Posted on 12/06/2010 5:27:44 AM PST by Clintonfatigued
The State of Illinois is still paying off billions in bills that it got from schools and social service providers last year. Arizona recently stopped paying for certain organ transplants for people in its Medicaid program. States are releasing prisoners early, more to cut expenses than to reward good behavior. And in Newark, the city laid off 13 percent of its police officers last week.
While next year could be even worse, there are bigger, longer-term risks, financial analysts say. Their fear is that even when the economy recovers, the shortfalls will not disappear, because many state and local governments have so much debt — several trillion dollars’ worth, with much of it off the books and largely hidden from view — that it could overwhelm them in the next few years.
“It seems to me that crying wolf is probably a good thing to do at this point,” said Felix Rohatyn, the financier who helped save New York City from bankruptcy in the 1970s.
(Excerpt) Read more at nytimes.com ...
The Mother Of All Defaults is coming.........
Could it be that progressives don’t know how to handle money?
Naaaaaaah.
Those named states have it coming big time and I hope they are allowed to go into bankruptcy and those gold plated public wage and pensions benefits cut.
Much of that are public pension IOUs. Its a ticking time bomb with both financial and political consequences. They are already being felt.
For far too long we've been calling them "tax and spend(ers)" when in fact they are "spend, then tax(ers)"
What happens when Congress says “no” to a bail-out, and then the Federal Reserve says “yes” to buying trillions of dollars of bonds from these states? Pretty clear that that is the plan. National the state governments through debt.
The states are too big to fail.
In the past people thought wooden nickles was a joke now it’s the only cash we have.
The NY Times amswer is more debt, right??
The problem is not counting, the problem is counting. The anti intellectuals who shun math are in control and never learned how to count.
Degrees in under water basket weaving do not require knowing how to count. That is also true for a lawyer with an undergrad degree in UWBW
This process reminds me of a drug addict or alcoholic who is deep into his or her addiction. Wild, out of control spending. Using every gimmick and trick in the book to facilitate more spending. Demands to raise taxes even higher above their current historical highs. Borrowing beyond their means to repay it. Anything to keep the binge going.
We are witnessing the collapse of the Welfare State. I hope it is sooner rather than later or else our children’s standard of living is going to be much lower than ours is and they will rightly curse us after we are gone.
It could be that they have no idea what "money" actually is.
Lot of "magical thinking" going on these days.
Even if the Congress says no, the Federal Reserve will do it.
Devalue the currency.... again
All levels of government have been committing fiscal treason.
The next decade isn’t going to be pretty.
All the unemployment is being funded by Fed loans as well. So, I have to wonder what happened to all the money collected over the years from employers?
QE3,4,5,6..........
It's interesting to note that New York is actually in pretty good shape as far as its pension system goes. I believe it has long had a reputation for a well-managed pension system.
What's going to kill New York is its other long-term financial commitment that is funded outside its pension system: medical insurance for government retirees. I read a recent article indicating that New York State is facing a $200 billion cost for this item over the coming years -- and all of that is paid out of their general revenues.
The pigeons are coming home to roost, folks.
The stupid TARP and Porkulus packages made this almost inevitable. Giving the States multiple BILLIONS that they would spend irresponsibly and which would run out within 2-3 years and they could NEVER replace virtually guarantees that some if not MOST of the States will collapse economically. But Obama and his team team full of Van Jones types KNEW that would happen. They are literally “banking” on it (pun intended).
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