By MIKE ZAPLER

Gov. Arnold Schwarzenegger has been warning for months that California’s budget is hurtling toward the proverbial cliff — the point where the state cannot pay its bills.That time is about to arrive, and the fallout could be severe and far-reaching, particularly if the legislative budget stalemate lasts.

In February, state Controller John Chiang will suspend $3.7 billion in payments for at least 30 days. Further, IOUs in lieu of payments could be issued soon.

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