1 Monty did you read the WSJ yesterday? The state comptroller(i think that was the title) of New York wrote in to the letters to the editor section and claimed that their pension funds were 100% funded

2 OT : what the *&^% is a hipster?

3 The level of austerity and new taxation required to crawl out of the holes they've dug themselves would impoverish the citizenry and degrade their day-to-day life.<<<

You say that as though that were a bug rather than a feature. Let them associate the money that gets taken out of their paychecks with the ridiculous leftist policies that have led them to a degraded existence, and then let them go forth, to other untainted places, and sin no more.  How the hell else are the people going to associate cause and effect?

4

OT : what the *&^% is a hipster?

someone who both loves and doesn't understand the meaning of irony.

 

google hipster, click the images tab, and behold the pictures of hipsters

5 I want a bailout.  How do I get one?

6 2 OT : what the *&^% is a hipster?

Think of someone who uses Apple products, drives a Prius, hangs out at Starbucks, wears sweaters, and recycles everything.

7 google hipster, click the images tab, and behold the pictures of hipsters Or better yet, don't. The urge to hit the monitor is enormous.

8 hahahaha thanks for the input everyone ... I get it ...I get it ... I am not sure I can handle the images

9

On a serious note, here in Pittsburgh they've put off repaving some roads, and the only road work they are continuing with the is highway road work.

Police are also getting haircuts, but unfortunately the stupid people and local media are decrying the cuts.

To cite one example, a local police force retired a police dog because they couldn't afford it anymore. However all the local media stations ran puff pieces on the dog, replete with images of him looking cute, playing, etc etc. So at the next township meeting a ton of people turned out to protest it and the local media was there.

We're running out of money and the only way you can get people to show up to local township meetings is for a cute dog.

 

That said, I highly suggest you people go to your borough, township, municipality, etc meetings. Become involved on the local level. There are usually one or two a month and they are like 1-2 hours.

10 NY State pensions are 100% funded, no problem. The payouts are denominated in Monopoly dollars, of which NY has many trillions.

11 claimed that their pension funds were 100% funded Every state in the Union is gaming their pension numbers. CalPERS is the biggest offender, but they all do it -- they use actuarial "smoothing" to offset huge losses in a single year over a 5-year-period so it doesn't look so bad, and they assume ridiculous rates of return to justify not requiring higher contributions from the states (or employees themselves). Most pension funds I've seen assume returns somewhere in the region of 7 to 8 percent, when really the return is more likely to be in the 4 to 5 percent range -- which translates into a fiscal hole of huge proportions. The problem is that states don't have to account for their liabilities in the same way that corporations and individuals do. If states had to account for "present value" of their investments to drive their contributions, they'd be screwed even more than they are now. (In fact, about half the states would be declared insolvent immediately, as would a hundreds -- maybe thousands -- of towns and cities.) The whole world is waking up to the fact that defined-benefit pensions and "for life" entitlements (especially health care) are a rocket-sled ride to insolvency.

12 Remember when Ace posted that Youtube vid of Cornell students taking over their cafeteria because they were upset at the school's decision to [insert grievance here]?  They "took over" the cafeteria for a couple of hours by barricading the doors and they filmed the whole thing, while cops just stood perimeter to make sure no one got hurt. 

Corporate water?

All Apple products?

Anyone remember that?

13 Is total default an option?  A world wide "start over"?

14 So bankruptcy it needed?  I just don't trust the federal government to create it in a way that doesn't hand the proverbial keys over to the unions - a la G.M.

15 How about mortgage forgiveness?  Student loan forgiveness?

16 As you said, They need a mechanism to rescind the contracts and restructure their debts.  In theory (As Sovereign Powers)they can already do that, but Federal Courts have not allowed them to do contract restructuring.

The crown jewel of them all is to not allow public sector unions.  At All. Anywhere. No Teachers Unions. Nothing. Perhaps that means a Federal Right to Work Statute is a start. At some point we run into a Freedom of Association issue, but we can deal with that when we get there.

There's about to be an all out war here in Minnesota by the Teachers' Union (I hate it when they are referred to as the Education lobby).  Look what the Police Unions have done in California (there's a great City Journal article about it IIRC)

17 Last comment on this then back to serious stuff ... so a hipster is someone who tries so hard to be cool, they aren't cool. Got it.

18 O/T:  My dumb blond friend just announced that she will be attending a SOTU watching party and then the cool guy will connect his laptop to the tv and they will participate in the "after party" festivities from the campaign.  I asked if she was going to watch Paul Ryan's rebuttal she said "who?, what rebuttal?"....but her best remark was "do you think he will mention the economy?"

19 My city hired 6 new police officers a few years ago because they got grant money. All traffic cops. Services across the US are completely f*cked up because of the perverse incentives of overlapping or stupid Federal/State/Municipal grants and regulations. More traffic cops doesn't add in any significant way to the safety of my community, but they hire the cops anyway because it is so "cheap"--even though we are still paying for it through federal tax dollars. It is the same way with pensions for employees. It doesn't hurt any manager to ensure that retiring employees get as much overtime as possible, as the pain of such a decision is borne by the taxpayer. The result extra overtime might mean little to the manager, but it means (potentially) millions in additional pension liability. That extra few hours was certainly not worth millions to Joe Taxpayer.

20 How about mortgage forgiveness?  Student loan forgiveness?

Not, to be rude, curious, but are you going to support 'checking account forgiveness'?  Because if everybody's debts are waived, all the money everyone is owed disappears, too.

21 OT : what the *&^% is a hipster? Justin Timberlake is an example.

22 I like Cantor but this is nothing more than rhetoric. We are already bailing out the States with that BS bond buying program.

I'll believe him when he pushes through legislation to stop that program.

23 Indeed, Great Depression 2.0 as with Great Depression 1.0 is not an event but an economic condition that will drudge on for years and decades. People think the stock crash was the great depression, nope...it was the 16 years or so afterwards in which the US strangled its economy via bad policies. Policies which still hurt us today, in some cases.

24 Last comment on this then back to serious stuff ... so a hipster is someone who tries so hard to be cool, they aren't cool. Got it.

Posted by: wolverine at January 25, 2011 09:57 AM (GvYeG)

I thought that was a hipster doofus?

