Calif. Could Go Bust by July

California dumps responsibility onto county, city

(NEWSER) - The good news for California is that its state prison system has a lot fewer prisoners and parolees to deal with. The bad news, according to the mayor and police chief of Los Angeles, is that crime on the streets is going to rise. The state last weekend shifted responsibility for thousands of parolees and inmates onto local jurisdictions, in part to cut costs and in part to comply with a Supreme Court order to improve prison overcrowding, reports the Wall Street Journal . More»

But female inmates who don't have kids are out of luck

(NEWSER) - Thousands of mothers currently doing time will head home soon as California rushes to shrink prison populations . Moms with 2 years or less left to serve for “non-serious, non-sexual” crimes—possibly half of the state’s 9,500 female prisoners—may be released within days; once home, they’ll wear GPS ankle bracelets as they complete their sentences, the Los Angeles Times reports. It’s “a step in breaking the intergenerational cycle of incarceration,” says a prisons official. “Family involvement is one of the biggest indicators of an inmate's rehabilitation.” More»

(NEWSER) - Major banks in California, including Bank of America and Wells Fargo, will stop honoring the state's IOUs after today, reports the Los Angeles Times. While some credit unions may cash the promissory notes, taxpayers and vendors who need cash may be tempted to sell them on the cheap to third-party speculators eying the tax-free 3.75% interest they bear. To rein in speculation, the SEC has ruled that IOUs are securities under federal law, and therefore can only be traded by registered dealers. More»

(NEWSER) - California’s finances are so dire that the state controller says he’s going to have to start doling out IOUs to creditors soon, reports the Los Angeles Times. Likening the situation to the Great Depression, John Chiang says he’ll have to issue IOUs to social-service agencies, private contractors, vendors, and others starting July 2 unless Gov. Schwarzenegger and state lawmakers close a $24 billion deficit. More»

Judges say squeeze threatens inmate health

(NEWSER) - A panel of federal judges ruled yesterday that overcrowding in California's 33 prisons—158,00 inmates in space meant for 84,000—poses a threat to inmate health. The court tentatively required the state to reduce the prison population by up to 57,000, the LA Times reports. The governor’s corrections secretary says the ruling “poses a significant threat to public safety.” More»