Where's my bailout?  How many of us asked this question of our friends and neighbors?  This is a relevant question because a federal bailout is the answer to California's budget crisis.  A federal bailout (scratch that - make it "rescue plan") is necessary because our state is too big to fail.  A California Rescue and Assistance Plan ("CRAP") can be paid for without raising taxes.  Such a rescue plan will benefit the nation as a whole by combating deflation.  Further, California is entitled to a rescue plan out of fundamental fairness.  Californians must demand the CRAP that we richly deserve.

The CRAP is the answer to California's budget crisis.  Now is not the time to point fingers and bicker over who is to blame or whether taxes are too low or spending too high.  We have plenty of time to fix blame later.  What we need now is a solution.  California taxpayers already pay a disproportionate share of state and federal taxes.  It is time for the nation to answer California's call for help in our time of need (to be their brother's keeper, so to speak).  The answer is simple - an infusion of federal money to plug the state's budget gap.

The rescue plan is necessary because California is too big to fail.  Our state is the world's seventh largest economy.  The California economy employs far more people than the financial industry and the automakers combined.  The financial collapse of our state government could set off a catastrophic chain reaction in the economy, eliminating millions of jobs.  This is not a time to be constrained by antiquated ideas about balanced budgets, austerity, or common sense.

The CRAP can be paid for without raising taxes.  The rescue plan can be financed like other recent rescue plans, by having the Federal Reserve print additional billions of dollars, which will be paid to California to meet its budget needs.  A rescue plan of $25 billion or so would be a paltry sum compared to the trillions which the Fed has already printed in rescuing our troubled financial system.  The California rescue plan would be but a drop in the bucket.

The rescue plan will benefit the nation as a whole by combating deflation.  Some worry that the Fed is threatening runaway inflation by printing trillions of dollars out of thin air.  These doomsayers and extremist ideologues compare the Fed's recent monetary expansion to counterfeiting.  (They ignore the fact that counterfeiting is illegal, while the Fed's monetary expansion enjoys the full faith and credit of the United States.)  More importantly, the doomsayers ignore the grave specter posed by a deflationary spiral of lower prices.  Printing additional trillions of dollars will provide the inflationary jolt needed to ensure that consumers enjoy the benefit of rising prices.  And while the doomsayers may be right that inflation is an "invisible tax", that is exactly what we need - one nation indivisible, with taxation invisible.

California is entitled to a rescue plan out of fundamental fairness.  While the state of Texas currently enjoys a surplus, that surplus is a windfall from last year's high oil prices.  It is only fair that Texans shares those windfall profits with the people who paid for their price gouging.  If we can extend a hand to banks on Wall Street, we can extend a hand to states who are struggling.

Californians must demand the CRAP that we richly deserve.  State Treasurer Bill Lockyer has warned that state financing of infrastructure projects will stop without a budget solution - highway projects, school construction and other vital work in communities across California. President-elect Obama has promised to jolt the economy with a Bigger Better New Deal that pays for infrastructure projects like these.  These projects are "shovel ready", and the incoming Obama administration should shovel billions of newly printed dollars our way.