed to bisphenol A, or BPA, through leaching from such items as water bottles, baby bottles and the linings of food and baby formula cans. Los Angeles Times

Budget Crisis in California
The budget would cut $1.04 billion from health and human services that were proposed in January's budget for a total reduction of $3.4 billion. Under a $1.1 billion cut to Medi-Cal - which serves 6.6 million people in the state -- tens of thousands of poor residents would receive fewer medical services. San Francisco Chronicle

L.A. City Council Gives Preliminary Approval to Fines for Patient Dumping
Hospitals that discharge homeless patients on the streets of Los Angeles without their consent could be charged with misdemeanors and fined up to $25,000 under a proposed ordinance that received preliminary approval Wednesday from the City Council.  The measure is intended to curb dumping, the practice of taking patients from a hospital by taxi or ambulance and leaving them on skid row downtown. Under the new law, a health facility would not be allowed to transport a patient to a location other than his or her residence without written consent. Los Angeles Times

Economy

Americans' Money Worries are Growing, L.A. Times/Bloomberg Poll Finds
Across the country, Americans struggling with rising food and energy costs are more worried about their personal finances than at any time since the early 1990s, according to the latest Los Angeles Times/Bloomberg poll. Nearly 2 out of 5 people say the state of their personal finances is fairly shaky or very shaky, the poll found. Los Angeles Times

Bernanke Urges Banks to Raise Capital if Needed
Financial market turmoil underscores the need for "generous" capital cushions, and banks need to actively raise money as needed, U.S. Federal Reserve Chairman Ben Bernanke said Thursday. Bernanke said regulators were also pushing for better disclosure by banks to increase transparency and to strengthen market discipline, and blamed lax risk management practices at financial firms for contributing to credit turmoil. New York Times

Inflation Pressures Ease Despite Food Price Jump
Consumer prices slowed in April despite the biggest jump in food costs in nearly two decades. But with oil near record levels, Americans should brace for more pain at the pump in the months ahead. The Labor Department reported Wednesday that consumer prices edged up 0.2 percent last month, slightly lower than expected and better than the 0.3 percent rise in March. Associated Press in the San Diego Union-Tribune

Environment / Agriculture

House Passes Farm Bill by Veto-Proof Margin
House Speaker Nancy Pelosi marshaled a 318-vote, veto-proof majority to pass a $290 billion farm bill that will lock in the nation's food policy for five years while granting $3 billion in first-ever money to support California fruits and vegetables. The bill, expected to pass the Senate today, also by a veto-proof margin, includes as much as $40 billion in subsidies to commodity farmers who already enjoy record prices. San Francisco Chronicle

Polar Bear is Added to the Endangered Species List
The Interior Department on Wednesday designated the polar bear as threatened with extinction because of shrinking sea ice, making it the first creature added to the endangered species list primarily because of global warming. The designation under the Endangered Species Act requires the agency to identify critical habitat to be protected and to form a strategy to assist the bear population's recovery. Los Angeles Times

Plumas Forest Projects Halted
In a resounding repudiation of the Bush administration's national forest management, a three-judge federal panel has ordered a halt to three major logging projects in the Plumas National Forest. Logging had been set to begin June 1 but now cannot go forward until an environmental impact assessment conforms to a Clinton administration forest management plan, the panel of the 9th U.S. Circuit Court of Appeals said. Sacramento Bee

The Air Resources Board is working on a regulation that could affect more than 1.5 million diesel trucks and buses in California! Join the Driving Toward a Cleaner California Coalition today and find out what you can do to make sure CARB strikes the right balance between protecting our environment and our economy. For more information on what you can do, visit www.drivecleanCA.org.

International

Swiss Survey: US Maintains Edge in Competitiveness
The United States topped world competitiveness rankings for the 15th straight year, but its economy is showing the same signs of weakness that sank booming Japan in the early 1990s, according to an annual survey released Thursday. The U.S. position was cemented by its domestic economy, which is the world's strongest, topping all others in its amount of investments, stock purchases and commercial service exports.  Associated Press

I.R.S. Seeks Reports of Foreign Accounts
In its hunt for wealthy Americans who have stashed money overseas to evade taxes, the federal government has turned to an obscure law enacted nearly four decades ago. Under the law, originally aimed at rooting out laundering of drug money, citizens or residents of the United States must tell the Internal Revenue Service each year if they have any foreign bank or financial accounts holding a total of $10,000 or more. Income from the assets is taxed at ordinary rates of up 35 percent. New York Times

US Commerce Secretary Woos China Investment
Commerce Secretary Carlos Gutierrez warned Thursday that rising economic nationalism in both China and the United States threatens to jeopardize beneficial ties. Foreign companies complain that Beijing is improperly favoring Chinese companies in an effort to develop national champions, while Gutierrez said China's swollen trade surplus with the United States -- $256 billion last year -- could fuel American protectionist sentiment. Associated Press in BusinessWeek

Infrastructure / Education

UC, CSU Move to Hike Tuition Amid Protests
California's 670,000 public university students got a double-barreled blast of bad news Wednesday when the governing boards for both the UC and the California State University systems took steps to raise tuition - for the sixth time in seven years. In Los Angeles, where the UC Board of Regents was meeting on the UCLA campus, 16 students were arrested for unruly behavior after a regents committee voted to impose a 7.4 percent tuition increase for the next school year. San Francisco Chronicle

Transportation Budget Will Hit Public Transit
The governor's plan calls for spending $13.8 billion on transportation next fiscal year - a decrease of less than 1 percent from his January budget. But the latest plan would take $1.4 billion from gasoline and diesel fuel sales tax revenue that ordinarily would go to public transportation and put it in the general fund. San Francisco Chronicle

L.A. Prepares Massive Water-Conservation Plan
With vital and often-distant water sources shrinking, Los Angeles officials today will revive a controversial proposal to recycle wastewater as part of a plan to curb usage and move the city toward greater water independence. The aggressive, multiyear proposal could do much to catch the city up to other Southern California communities that have launched advanced recycling programs. Los Angeles Times

Opinion / Editorial

Schwarzenegger's Budget Shows Lessons Learned
Schwarzenegger conceded he had concluded that the state's budget deficit -- projected at $15.2 billion, even without a reserve -- could not be erased "by cuts alone." He has become convinced, the governor told reporters, that there is a need for both spending cuts and higher revenue. George Skelton in the Los Angeles Times

Schwarzenegger Gives Up Trying to Balance Budget
Gov. Arnold Schwarzenegger has now abandoned his goal of fixing the problem that led to his historic election in 2003. With the revised budget proposal he released Wednesday, the governor has effectively conceded that California's era of perpetual budget deficits will not end on his watch. Daniel Weintraub in the Sacramento Bee

Budget has Many Plusses -- and a Big Minus
The revised 2008-09 state budget released yesterday by Gov. Arnold Schwarzenegger has a lot to like, a big idea that seems promising but needs more study, and a downright bad proposal that deserves oblivion.  Thankfully, the plan feels much more serious than the version released in January, which had such intentionally provocative elements as requiring the release of 22,000 prisoners and the mass closures of state parks. It is tough on spending, but with fewer extremes. San Diego Union-Tribune


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