Orange County Register

Gov. Arnold Schwarzenegger (if he’s anything he’s persistent) has spent a quarter million dollars on radio ads to sweet-talk folks into buying California bonds. Gee, why does that sound on the face of it like a bad idea?

Could it be because the state is constantly reshuffling the deck to disguise the fact it’s got billions of dollars more in bills than it has in the bank? Or maybe it’s the fact that credit markets are locked up so tight even credit-worthy borrowers can’t get loans, let alone a spendthrift collection of politicians who never saw a dollar they didn’t spend?

The Sacramento Bee reports that California needs to borrow money (from bond buyers) for the tenth time in the past 11 years in order to pay its bills “until it receives the bulk of tax returns in the spring.” What possibly could have been going on that year they didn’t have to borrow to pay their bills? But we digress.

We suspect - as we’re sure the governor suspects - there will be less bulk in that bulk of tax returns come spring, thanks to the struggling economy. Retailers, from whom the state extracts sales taxes, are reporting terribly low volume as consumers are fearful of parting with their money not nearly as certain as they once were that the dollar they spend will be replaced by a dollar they earn, from which incidentally the state extracts income taxes.

It doesn’t strike us that “investing” in California government is a particularly wise thing to do. The mattress seems at least more reliable, and who knows, probably a better return too before Arnold and company are done with us.

But if you have $5,000 (the minimum chunk of change to get you a piece of these state bonds), go ahead. Maybe the governor will float some more bonds later to pay off these when they come due.

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