Let States Go Bankrupt

[Missourian]

Pentagon spending on health care has increased from $19 billion in 2001 to a projected $50.7 billion in 2011, a 167% increase.

Military's health care costs booming - USATODAY.com

Looking for the retiree pay costs, as I recall it was around 7% of what the the total pay for active duty personnel is.

Please explain how cutting the military budget will help a state's bottom line.

You're kidding right?

States pay federal taxes.

I need a link to that, please.

That State Governments pay Federal Taxes...otherwise, Uscitizen's comments are nothing but deflection.

 

[LordBrownTrout]

I can just see Obama salivating over that 11 trillion sitting in the 401k accounts of the middle class.....

Wanting to nationalize retirement funds is just more proof that Obama doesn't give a rip about the middle class....he is much more interested in funding his union power and pet programs......which is MORE than enough good reason to allow the states to go bankrupt.....let the states cut and trim their overbloated state and city pension funds....which of course they created in the first place....

....and in the process cut those government unions down to size....

I'll definitely be cashing out before that happens.

Hope you don't mean 'cashing out' as in 'he bought the farm'...

No, I'd just be trying to hang on to my property.

 

[Sallow]

Please explain how cutting the military budget will help a state's bottom line.

You're kidding right?

States pay federal taxes.

I need a link to that, please.

That State Governments pay Federal Taxes...otherwise, Uscitizen's comments are nothing but deflection.

The Tax Foundation - Tax Research Areas > Federal Taxes Paid vs. Spending Received by State

 

[Dont Taz Me Bro]

My only complaint is, this doesn't distribute the pain fairly or rationally.

Why not?

 

[Dont Taz Me Bro]

If there's money to do a billion dollar deal with Raytheon to build missile defense systems that don't work..then there is money to pay the pensions of ex-firechiefs and other government employees..that PAID into the system.

Yes, they did pay into the system. They also elected politicians over the years who wasted it away and made promises to them that couldn't be kept. You reap what you sew.

 

[Sallow]

If there's money to do a billion dollar deal with Raytheon to build missile defense systems that don't work..then there is money to pay the pensions of ex-firechiefs and other government employees..that PAID into the system.

Yes, they did pay into the system. They also elected politicians over the years who wasted it away and made promises to them that couldn't be kept. You reap what you sew.

That doesn't give anyone the right to break a contract.

 

[ScreamingEagle]

Best thing to do is to let the bankrupt states claim bankruptcy. They can then renegotiate the union contracts that bankrupted them. If the federal government bails them out, they will just go bankrupt later.

No can do.


Contracts must be enforced.

Federal government will look to pay the unions...

now were could they find an extra $3 trillion....

As far as i know the Federal government is not required to be on the hook for insolvent states....(altho it has been helping them thus far)....they can be put into receivership...much like a bankruptcy....

Say the state can't make its debt payments, and no one will lend it any more money. In that case, the federal government can step in and put the state into receivership. This would involve the assignment of an accountant to manage the state's debt, overseen by a judge. It would be a lot like bankruptcy, except instead of following a structured set of steps—informing creditors, appointing creditors' committees, a 120-day window to file a plan, etc.—a receiver has the authority to force creditors to renegotiate loans in a speedy fashion. However, the accountant in charge would not have the power to make decisions about the state's budget, such as which programs needed to be cut and which taxes had to be raised. (No state has ever gone into receivership.)

Can California declare bankruptcy? What about Greece? - By Christopher Beam - Slate Magazine

 

[Synthaholic]

Tragic while that may be, there is an old saying.. "that which cannot continue, will not continue."

There ain't no mo money.

If there's money to do a billion dollar deal with Raytheon to build missile defense systems that don't work..then there is money to pay the pensions of ex-firechiefs and other government employees..that PAID into the system.

Psssst! There's no money for that either, yet that isn't why it was cut, we all know that.

And spare me the boo hoo over Fire Chiefs. Where I live these guys make MEGA BUCKS between salary and details and get very generous pensions that they DO NOT pay into. Many public servants collect pensions far longer than they worked.

Read the story before you continue your dickish behaviour.

http://www.nytimes.com/2010/12/23/business/23prichard.html?scp=1&sq=alabama pensions&st=cse

 

[Oddball]

If there's money to do a billion dollar deal with Raytheon to build missile defense systems that don't work..then there is money to pay the pensions of ex-firechiefs and other government employees..that PAID into the system.