25 I am pretty amazed about how orgasmic the media is about this SOTU.

26

Remember when Ace posted that Youtube vid of Cornell students taking over their cafeteria because they were upset at the school's decision to [insert grievance here]?  They "took over" the cafeteria for a couple of hours by barricading the doors and they filmed the whole thing, while cops just stood perimeter to make sure no one got hurt. 

Corporate water?

All Apple products?

Anyone remember that?

It was NYU or Columbia, not Cornell. It was a new york school if rememeber correctly.

 

27 a hipster is someone who buys all their stuff from American Apparel, the salvation army and they buy ripped panty hose.  They support the creative community at Etsy and pay pal.  They live in Brooklyn and mom and dad subsidize their life style while they pretend to be poor.

28 joeindc44 has read The Forgotten Man

We are reliving this. Terrible.

29 Just how will residents refuse to pay taxes and fees? Quit their jobs? Abandon their homes or apartments?

30 29 Just how will residents refuse to pay taxes and fees?

Quit their jobs?

Abandon their homes or apartments?

Posted by: eman at January 25, 2011 10:03 AM (n0WLs)

If things get bad enough in your state you might just move to the closest state with less taxation.  Some will keep their jobs by working from home.

31 What Cantor is saying is states want a bankruptcy process so they have something (bankruptcy court, bankruptcy code) and someone (bankruptcy judge) to take the fall for all the unpopular decisions that have to be made. Cantor is right that state legislatures are perfectly capable of doing a similar workout of their debts legislatively, they are just unwilling to do so because everyone will be mad at them. Cantor is telling them to suck it up.

32 Just how will residents refuse to pay taxes and fees?

The same way they've had free mortgages for the last couple of years.  If everyone does it, it takes forever to process them all.

33 If things get bad enough in your state you might just move to the closest state with less taxation. Some will keep their jobs by working from home. Posted by: curious at January 25, 2011 10:04 AM (p302b) Neighboring States can't employ enough people fast enough. Working from home is not tax-free.

34

Boat owners frequently call their boats "a hole in the water into which I shovel money" but at least boat owners usually stop shoveling after the boat has sunk.

35 Who thought the giant sucking sound (of jobs) would be from Texas?

36 so a hipster is someone who tries so hard to be cool, they aren't cool "Hipster" has become a catch-all term that isn't terribly descriptive. (Sort of like "hippie", "beatnik", "goth", and any other youth-culture label you can think of.) Twentysomething urban kids who dress in "vintage" clothes, listen to obscure bands, and self-consciously cultivate an air of detachment and irony while at the same time professing themselves aware of the irony in a humorous way -- it's not so different than any other youth fad. (It's so strange to me that I think of someone in his early 20's as a "kid". My grandfather was married and had three kids by the time he was 25. I can't imagine thinking of him as a "kid" at that age. People stopped being "kids" at 15 or so back then.)

37 There are no more escape hatches. We have to stop running, turn around, and fight the beast.

38

I don't share Cantor's belief that states have the "requisite tools" to solve their fiscal problems, or at least not states like California, Illinois, New York, and New Jersey.

Enough pot-holes and garbage and they might decide that the schools are getting too much money, state regulations that hurt business and retail are a bad idea, funding education and health care for illegals doesn't work, etc.

My local school system can't FIND enough shit to spend money on. They are in a constant search for anything anything at all to buy. Everyone gets a laptop, every kid has a bicycle at school to ride around the track, all the schools have climbing walls, the high school was converted to green toilets, full day care centers next to planned parenthood in the middle and high schools. C'mon. But I can't use them because of the crime and drug rates and btw, the fact that it's a sanctuary city and therefore if you aren't an american, we don't even ask where you live--free free free stuff for everybody!!

39 If things get bad enough...you've read Grapes of Wrath? You've heard of the Potato Famine and the resulting exodus from Ireland to America?

40 Just how will residents refuse to pay taxes and fees? The same way they've had free mortgages for the last couple of years. If everyone does it, it takes forever to process them all. Posted by: Methos at January 25, 2011 10:07 AM (Ew1k4) Taxes are automatically withdrawn from your paycheck before you see a dime. The self-employed can refuse to make quarterly payments, but they are too few in number.

41 #19, The union toll collectors have been gaming the system forever. They make the newbies take sick time so the guys who are to retire in two years get the OT since their retirement pay is based on the last two years of wages. They retire like kings.

42 Isn't Chris Christie doing the "hard hard work" of pulling New Jersey off the top of the cliff?   I've heard jersey liberals praise him but the teachers don't like him very much, in fact they seem to despise him and include rude comments about his weight and his butt when describing him.  I love to point out to them that Christie is a big man, he's big boned, now Michael with the baseball cap, have you seen him, yeah, he's not just big boned"....it drives them totally nuts.

43 Just how will residents refuse to pay taxes and fees?

Here's a money-saving tip from Milwaukee's north side: Instead of paying the state $75 and the city $20 to renew your license plate, borrow a snips from someone's garage and cut the sticker off someone else's car. Voila!

44 Even worse is the situation in places like Bell, CA. They were using tax moneys to give themselves huge salaries but the residents were unaware in large part because the taxes were coming out of local businesses. This does not directly affect the local residents but can crush the local economy.

45

That said, I highly suggest you people go to your borough, township, municipality, etc meetings. Become involved on the local level. There are usually one or two a month and they are like 1-2 hours.

Posted by: Ben at January 25, 2011 09:52 AM (wuv1c)

At a recent conservative confab dealing with General Assembly issues, more than one old timer has told us that the legislators know right from wrong, but it's far easier to do wrong when no one shows up to watch the lawbreakers makers. 

Today, we're being urged to go to Richmond to stare down a dem state senator who won't let a 10th Amendment issue (repeal of any fed program the state deems onerous) come to a  vote.  The dingbat fails to think ahead to any Repub prez making a law she doesn't like.

On Friday, we're asked to attend sessions where the special interests are rooting (and contributing $$) for a new law that will force draconian zoning laws and slowly but surely get us to tiered levels for water and electricity and ultimately, rationing. 

 I don't think the Founders had this kind of shiite in mind at all.

46 Taxes are automatically withdrawn from your paycheck before you see a dime.

If you a) work and b) get paid on the books.

The image of drug dealers handing out W-2 and filling out I-9 forms for their mules and muscle is kinda fun, though.

47

The level of austerity and new taxation required to crawl out of the holes they've dug themselves would impoverish the citizenry and degrade their day-to-day life

Monty...I can't necessarily agree with that. California's problem is not necessarily a budget issue. They can address revenue shortfalls by cutting spending. They can cut off the entitlements to illegals and that alone would solve the budget deficit issue.

