California’s Republican Governor Arnold Schwarzenegger dropped the other shoe July 31 — or rather, he threw it at state workers — when he signed an executive order cutting the pay of up to 200,000 of them to the federal minimum of $6.55/hour and firing over 10,000 part time and temporary workers until the state’s budget impasse is resolved.

“I understand that this will affect people at a time when they are already struggling and so I want to apologize to all the state employees for having to do that,” the governor said as he signed the order.

He had originally threatened to do so three days earlier, on July 28.

While the workers whose pay was cut will receive full back pay once a budget is signed, the laid-off temporary and part time workers don’t have a guarantee to get their jobs back. Workers deemed essential to public safety and health were exempted.

As the workers represented by SEIU Local 1000 and other public employee unions protested around the state, Controller John Chiang pledged again to defy the governor’s order. Chiang challenges both the governor’s claim of legal authority to order the cut, and his contention that the state is about to run out of funds. Chiang also warned the move will cause payroll problems for months after a budget is finalized.

“To the extent that the Order attempts to govern the constitutional duties for which I was independently elected to perform, and because it is based on faulty legal and factual premises, I will not comply with the Order,” Chiang said in a letter to the governor after the signing.

Local 1000, representing a large portion of the state workers, was preparing to file a lawsuit Aug. 1 challenging the firings, and an unfair labor practices complaint protesting the pay cuts.

State Senator Dean Florez (D-Shafter), head of the Governmental Organization Committee, challenged Schwarzenegger to explain himself at a hearing Aug. 4 “It’s not enough for the governor to simply drop his bombshell proposal on the hard working people who keep our state operating with no explanation,” Florez said in a statement. He called the order “a major public policy shift that will have a great potential of disrupting the entire state and our state’s economy.”

Meanwhile, the legislative stalemate over how to resolve a $15.2 billion shortfall in the $101 billion general fund continues for the fiscal year that started July 1. Democrats, a majority in both houses, want to combine cuts with higher tax brackets for the very rich and closing corporate loopholes. Republicans refuse to raise any taxes. California requires a two-thirds vote both to pass a budget and to raise taxes — a majority the Democrats can’t muster.

Late as it is, this year’s budget isn’t yet breaking any records. In the last two decades, five budgets have been later.