The Conversation

The inevitability of government bankruptcy and creditor fleecing

In response to Judge Rules Stockton Can Enter Bankruptcy:

Boy, when bloated governments sit down to "negotiate" benefits with their most ardent deep-pocketed supporters, the magic really happens, doesn't it?  Too bad taxpayers don't have any representatives at these "public employee union negotiations."  But we just get stuck with the bill.

Rush Limbaugh was talking about this today.  Stockton has firefighters who cost the city $157k per year in pay and benefits; they get to retire at age 50 at 90 percent of their peak salary, plus free lifetime benefits.  I'm second to none in my admiration for firefighters and other first responders, but to use a popular term, this is utterly unsustainable.  

Throw in the rest of the corrupt one-party rule Stockton has enjoyed for decades - or substitute your favorite alternative blue-state basket case, from the city of Detroit to the state of Illinois - and you've got a lot of financial Armageddon clocks ticking down.  When they detonate, everyone will be told they are living through an unavoidable disaster, in which there are no good options: bailouts must be paid, creditors and bondholders must get the shaft, taxpayers must pay more.  Too bad they didn't tell voters that, during the long years when unsustainable commitments were piled up, borrowed money was spent like water, and gullible voters were assured everything could be fixed with a few tax increases on wealthy fatcats.

The name of the game is setting up disaster so that its architects can skate off with their power and fortunes intact, while everyone else gets to choose between rocks and hard places.


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