Yes, they did pay into the system. They also elected politicians over the years who wasted it away and made promises to them that couldn't be kept. You reap what you sew.

That doesn't give anyone the right to break a contract.

Bankruptcy does....That's what it's all about.

But don't worry...Socialist politicians won't hang their useful idiot dependents in the bureaucratic bourgeoisie out to dry.

 

[Vanquish]

Psssst! There's no money for that either, yet that isn't why it was cut, we all know that.

And spare me the boo hoo over Fire Chiefs. Where I live these guys make MEGA BUCKS between salary and details and get very generous pensions that they DO NOT pay into. Many public servants collect pensions far longer than they worked.

Sure lets talk of cutting off military pensions and see what happens?

Or maybe the firemen just quit and your house burns down, you will be runing for a lawyer.

As long as it is someone else...

Oh good grief. You always want to stick it to the military as a first resort.. why?

Because it's a sacred cow of the Republicans.

Hmmm, how better to put it. Dems see Republicans as wanting to "have their cake and eat it too". Republicans want to talk big about cutting...but they only want to cut what their opponents cherish. Think of it as a sign of good faith...you're serious about cutting? dont just cut what you want to cut...cut something that would be hard for you personally to cut.

Make sense?

 

[Vanquish]

If there's money to do a billion dollar deal with Raytheon to build missile defense systems that don't work..then there is money to pay the pensions of ex-firechiefs and other government employees..that PAID into the system.

Psssst! There's no money for that either, yet that isn't why it was cut, we all know that.

And spare me the boo hoo over Fire Chiefs. Where I live these guys make MEGA BUCKS between salary and details and get very generous pensions that they DO NOT pay into. Many public servants collect pensions far longer than they worked.

Read the story before you continue your dickish behaviour.

http://www.nytimes.com/2010/12/23/business/23prichard.html?scp=1&sq=alabama pensions&st=cse

Ha! That's where my dad grew up and where we have some rental property still on my grandmother's old farm.

The article is spot on about that place. You've got a hard working, under-educated, aging population...no new industry...run down town. I'm not saying they deserve all this. On the contrary...if you were promised a pension, you should get one.

If this happened in Prichard...it could happen anywhere.

 

[Claudette]

Why should the taxpayers of a State in the black be on the hook for an insolvent State??

That doesn't make any sense to me.

If the Fed Govt bails one State out then every other broke State will be standing in line for the Fed, taxpayer dollar, handout.

If they go bankrupt then they will have to renegotiate everything.

As for pension funds. Well. If the State has no money they can't very well make good on anything.

Guess they could throw the folks running the State in jail.

Mayby not a bad idea. Not a bad idea at all. Jeeze.

Wonder how that would play out??

 

[PoliticalChic]

Best thing to do is to let the bankrupt states claim bankruptcy. They can then renegotiate the union contracts that bankrupted them. If the federal government bails them out, they will just go bankrupt later.

No can do.


Contracts must be enforced.

Federal government will look to pay the unions...

now were could they find an extra $3 trillion....

As far as i know the Federal government is not required to be on the hook for insolvent states....(altho it has been helping them thus far)....they can be put into receivership...much like a bankruptcy....

Say the state can't make its debt payments, and no one will lend it any more money. In that case, the federal government can step in and put the state into receivership. This would involve the assignment of an accountant to manage the state's debt, overseen by a judge. It would be a lot like bankruptcy, except instead of following a structured set of steps—informing creditors, appointing creditors' committees, a 120-day window to file a plan, etc.—a receiver has the authority to force creditors to renegotiate loans in a speedy fashion. However, the accountant in charge would not have the power to make decisions about the state's budget, such as which programs needed to be cut and which taxes had to be raised. (No state has ever gone into receivership.)

Can California declare bankruptcy? What about Greece? - By Christopher Beam - Slate Magazine

The reason that the states are in such poor fiscal postitions is the promises to the unions.

The Democrat Party is joined at the hip to said unions.

What do you see as the scenario if the states reneg on contracts, how do you think the Dems in Congress will react?