The problem is with pensions. The powers that were gave themselves and select constituent groups health and retirement benefits that were way out of line with the norm and based on ridiculous return on investment projections.

California has a population of about 38 million. There are about 1.5 million current and furture retirees in the system. Declaring bankruptcy and restructuring the pension and health plans would not necessarily put anyone into poverty.

Reducing outrageous benefits does not mean taking them away completely.

48 I'm getting the feeling that I can kiss my 401k goodbye.

49 I'm bitter here in MN that we lost the Gov race.We kicked major ass in Legislature and Senate. Gawd, we could have been New Texas. Now we have to deal with Governor Chicken Shit

50 Automatic withholding of taxes is a powerful tool that transforms citizens into serfs.

51 50 I'm getting the feeling that I can kiss my 401k goodbye. Posted by: RayJ at January 25, 2011 10:15 AM (2oRAd) Go with that feeling. They're already doing it in eastern Europe and it's just a matter of time before somebody finds a way to do it by regulation here, no legislation required.

52 It's so powerful and subversive eman, that Friedman went to his grave thinking it was his most mortal sin.

53 Corporate water? All Apple products? Anyone remember that? It was NYU or Columbia, not Cornell. It was a new york school if rememeber correctly. They were rioting over tuition being raised over Palestine students or something like that.. Something about Muslim student's tuition being raised... I'm 85% sure that's the reason.. It was bad enough they were ignorant douche bags but for an ignorant cause too.

54 The tax-base of a good-sized city can collapse with terrifying speed. Most cities and towns depend on one or two large employers to drive the local economy -- if those businesses fail or move, it can kill the town. People in towns like that don't stick around to find other jobs because there are no other jobs; they haul stakes and move (if they are young enough), or just "retire" and start collecting welfare. So not only are the taxes the business itself paid gone, but so are the taxes and other economic activity of the people who worked there. Restaurants lose business and close; grocery stores, shoe stores, movie theaters. If you want to be employed for your full lifetime, I think that people are going to have to accept the fact that you'll need to be able and willing to move -- and not just once, but several times. (I've lived in six different states since I graduated from college, and moved completely across the country three times.)

55 Welfare queens, professional felons, illegals, and the connected rich 'self proclaimed erudite' urban elite (the ones with really good accountants hiding the money) don't pay taxes. As this is a significant portion of the voting block for Democrats in the afflicted states, besides the public sector unions, none of those politicians will feel threatened at the ballot box. It's only when there is no more money to be confiscated, printed, borrowed, other otherwise materialized to run the rotten scheme that they'll wake up to the problem.

56

Does everybody else know this web site already?

Sunshine Review.

 State budgets, gov't salaries, etc.

57

I am really not for bankruptcey for the states. The persons in the end that are responsible for the state of the states are the voters and they are also the ones that recieve the services. Bankruptcey would be candy for them and let them continue to believe that you really can get something for nothing.

In Washington last November we voted down tax increases and passed yet another initiative to force a super majority for tax increases. The legislature now is doing what we forced them to do which is making huge cuts to balance the budget.

There is some whining about the cuts but not a lot. So far it seems to be working.

58 None understand austerity like the Humungus. With my strong leadership, I can grant your state safe passage through the wasteland. Vote for me and I may allow you some go-juice for your machine. Those who refuse will be strapped to my machine as hood ornaments. Vote for me and there will be an end to the horror. Just walk to the voting booth.

59 Posted by: Monty at January 25, 2011 10:23 AM (4Pleu)

Not only do the towns lose the employees paying taxes, but they also lose the property tax from the business that went down. The State also loses the corporate taxes as well.

But not to worry. We here in SC have gone hog wild with increases in sales tax in the past 10 to 20 years. When the economy goes to shit those drop even faster than the businesses.

I have come to the conclusion that governments exist to increase government and no other reason.

60

Monty, I'm tempted to agree with your basic proposition (bankrupty yes, bailouts no).  But rockhead makes an excellent point about whether bankruptcy administration by the Federal courts would be corrupt, as with the ripoff of GM and Chrysler bondholders by the unions. 

Will the benefits of an orderly bankruptcy administration offset the risk of a union-loving judge forcing muni bondholders to take a deep loss so that state & local gov't union workers and retirees get to keep receiving their bennies?  The wariness of muni bond buyers is the only protection against that, I guess.  Nobody should trust the rating agencies after 2008...

61 One aspect of city finances that many people don't think about (including the government of the town) is this: towns tend to age badly, at least in America. Here, as in so many other things, Detroit offers a fascinating and frightening example: in 1950, it was the avatar of the modern American city -- vibrant, growing, wealthy, technologically advanced. Not much more than two decades later it had turned into a national joke, which it has been ever since as it rots slowly away. But all the bills that Detroit ran up in the good days in terms of bond debt, pension obligations, and the like are still there and must be paid. Debt taken on by a city of nearly two million now has to be paid by a city with less than half that number -- citizens who are in almost every respect poorer and less well-provided-for than their parents were. But the bills must be paid, so the remaining sad sacks are squeezed, and squeezed, and squeezed. You can pick other cities in the great old industrial heartland to see what happens when we fail to accurately predict the future: Cleveland, Cincinnati, Akron, Milwaukee, etc. Los Angeles, San Diego, and San Francisco are looking down the barrel of this gun. Phoenix, Albuquerque, Denver, Dallas, Houston, on and on and on. The money problems are not magically going to disappear -- the cities and states have been pissing away money for decades on the back of the biggest bull market in history. But the party is over and the bill has been presented, and the number at the bottom is a pretty terrifying one.

62 I think Detroit, and possibly a few other large urban areas like it are not representative of all American cities in general.

They show what happens when the great society takes hold and turns the majority of your population into welfare mooching locusts and then the local government is taken over by the "redistribution I want mine society". The old city governments were rife with corruption but the ones in power since the 70s have taken it to a new level. The are blatant about it because they know they are very unlikely to ever be held accountable because they can play the race card.

Not all the major urban areas though have sunk to the levels of Detroit and New Orleans.

