Quote:
The Obama administration is threatening to rescind billions of dollars in federal stimulus money if Gov. Arnold Schwarzenegger and state lawmakers do not restore wage cuts to unionized home healthcare workers approved in February as part of the budget.
Schwarzenegger's office was advised this week by federal health officials that the wage reduction, which will save California $74 million, violates provisions of the American Recovery and Reinvestment Act. Failure to revoke the scheduled wage cut before it takes effect July 1 could cost California $6.8 billion in stimulus money, according to state officials.
The news comes as state lawmakers are already facing a severe cash crisis, with the state at risk of running out of money in July.
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http://www.latimes.com/news/local/la...,4592200.story
So now the stimulus money is being used as a cudgel to force states into doing what the Federal government dictates, and a state like California that is swimming in debt can't even regulate themselves without being threatened with further financial problems.
Wondered why it's taking so long to get the stimulus money out? Now you know why. Money = Power.
This also explains why several of the Republican governors have refused stimulus money.