U.S. States Must File Bankruptcy At Some Point


#1

Newt Gingrich is taking heat for predicting that a bill defining the parameters that States can use to file bankruptcy will be in Congress soon.

State bankruptcy bill imminent, Gingrich says | Reuters

Most of the spin on this story is about the poor state workers who were “promised” pensions and now won’t receive them.

I say that these “poor state workers” are the ones who used their political clout to demand far more than what was reasonable and held the citizens hostage to get their demands.

I think the Just result is for states like mine (California) to go bankrupt and leave an impression on future generations who might be dumb enough to allow Public Employees to form Unions.

If “the promise” is going to be talked about then the “responsibility” of who made the demands and threatened public chaos via strikes must also be discussed just as loud.:smack:


#2

It would be nice to think that having to declare bankruptcy would humble California, but we all know it won’t. Any company or entity dealing with them right not should get any assistance when they don’t get paid and go down they tubes also.


#3

Bankruptcy for states is lunacy.

State and local governments need to borrow money for “tax anticipation” among other things. If they use bankruptcy, who is going to lend them money in the future ???

Idiots all.

.


#4

Banks will still lend, they will just demand to see a financial model that makes sense instead of just assuming “It is the State, they will figure something out”.

I have no problem with States having to prove their credit worthiness to get bank loans. I have to do that and it encourages responsibility.

In fact, even individuals that declare bankruptcy are not completely cut off from the credit markets, they pay more interest but that is just motivation to take better care of their credit next time.

I would LOVE to see the childish “kick the can down the road” politicians learn some of these lessons the same way that most citizens learned them in their twenties, the hard way.


#5

I know a person who has filed bankruptcy twice and now is in the hole to the point she has to file again. The problem is I think she deliberately embarks on a path that leads to this situation because efforts to change her behavior is met with excuse why she has to do what she does.

She went to having no credit to having credit accounts all over the place and she likes to borrow from these finance companies which charge a hefty rate.

Bottom line she wants to do this and like the government which can ask for more money and make appeals they need it while **deliberately **jacking up their costs.


#6

I believe PA has declared bankruptcy twice - not while I have been living here - either in my early life, or since I retired. Both “in between.”