“After unions spent more than $400 million on the election and mounted massive voter-turnout efforts for Mr. Obama, ...
Labor Wants Obama to Take on Big Fight - WSJ.com

According to the Center for Responsive Politics, AFSCME is the United States' largest single contributor to political campaigns, having donated more than US$38 million since 1990.[12] The organization contributes almost exclusively to Democratic Party campaigns; since 1990 the ratio of Democratic to Republican contributions by the AFSCME has exceeded 98:1. In addition to combating the privatization mentioned above, key political objectives for the group include raising the minimum wage and opposing the substitution of vacation time for overtime pay due workers.[12] In June 2008, AFSCME, along with MoveOn.org, spent over US$500,000 on a television advertisement critical of the presumed Republican presidential nominee John McCain.[13]
1. ^ a b Center for Responsive Politics retrieved 21 June 2007
2. ^ "The Swamp: John McCain vs. baby in anti-war ad". Chicago Tribune. John McCain vs. baby in anti-war ad: The Swamp. Retrieved 2008-06-19.
American Federation of State, County and Municipal Employees - Wikipedia, the free encyclopedia


Tuesday, August 10, 2010
States test whether public pension benefits given can be taken away
By Stephen C. Fehr, Stateline Staff Writer

State legislators are beginning to challenge one of the ironclad tenets of public pension policy: that states cannot legally reduce pension benefits for current and future retirees.

Lawmakers in Colorado, Minnesota and South Dakota voted earlier this year to limit cost-of-living increases they previously had promised to thousands of current and future retirees, who courts historically have protected from benefit reductions. Not surprisingly, retirees in each state have filed lawsuits asking judges to restore their annual benefit increases to what they were previously.
States test whether public pension benefits given can be taken away

 

[Vanquish]

Alabama is 90% non-union. [1]

It's not a union problem here. I'm not pro-union...hell I think they're entrenched and outdated power monopolies, but trying to make such a broad statement oversimplifies the matter, while scoring you points that you don't deserve.

 

[Ava]

So why couldn't we have let GM, the banks and Wall St go bancrupt instead?

Because then our government would not have been in power and control. They liked the term Government Motors. This 111th Congress has amassed over 3 trillion dollars in debt; more than any Congress in history. Print and spend, print and spend....hyper-inflation coming to America.

 

[Revere]

European nations have no standing military on par with the US, and they have all the new and higher taxes American socialists want.

And they are insolvent.

So it's not the military.

 

[PoliticalChic]

Alabama is 90% non-union. [1]

It's not a union problem here. I'm not pro-union...hell I think they're entrenched and outdated power monopolies, but trying to make such a broad statement oversimplifies the matter, while scoring you points that you don't deserve.

This is not an anti-union position...it is an anti-politician postition.

The pols are more than willing to promise anything the unions wish, no matter the result up the road...as long as there is the immediate gratification of re-election.

Further, consider the efficacy of allowing unions in government service...the assumption had always been that one gave up a certain amount of remuneration for the security of government work....
now, it seems that govenment workers make more than private idustry workers.

And to broadly proclaim that "...It's not a union problem here." is to ignore:
"In 2008, states reported that their public-employee pensions wee underfunded by a total of $438 billion. But independent estimates say the underfunding is closer to $3 trillion. Why? The states make up estimates of return at unbelievable levels: the median investment return factored in by state pensions is 8% a year! "
AEI - The Market Value of Public-Sector Pension Deficits

 

[Oddball]

European nations have no standing military on par with the US, and they have all the new and higher taxes American socialists want.

And they are insolvent.

So it's not the military.

Yes they do....It is the U.S. military.

 

[ScreamingEagle]

.

No can do.


Contracts must be enforced.

Federal government will look to pay the unions...

now were could they find an extra $3 trillion....

As far as i know the Federal government is not required to be on the hook for insolvent states....(altho it has been helping them thus far)....they can be put into receivership...much like a bankruptcy....

Say the state can't make its debt payments, and no one will lend it any more money. In that case, the federal government can step in and put the state into receivership. This would involve the assignment of an accountant to manage the state's debt, overseen by a judge. It would be a lot like bankruptcy, except instead of following a structured set of steps—informing creditors, appointing creditors' committees, a 120-day window to file a plan, etc.—a receiver has the authority to force creditors to renegotiate loans in a speedy fashion. However, the accountant in charge would not have the power to make decisions about the state's budget, such as which programs needed to be cut and which taxes had to be raised. (No state has ever gone into receivership.)

Can California declare bankruptcy? What about Greece? - By Christopher Beam - Slate Magazine

The reason that the states are in such poor fiscal postitions is the promises to the unions.

The Democrat Party is joined at the hip to said unions.

Yes....which is why i did my little muahaha happy dance earlier....bankruptcy makes for a great union buster and Democrat waterloo.......