63 And speaking of Muni bonds: the outlook there is getting muddier as well. I think that muni bond investors are trying very hard to ignore the parlous state of municipal and state bonds, probably out of a sentimental attachment to an investment that has been up until now a very safe and predictable backwater of the finance world. But the horrible outlook for many states and municipalities is forcing investors to take a serious look at state finances, and they're not liking what they're seeing. I must repeat -- States and municipalities cannot issue currency, but they can issue debt, and they will continue to do so until bond markets force them to stop.

64 The loon who ran for governor down here had one thing right: If you have to pay property taxes, you don't own your property--you rent it from the government.

And that is why not paying your taxes is not an option.  They'll just take it.
"Come and get it." That was a real challenge but it was only made real by thousands being willing to hang together.

65 Screw that, I no more owe the states that spent themselves into insolvency that I do to support some bankrupt foreign country.

They spent THEIR money, they sure as hell aren't reaching into my back pocket to correct their mistakes.

66 I know blue state unions are an anecdote target rich environment for waste etc..  But in terms of fixing the now and getting things right for the future, I would really like to see some numbers like lets say California state employees took a 30% cut.  What would that do for the budget?  What if state employees over 100k per year took a pay freeze?

Federally Tea party caucus should start pressing for a pay freeze for fed employees who make over 100k yr.  Think about how that argument would play out!  That is a lose lose fight the left really really does not want to have out in the open.  I think we should be ramping it up right now before we state talking any cuts to medicare/social sec etc..

67

26 It was NYU or Columbia, not Cornell. It was a new york school if rememeber correctly.

It was NYU.  Protesting in solidarity with some leftist professional grievance group or other, and it had nothing to do with NYU.  Just dumb rich kids showing the rest of us how enlightened they are.

68 And that is why not paying your taxes is not an option.  They'll just take it.

That is one thing I have been harping on lately about the first great depression. Just as many people lost their homes and farms to property tax seizure as did to bank seizure but you never hear about that from the liberal media.

When Snidely Whiplash ties Nell to the railroad tracks he is always a bank guy and not the tax guy.

I figure if they ever get ready to take my house for taxes and I can not sell it, it will burn it to the ground and salt the earth. 

69 Legalities don't matter nor do the protestations of Republicans, who will fold like neat napkins once the Chicken Little talk of National Economic Collapse Eleventy drools from the MFM. Just like TARP, they will have to destroy the "free" market in order to save it. Look, there is that giant printing press in DC, run by that Bernanke guy in the printer's devil hat. One way or another, the states will get to that money. Perhaps Ben just prints some more, just like for TARP. That fresh funny money will go into someone's hands, and that money will eventually go to buy mountains of fresh debt issued by states like Clownifornia. It's inevitable. Look at Europe. Despite all the howling, more and more Euros just keep showing up, even though Greece is late on its latest payments. Legal mechanisms are created from thin air by men and they can be as easily transformed. Look at the Build America bonds. A bailout by another name. Anyway, people won't cease paying taxes. The gubmint can just go into your account and take it. Besides, most people never see their tax money thanks to withholding. The misery and debt will be shifted to other people through the usual methods of printing fiat money. The only question is whom will feel the hit the most. It's unlikely to be the public union pensioners since they own states like Clownifornia.

70

66 I must repeat -- States and municipalities cannot issue currency, but they can issue debt, and they will continue to do so until bond markets force them to stop.

But the municipalities & states themselves are addicted to debt because they don't have enough cash coming in to finance the promises they have made, both to the unions and to the pols who run everything.  Illinois is a prime (bad) example, the lame-duck legislature approved a huge 67% tax increase THE MORNING THE NEW LEGISLATURE WAS TO BE SWORN IN. 

What's worse is that even assuming the tax increase generates additional revenue (not a sure thing longterm as high income taxpayers & businesses vote with their feet), that huge tax increase doesn't even get the state back to zero.  It will still be deficit spending because not one single cut was made anywhere and the tax increase will not generate enough to cover existing promises.

The sellers of munis are spinning like crazy to keep the gravy train rolling, not unlike the sellers of "liar loan" mortgages a couple of years ago.  This is going to end badly.

71 If CA declared bankruptcy the judges would make sure that the union members would get a full re-instatement of their benefits while other areas were penalized. Look at the auto company bankruptcies. 

72 Wait! Fitch just upgraded our bond rating! All is well! I repeat: all is well!

73 Right on time, the French are floating the sort of ideas you would expect... Sarkozy is proposing a scheme to internationally regulate the trading of commodities, with limits on how much you can buy and how long you can hold them. Yay, price controls! Over at Mish's place. http://globaleconomicanalysis.blogspot.com/ Oh, and fuck Clownifornia.

74 In The First Tycoon there is a little paragraph about how after the panic of 1837 the states defaulted on their bonds.

75 Methinks many bond rating agencies will soon be awash in hookers and blow. Or alternatively, fish heads and anonymous death threats.

76 The level of austerity and new taxation required to crawl out of the holes they've dug themselves would impoverish the citizenry and degrade their day-to-day life.

I'm thinking such conditions are way too good for the socialist dimwads. To begin with a modicum of justice, pink underwear should be a requirement for all men outside of San Francisco.

77

Monty,

Explain to me why I should give a fat rat's rotund ass about the lowered quality of life in states who signed up for bankruptcy? Make your bed and lie in it, I say.

78 "I don't share Cantor's belief that states have the "requisite tools" to solve their fiscal problems, or at least not states like California, Illinois, New York, and New Jersey."

Then it seems to me that Cantor is still right, and we don't need a new federal bankruptcy statute. If states need to invoke internal measures like bankruptcy the impediment appears to be their own state laws and constitutions. Which can be changed, revoked, or amended by the state governor and legislatures. If they don't have the tools right now, then they have the power to make them.

And that's what state governments are for, damn it. They don't want to do their jobs now because it's hard, and because it'll make people angry at them. They'd prefer to give speeches before adoring crowds, spend other people's money, and create an unconstitutional system that lets them hand off their mess to the federal government. I'm sorry, I don't think we should let them do that.

79 Well, well, well -- who'd have seen this coming? Tax evasion on the uptick. Americans tend to be good civic participants and pay their taxes, but it wouldn't take much of a nudge to turn them into Greek-style tax evaders. Even noted fans of the social-welfare state can display surprising hypocrisy when faced with a large tax bill.

