Schwarzenegger Orders 200,000 State Workers be Paid Minimum Wage, State Controller John Chiang Refuses to Comply

Inquiring minds note that California governor Arnold Schwarzenegger orders minimum wage for state workers

Gov. Arnold Schwarzenegger on Thursday ordered about 200,000 state workers to be paid the federal minimum wage this month because the state Legislature has not passed a budget, but the state controller is refusing to comply.

Department of Personnel Administration Director Debbie Endsley sent the order in a letter to the state controller, who refused a similar order two years ago. The matter is tied up in the appellate courts, leading the controller to say he will abide by whatever final ruling emerges, which could be years down the road. He said he can't follow the order now due to technical and legal issues.

The Republican governor has been frustrated by the Legislature's failure to close California's $19 billion budget deficit, even as the new fiscal year began Thursday.

Schwarzenegger's order does not affect the 37,000 workers, including California Highway Patrol officers, who are in unions that recently negotiated new contracts with the administration. Those contracts included pay cuts and pension reforms that will save the state money.

Asked whether the governor was sending a message to the unions that have not yet signed new contracts, McLear said no.

"We're sending a message to the controller to follow the law," he said.

Schwarzenegger made a similar order two years ago, but it never took affect because state Controller John Chiang refused to comply. The courts later sided with Schwarzenegger, but the matter is on appeal.

"It's inevitable that this is going to end up being ruled against the controller," McLear said.

Chiang, a Democrat, is an elected statewide officer. His deputy press secretary, Jacob Roper, said Thursday that the controller's office does not intend to follow Schwarzenegger's order, in part because the state's computerized payroll system cannot handle the change.

"This is uncharted waters here," Roper said. "No city, county or state has ever taken this action before."

I have as simple solution to Comptroller Chiang's dilemma: Schwarzenegger should fire 200,000 state workers, doing the state of California a far better service than merely reducing union wages.

My proposal is nothing but a fair compromise for what Chiang says cannot be done. Otherwise I commend the governor for going into uncharted waters, taking actions that "No city, county or state has ever taken before."

The only thing unions understand is hardball so I say "let's play hardball". Moreover, It's the correct thing to do given that Firing Public Union Workers Actually Creates Jobs.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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