What do you see as the scenario if the states reneg on contracts, how do you think the Dems in Congress will react?

Of course they are going to toe the union line.....that is where Obama's big battle line is....but if a state is broke and simply cannot pay the exhorbitant pensions.....what will they do instead of bankruptcy.....?.....hand out worthless IOUs....? One way or another it has to be resolved.....because as that old saying goes...you can't squeeze blood out of a turnip...(although you can print worthless money...)

It does of course remain to be seen whether or not the new Republican House will legislate to bail or not to bail out the states....paid for of course by the other states who managed their money properly....i doubt those states will vote for it....


“After unions spent more than $400 million on the election and mounted massive voter-turnout efforts for Mr. Obama, ...
Labor Wants Obama to Take on Big Fight - WSJ.com

According to the Center for Responsive Politics, AFSCME is the United States' largest single contributor to political campaigns, having donated more than US$38 million since 1990.[12] The organization contributes almost exclusively to Democratic Party campaigns; since 1990 the ratio of Democratic to Republican contributions by the AFSCME has exceeded 98:1. In addition to combating the privatization mentioned above, key political objectives for the group include raising the minimum wage and opposing the substitution of vacation time for overtime pay due workers.[12] In June 2008, AFSCME, along with MoveOn.org, spent over US$500,000 on a television advertisement critical of the presumed Republican presidential nominee John McCain.[13]
1. ^ a b Center for Responsive Politics retrieved 21 June 2007
2. ^ "The Swamp: John McCain vs. baby in anti-war ad". Chicago Tribune. John McCain vs. baby in anti-war ad: The Swamp. Retrieved 2008-06-19.
American Federation of State, County and Municipal Employees - Wikipedia, the free encyclopedia


Tuesday, August 10, 2010
States test whether public pension benefits given can be taken away
By Stephen C. Fehr, Stateline Staff Writer

State legislators are beginning to challenge one of the ironclad tenets of public pension policy: that states cannot legally reduce pension benefits for current and future retirees.

Lawmakers in Colorado, Minnesota and South Dakota voted earlier this year to limit cost-of-living increases they previously had promised to thousands of current and future retirees, who courts historically have protected from benefit reductions. Not surprisingly, retirees in each state have filed lawsuits asking judges to restore their annual benefit increases to what they were previously.
States test whether public pension benefits given can be taken away

Interesting article....but from what i've read if a state voluntarily goes bankrupt it does not interfere with the Constitution...and municipalities within states already are going bankrupt....so ultimately where would the state get its money in a timely manner anyhow....?

"Start with the issue of constitutionality. The main objection to bankruptcy for states is that it would interfere with state sovereignty—the Constitution’s protections against federal meddling in state affairs. The best known such barrier is the Tenth Amendment, but the structure of the Constitution as a whole is designed to give the states a great deal of independence. This concern is easily addressed. So long as a state can’t be thrown into bankruptcy against its will, and bankruptcy doesn’t usurp state lawmaking powers, bankruptcy-for-states can easily be squared with the Constitution. But the solution also creates a second concern. If the bankruptcy framework treads gingerly on state prerogatives, as it must to be constitutional, it may be exceedingly difficult for a bankruptcy court to impose the aggressive measures a state needs to get its fiscal house in order.

Neither of these considerations—state sovereignty or the limited force of a bankruptcy framework that gives wide berth to governmental decision-makers—is hypothetical. We now have more than 70 years of experience with a special chapter of the bankruptcy code—now called Chapter 9—which permits cities and other municipal entities to file for bankruptcy. For decades, this chapter did not get a great deal of use. But since the successful 1994 filing for bankruptcy by Orange County, California, after the county’s bets on derivatives contracts went bad, municipal bankruptcy has become increasingly common. Vallejo, California, is currently in bankruptcy, and Harrisburg, Pennsylvania, is mulling it over. The experience of these municipal bankruptcies shows how bankruptcy-for-states might work, what its limitations are, and why we need it now."

Give States a Way to Go Bankrupt | The Weekly Standard

 

[Dont Taz Me Bro]

Alabama is 90% non-union. [1]

It's not a union problem here. I'm not pro-union...hell I think they're entrenched and outdated power monopolies, but trying to make such a broad statement oversimplifies the matter, while scoring you points that you don't deserve.

Public sector unions and illegal immigration are the two primary factors causing California's problems.