80 I'm tellin' y'all, the yawning maw of public pension retirees and public unions will be sated. Nature abhors a vacuum. Somehow, some way, freshly minted fiat money will find its way into their bellies until they are made whole. We may see future union workers get much lower wages, we may see current union workers have to kick in more from their future paychecks, but no one will touch the retirees golden lucre. The politics demand it. When have we ever seen large numbers of unionized workers get their retirement bennies shaved? Even after the GM theft they ended up owning a large chunk of the company. No, the debt will be spread abroad, in little wounds, small enough that people won't notice. Or, at least 52% of them.

81

MN is a decent example of the average State.  Next biennium forecast at $6.2 Billion shortfall.  MN has been relatively on top of pension funding.

Proposed fix anticipates 15% layoffs accross the board.  Defined contribution for all pensions.  Half billion dollar reduction in income tax/sales tax support of local education,  nearly that for state-run universities.

Not touched, counter-productive state regulation of commerce.

82 Americans tend to be good civic participants and pay their taxes, but it wouldn't take much of a nudge to turn them into Greek-style tax evaders Opa!

83 Explain to me why I should give a fat rat's rotund ass about the lowered quality of life in states who signed up for bankruptcy? Because California (for example) accounts for about 20% of the US GDP. If they go down the toilet, we go down right along with them. (California's economy is about the same size as that of Russia, FYI.) And I am old-fashioned enough to consider them fellow-citizens (however misguided and irritating they may be), and it pains me to see my fellow citizens in distress. I would rather that they do well than that they do badly, and I would rather they fiscally healthy than a fiscal basket-case -- for my own selfish reasons. I don't think anyone seriously thinks that damage from a major state bankruptcy would be limited only to that state. The ripple effects would be global. I can be angry that my liberal fellow-citizens have pissed away a lot of money, and continue to persist in habits that have led them to their current penury. I can be angry that their irresponsibility will cost me and many others a lot of money (in one way or another). I can wish them a certain amount of discomfort as just repayment for their stupidity. But I don't wish them ruination and complete failure...if for no other reason than that their failure is also mine, in a way. I guess it's like one of your kids wrecking your car: you want to thump the dumbass on his noggin for being so stupid, but at the same time you're thanking God that the thoughtless dumbass is safe at home. Nearly any mistake can be rectified with time, but dead is forever.

84 Proposed fix anticipates 15% layoffs accross the board. The result of unions refusing to get real, and it's fine. Rather than accept cuts in pay and keep everyone employed, many unions stick to their guns... and the states just lay off workers instead. Nice shootin' there, union guys. Yes, that was intentionally vitriolic rhetoric.

85 71 And that is why not paying your taxes is not an option.  They'll just take it.

Ever wonder why gold still keeps chugging away? And I am not talking about securitized gold, but the real stuff. Kind of hard for the National Socialists to know you own gold or guns unless you tell them.

86 There is no solution except collapse and rebirth. It is inevitable. Runaway trains don't give a shit about STOP signs.

87 " The level of austerity and new taxation required to crawl out of the holes they've dug themselves would impoverish the citizenry and degrade their day-to-day life."

Then let them be impoverished and have their day-to-day live degraded. They VOTED the politicians in that gave away the store, now they can live with it. Why do the rest of us have to take action for their intentional screwups?

88 I am old-fashioned enough to consider them fellow-citizens (however misguided and irritating they may be), and it pains me to see my fellow citizens in distress.

Are you a bleeding heart or just playing one on a blog?

89 The crown jewel of them all is to not allow public sector unions.  At All. Anywhere. No Teachers Unions. Nothing. Perhaps that means a Federal Right to Work Statute is a start. At some point we run into a Freedom of Association issue, but we can deal with that when we get there.

Quick! Someone email that to Jerry Brown.

90

Posted by: Monty at January 25, 2011 11:20 AM (4Pleu)

I am far les sympathetic to the self inflicted wounds of the idiotic leftard citizens than you are Monty. And as far as their ruination spreading, this country needs an enema. It may be that the only thing that will wake people up to their stupidity is severe pain and ruin. When you stick your head in a crocodile's mouth don't expect me to feel sorry for you when he bites it off. After all, they have the whole world to look at for examples. It's not like it sneaked up on them.

91 Nor is the answer a grinding decade-long period of stagnant growth and declining quality of life as the various cities and states slowly grind to a halt, their backs broken by pension and healthcare obligations.

That is the status quo of most of our major cities since at least the 60s.

Agree those states have no chance unless they go through something like a bankruptcy, but I think the cure may be as bad as the disease--life in a state where a bankruptcy judge is making all the financial decisions, tax and spend, is going to suck, big time, and those states are going to look like Detroit now looks--deserted, Mad Max type environments.

92 3You say that as though that were a bug rather than a feature. Let them associate the money that gets taken out of their paychecks with the ridiculous leftist policies that have led them to a degraded existence, and then let them go forth, to other untainted places, and sin no more.  How the hell else are the people going to associate cause and effect?

They will move, to your state.  The Q for those of us in solvent jurisdictions is, what are we going to do to protect ourselves from those who don't? Build a fence or ???

93

Is total default an option?  A world wide "start over"?

Sure.  But everybody with any brains will never invest in stocks and bonds ever again.  I sure wouldn't.

And borrowing money or using credit cards or any type of credit?  Kiss that idea goodbye.

94 I live in California.  Dear God I hope the feds never bail out this state.  Legal Bankruptcy is the way to go.  Shit can every contract, pension plan, and pay table in the state.  California counties and citys must follow suit.  The government feeding trough needs to be reorganized.  Public employee unions can cry a fucking river, and then go to hell.  We've had it up to our keesters with this insane horseshit.  Insurance plans where employees pay zero throughout their careers, and zero during retirement.  Pension plans that pay 100% or more at retirement.  We have government employees paid higher than their private sector counter-parts.  California is about to collapse, and the public empoloyees,  along with their unions are demanding that taxes must be hiked for all this shit.  A June ballot will ask taxpayers to fuck themselves again.  It aint gunna happen.

95 Are you a bleeding heart or just playing one on a blog? "We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America." I take this notion seriously. What else can I say?

96

Monty has a point -- but the main thing to remember is a lot of innocent people in those states, who are only a part of the problem thanks to where they live, not their lifestyles or their voting habits, are going to suffer, will probably suffer a lot worse than many.

Yeah, I'm kinda one of them -- certainly live among them -- so I know of what I speak.

 

97 31The question is what the answer will be for those states which are fiscally viable and do not want to be sucked into the fiscal abyss by the liberal states and the federal government.  For those states, an answer will exist (and only one answer) and that will be for them to leave and release themselves from the fiscal insanity around them.  Otherwise, no matter how responsibly they deal with their own budgets, they will still be sucked into the black hole by the other states and the feds.

Zackly. 

98

On Friday, we're asked to attend sessions where the special interests are rooting (and contributing $$) for a new law that will force draconian zoning laws and slowly but surely get us to tiered levels for water and electricity and ultimately, rationing. 

 I don't think the Founders had this kind of shiite in mind at all.

Posted by: RushBabe at January 25, 2011 10:13 AM (urYpw)

Ummm...if you need a place to stay when you become a refugee, I have a spare room. Just sayin', tho I will admit to living in the moonbat portion of north Florida so that may not sit well with you.

99 101 And acting overly reactionary and paranoid will definitely solve the problem, but of course.

100
Automatic withholding of taxes is a powerful tool that transforms citizens into serfs.

Yes. Also, it makes the take seem...unimportant. If you had to sit down and write a check every three months, then there would have been a sizable backlash against governments a long effin' time ago.

101

102 Where is this place?  Can you explain it a bit better, because that zoning law doesn't appear to pass the constitutional sniff test -- isn't there some way the citizens could vote it down or get it repealed?  Dear God!

 

Of course, all of this craziness does advance my plans to become a minor warlord of the wastelands...so there's that...

102 Bankruptcy is a horrible idea and would destroy the long-term bond ratings of participating states. It would be the coupe de grace for a large part of the public finance market that is already in gross disrepair.

I realize the counter argument is that state pensions, et al would be restructured. But measured against diminished investor confidence, driven by fears that bankruptcy would become an option some time again in the future, it would undermine a pillar of that bond market. It also places participating states at a gross disadvantage when measured against their peers.

Why invest in NY when you can invest in say- Texas? Please don't tell me rates. This isn't Greece and paying premiums just to issue debt launches a state back in the same direction of financial mismanagement.

If some of these governors searched far enough into their Constitutions they would realize there are other options to restructure pensions and benefits. But most of them don't have the stones to do it since that would undermine their base of supporters (Hi! NY and California.). Frankly, some are ultimately not going to have a choice. In the process neither will their blood sucking unions. Its not like they are going to support republicans any time soon. :-/

103 O/T:  I love this headline at the Daily Caller:  "The SOTU response: Obama to provide the pomp, Ryan to explain our circumstances"
moronettes, the paul ryan pic is very nice, very nice indeed...

104 curious: "If things get bad enough in your state you might just move to the closest state with less taxation..."

The state you leave will then be in worse shape since for most people, those who are able to move are generally "contributors" to the system which is to say "taxpayers." The most destitute will remain because they lack the assets to move. It's really a ratio of those able to contribute taxes to those consuming them that determines a particular state's potential to survive mass exodus. Plus, while the actual source of money may move, they may bring with them a "high tax, big gov" philosophy even though they themselves don't want to pay. Think Hollywood and other "do-gooders."

You cannot eliminate the collapse. Individuals can try to run from it, but the net effect cannot be avoided. The best solution is to contain the damage and force those who acquired the most debt (by their voting patterns) to suffer the consequences. People will respond to negative stimuli, and high taxes is one of the best of the ages when there's no bailout. Grasshoppers versus ants.

105

107 That is a pretty good headline.

106 And the unions and special interest groups are going to make damn sure that those governors and legislatures don't -- and everybody knows it.  What nobody can figure out is how to break the chain.

106 New bumper sticker:  Rescind EO 10988

107 Bankruptcy is a horrible idea and would destroy the long-term bond ratings of participating states. I've got some news for you -- the bond ratings are going to tank anyway. Muni investors are already nervous (hence the creeping interest rates), and all it will take is a little nudge to turn the current shuffle towards the exits into a stampede. There's a lot of magical thinking going on about how on earth a state like Illinois or California is going to repay their grotesque obligations -- not just "debt" (bonds and other warrants), but long-term entitlements and obligations (which are just as much "debt" as any other kind). You can't just hand-wave it away or insist that somehow magical pixies will come down and sprinkle fairy-dust on the situation and make it all better. There is a huge financial burden that has to be made good somehow -- in Callie, that burden might amount to about two-thirds of a trillion dollars, if you count all state and municipal obligations over the next decade or so. Illinois is almost as bad, and I'm betting that New Jersey and New York are within shouting distance. Bankruptcy is not just the best way to deal with this; it's the only realistic way.

108 Voluntary return to territorial status is the answer for states that were too irresponsible to control their spending. Upon a popular vote of its citizens, the state becomes a territory, the federal government covers its debts, the old state government is dissolved and the residents lose all federal voting privileges (i.e., clout in Washington).

Then the territory can be restructured from the ground up, and not by those who screwed the pooch in the first place. Of course, the restructuring can fail if it's done foolishly or dishonestly (true of everything), but there'll be many a gimlet eye turned on the process.

Reversion is nasty enough that nobody is going to say the state got away with anything, and no other state is going to be tempted to go that route if it can be avoided.

109 My local school system can't FIND enough shit to spend money on. They are in a constant search for anything anything at all to buy. Everyone gets a laptop, every kid has a bicycle at school to ride around the track, all the schools have climbing walls, the high school was converted to green toilets, full day care centers next to planned parenthood in the middle and high schools.

In Detroit (high school graduation rate of about 20%) they just spent a nice amount of $$$ on a high tech security command center in a brand spanking new building. Because the 7 students left in the city deserve the very, very best.

Also... if there is a way that the keys of the bankrupt city/ states can be handed over to the unions, Prez for Life Hussein will figure out how to do that. I mean, was what he did with the GM bond holders even remotely legal?

110 103--I don't think I can "solve the problem" of other people's addiction to government largesse. The problem is too big, and the addicted are too numerous. 

But I can take steps to protect my kids from the consequences? That's my focus. I don't want my kids raised in a society where their main function is to float a system to support others' crazy addiction to government programs. The idea of handing my kids that type of future is revolting.

111 "I don't share Cantor's belief that states have the "requisite tools" to solve their fiscal problems, or at least not states like California, Illinois, New York, and New Jersey. The level of austerity and new taxation required to crawl out of the holes they've dug themselves would impoverish the citizenry and degrade their day-to-day life."

Well here's a crazy assed idea.  Instead of raising taxes, reduce services.

112 Instead of raising taxes, reduce services. Not so great, because the cuts would basically return some cities to frontier-era outposts. In some municipalities, the level of spending on pensions and healthcare for retirees eats up about 50-60% of every dollar. And those bills are only getting more expensive. So what do you cut? Libraries, public works, sanitation, snow removal, and, yes, cops and firefighters at the end of it all. So what is a "city" at that point? Now, I'm a bigger fan of the free market than most, but this is taking rugged individualism to a rather absurd degree, I think. I like having a functional sewer system, and reliable electricity, and having police and fire services on call. My objection is not paying for those services, but rather that my taxes for those services are being siphoned away to pay for unsustainable personnel and administrative costs. "Sustainablility" is going to be the most important word in our vocabularies for a long time to come, I think. Take a look at Detroit and New Orleans and Baltimore and ask yourself if that's really the kind of place you want to live in, or raise your kids in.

113

108 Do you believe that all of the "contributors" are of conservative political ideology?  My experience tells me otherwise.  Similarly, do you think all "consumers" are that way from choice and are automatically leftist? Experience again informs me otherwise -- I've seen many families around here that have been put into the position of becoming "consumers"...they have voted red more and more often; similarly I have seen business owners et al. who still are not affected by the economic downturn to that extent -- "contributors" if you will -- who will vote their feelings (which may be quite leftist) because they can.  Still many conservatives seem to idolize them (because they are "contributors") while at times appearing to desire a pogrom of the "consumers" because they are poor I guess.

That's actually a great way to advance statist policies and propaganda imho.

As for keeping the infection of statist policies out of "clean" states -- I really don't think there's a solution to that other than voter vigilance.  You can't force the citizens of a state to stay in that state; unless you also want to abolish constitutional rights...which you'd be doing by supporting such ideas.

I realize it is very tempting because it's emotionally easy, but it is very much that: a temptation.  I would suggest not giving into it.  As an example: I don't feel a shred of pity for the city of Chicago -- but not everyone there is some welfare queen or hipster douche or union toadie; not everyone is a screaming leftie, and many did not vote that way.  It's very easy to give into ranting about it, and sometimes you should to blow off steam, but ranting does not make good policy or good ideas.

 

114 67 The loon who ran for governor down here had one thing right: If you have to pay property taxes, you don't own your property--you rent it from the government.

And that is why not paying your taxes is not an option.  They'll just take it.

They probably aren't keen to take it. Banks didn't suddenly stop foreclosures because they're nice guys: it's better to have a seriously overdue loan on the books than it is to have  property that you can't sell on the books.

Side note: are the banks continuing to pay the property taxes?

115 I'm wondering if we don't need a collapsed state. A state where it absolutely is ungovernable, where people flee for anyplace else. An entire state of Detroit. Let it collapse, and get so bad that it voluntarily petitions Congress to remove it as a state and make it a territory. Then we can bail it out and remake it.

116 Posted by: Monty at January 25, 2011 11:38 AM (4Pleu)

establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare

Imo, none of this goes hand in hand with giving a criminally spoiled brat everything he wants. It encourages the brat to stay a brat and majorly pisses off everyone else in the house. This is not justice, and I wouldn't let a child of mine suffer this type neglect.

117 As an example: I don't feel a shred of pity for the city of Chicago -- but not everyone there is some welfare queen or hipster douche or union toadie; not everyone is a screaming leftie, and many did not vote that way. Which is one of the reasons I advocate a revocation of universal suffrage. If I had the ability to mandate it, only people who actually pay net taxes would be able to vote. (Or if your net gain from the government's coffers was zero.) If you have no skin in the game, the temptation to keep voting yourself more "free" money is overwhelming. It sounds anti-democratic (and maybe it is), but it's also a much-needed check on electoral abuse. Too many people have a vested interest in keeping the status quo as it is because they benefit from it. It's in their rational self-interest to keep the gravy train rolling for as long as they can. (Which is why such a reform probably won't happen.)

118 unknown jane@117,

You are projecting an emotionalism I do not have. It's cold, hard facts at an almost macro level. I'm not assigning any philosophical bent to either contributors or consumers. Simply, there are those who have assets and there are those who do not. Those with assets have higher ability to retain mobility. They are the ones, as individuals, with the highest likelihood of taking their taxes with them to new climes.

My more specific slam was the coincidental movement of those with assets who will leave their tax-sucking domain and find a place to hide while bringing with them the same voting pattern that brought their old domain to its knees. That's not to say those "Hollywood" types are the only ones with such behavior. I would just add that it's all a matter of degree. There's a whole spectrum of emigrants bringing a range of "socialism" to their new lands.


"As for keeping the infection of statist policies out of 'clean' states -- I really don't think there's a solution to that other than voter vigilance..."

Obviously and agreed. The state will have to be "cordoned off," so to speak, from those with assets or else the behavior will never change. The idea of locking a state down from civilian movement is an absurd conclusion.

119 104
Automatic withholding of taxes is a powerful tool that transforms citizens into serfs.

Yes. Also, it makes the take seem...unimportant. If you had to sit down and write a check every three months, then there would have been a sizable backlash against governments a long effin' time ago.

Posted by: I R A Darth Aggie © at January 25, 2011 11:46 AM (1hM1d)

The first time I got a real paycheck with taxes taken out, I was pissed at the amounts I saw.  In fact, everytime I look at my paycheck, I'm still pissed.  Mostly at the SS and Medicare taxes, since those are the ones I really hate.

My relatives get all excited when they get tax refunds.  They don't seem to get that the money they get back is money taken from them in the first place.  They really seem to think it's free money from the government.

120 If I had the ability to mandate it, only people who actually pay net taxes would be able to vote. (Or if your net gain from the government's coffers was zero.) If you have no skin in the game, the temptation to keep voting yourself more "free" money is overwhelming.
Posted by: Monty at January 25, 2011 12:23 PM (4Pleu)

Which brings up the utterly desirable situation where the Dims try to rewrite the tax code so all their factions - that is to say, the urban poor - actually pay taxes, so they can continue to vote for their Dim masters.

I hate to say it, but an annual poll tax - pay 500 or a thousand dollars and you can vote in any elections held in that year year - makes more and more sense to me all the time. Make it the right amount, and the Dims won't be able to afford to finance a horde of "bought" voters, while actual productive citizens will be able to vote.

One other thing, make it a felony to pay the tax for anyone not a close family member - for example, son, father, brother.

121

You guys are all talking like these states and cities have lost their ability to tax. They haven't even begun to tax like they will need to and that's why the ratings agencies aren't feeding this fire.

What's in danger is the willingness of their voters to accept any tax increases. And more and more we see that taxpayers are losing patience with profligate legislatures and sweetheart contracts. So before we are approached with any "revenue enhancements", there's going to have to be a LOT of pain on the pension/benefit side.

My great fear is that some baby-splitting will be done too early on, success declared and when the real bill comes due, the unions will say they already gave at the office.

122 soulpile is... expendable@123,

Tax Freedom Day is April 13, 2011. If you include the deficit, it'll be May 29.

At a minimum, if you pay taxes, you work for well over 1/4th of the year to settle up with Uncle Sam. The rest you can use to purchase consumables at inflating prices.

Tell your relatives that. Every day, their first ~2.5 hours/day of work is for "government."

123 They really seem to think it's free money from the government. 

If they claim EIC, it's free to them.  Oh yeah, and the earned part...  I don't know whether to spit or laugh.  I've known people who collected welfare and then get a "refund" check for another $15-20k on top of it, though that was some years ago and the breeding jackpot laws may be changed now.

124 Bankruptcy is not just the best way to deal with this; it's the only realistic way.

We simply disagree on methods my friend. I don't believe there is a one size fits all solution and it needs to have multiple prongs. For example, in NY the pensions are guaranteed by our Constitution. Besides the fact that nonsense needs to be removed, a near impossibility in this political nightmare-land, they also need to change the pension plan to a well structured DC starting yesterday.

Now I bet of they hold bankruptcy out there as a negotiation tactic, a crafty governor (not this current one) might be able to wiggle some nice restructuring out of the pension/benefits process. Remember the NYS Constitution says " benefits of which shall not be diminished or impaired". If it is changed by agreement with the alternative downside for recipients being "sorry, we're broke!" and we will let the courts figure out where you are in the food chain, it becomes a pretty effective tactic, IMO.

By the way, what Muni Bond Market? There still is one?

125

121 The be prepared Monty for having a lot of wealthy liberals voting -- in ever increasing majority as they squeeze most of the middle and working class into the position of being serfs, which you in turn will support wholeheartedly, as it fits with your ideas of "skin in the game"   

As far as my emotionalism goes: permit me the extreme sadness of seeing people who don't realize that they are helping along some very statist ideas in spite of themselves.

126 129 Unless of course you mean anybody who has to file a W-2...but even then, it is flawed.  Not everyone who is currently on welfare or drawing unemployment is there by choice; some voted for R or TP canidates...do you want to offer them hope of getting out of their position, or will you readily offer them to the opposition?

127 111There's a lot of magical thinking going on about how on earth a state like Illinois or California is going to repay their grotesque obligations -- not just "debt" (bonds and other warrants), but long-term entitlements and obligations (which are just as much "debt" as any other kind).

You'll appreciate the irony. I just got an invitation to attend the California Muni Finance Conference.....

Tee he. Pffft. Bwahahahahaha. Let me just create a rule to automatically redirect that into Junk Mail.

128 Those tools he's speaking were strengthened in CA recently by changing the Prop 13 vote standard, lowering the threshold for passing a budget to a simple majority from a 2/3 requirement. Basically put, CA voters made it easier for the Legislature to raise their taxes or create new "fees" my fellow Californians are in for a very rude & abrupt fiscal awakening in the next couple of years

129 do you want to offer them hope of getting out of their position, or will you readily offer them to the opposition? It's not for me (or the state, frankly) to offer them "hope" for anything. People who pay no taxes but receive benefits are in a tremendous moral-hazard trap: their own self-interest dictates that they vote to continue the public-funding madness forever, as the alternative means a (maybe drastic) cut in their own income. It's the problem of the "seen" versus the "unseen". Taxpaying citizens fund the welfare state but do not profit from it to nearly the extent that a nontaxpaying citizen does. This is one of the reasons I favor some version of a flat tax (a flat 10% at all income levels, let's say) or some consumption based tax (as long as it's in place of and not in addtion to our current tax code). The free-rider problem is an ancient one, and it's the primary reason that few democracies survive more than a couple of hundred years. Pretty soon the freeloaders bankrupt the state and it collapses from within.

130 Pretty soon the freeloaders bankrupt the state and it collapses from within.

That is exactly where we are headed now. It is also why the founders made it a requirement to own property (and pay taxes) to vote.

131 Doesn't establish Justice come first? 
I'm not the one disturbing domestic Tranquility.
I am paying to provide for the common defence.
They're the bunch failing We the People.

Democrat policies turned everything else in this country into a bad investment.  Let their pensions, etc. take a beating like everyone else.

132 I suggest that Republicans waste no more time or Campaign dollars in Cal, Ill, NY let the libs have them. and let them go down with the ship.  They had their chance this election cycle to correct things...at least in Cal and Ill...they opted for the same old same old.  Sometimes you have to hit bottom to realize what you have been doing to yourself.  Watch their population dwindle and the businesses leave for fly over county where sound minds prevail, and then wall off NYC and Chicago and make them prisons (if the remaining population doesn't burn them down first, that is).

133 I don't share Cantor's belief that states have the "requisite tools" to solve their fiscal problems, or at least not states like California,...

Fuck California.

The state somehow got itself into this mess, so it can find itself a way out. If a lot of people get hurt, well, that's just how things go. The liberal idiots that dominate the state legislature didn't just appear there out of thin air - they were put there by California voters. It's time for those same voters to reap the rewards of their stupidity.

134 There's a lot of magical thinking going on about how on earth a state like Illinois or California is going to repay their grotesque obligations -- not just "debt" (bonds and other warrants), but long-term entitlements and obligations (which are just as much "debt" as any other kind).

It seems like "magical thinking" to believe that allowing states to declare bankruptcy is going to solve these problems.

The money simply doesn't exist. The contracts and obligations are impossible to satisfy. They are not going to be repaid.

You know how younger people complain about paying into Social Security, because we'll never get out what we put in? For the pension plans in these states, that's happening now. Those obligations will go unsatisfied. Companies who expect to be paid may go out of business. Failed municipalities may be forced to disincorporate. Many people will be unemployed.

As far as I can see, this is all inevitable. How will allowing bankruptcy do anything except provide another set of politicians with new powers to manipulate the process to their own ends?

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