WTF!?! States Declaring Bankruptcy Can Invalidate State Constitutional Terms?

[Headless Thompson Gunner]

We've been trying to dump Detroit off onto Canada for years.  Grampster may have just found a way to pull it off.

 

[AmbulanceDriver]

Oregon would be ok taking Northern Cali...  Southern Cali, you're on your own.............

[HankB]

Oregon would be ok taking Northern Cali...  Southern Cali, you're on your own.............

Isn't Southern California already a de facto part of Baja?

[longeyes]

State bankruptcy is no panacea.

For starters, a State that ends up in Federal receivership status will be a de facto judicial tyranny, run by a Federal magistrate (probably a liberal).  That what anyone here wants?

Secondly, a run of state bankruptcies would destroy the vast municipal bond market.  Who will ever hand over serious money to a state or municipality once this precedent has been set?

Point is, these problems were precipitated by years of leftist malfeasance; the "solution" is NOT abrogating constitutional order and trustable financial markets.  The answer lies in sober austerity, no matter how deep or how long--if we want to keep any semblance of republican governance.

[makattak]

State bankruptcy is no panacea.

...

Secondly, a run of state bankruptcies would destroy the vast municipal bond market.  Who will ever hand over serious money to a state or municipality once this precedent has been set?

Just like all those runs of corporate bankruptcies destroyed the corporate bond market... right?

[Boomhauer]

Secondly, a run of state bankruptcies would destroy the vast municipal bond market.  Who will ever hand over serious money to a state or municipality once this precedent has been set?

Why, you don't need people willing to buy bonds when you can use governmental force to seize their money, property, etc...

[AJ Dual]

The answer lies in sober austerity, no matter how deep or how long--if we want to keep any semblance of republican governance.

This, cut until they make ends meet.

The results of DEEP cuts into "vital services" and how life doesn't come to a screeching halt, might be enlightening to a lot of people.

[longeyes]

Just like all those runs of corporate bankruptcies destroyed the corporate bond market... right?

Be thankful you weren't a GM bondholder (were you?). 

The Obama gov't set a very bad precedent there.  We learned that when politics goes as bad as ours has you can find cooperative bankruptcy courts to do the bidding of the Most High.

[just Warren]

California has a 21 Billion dollar budget deficit, in addition it has a 500 (five hundred billion) dollar liability with unfunded pension payments (over time) for state workers.


California spends 46 billion on eduction. That's 54% of the budget.

Here's my idea. Get California out of the education business entirely. Savings = 46 billion a year.  So, even if there are no other cuts, and really there could be, California goes from 21 B in the hole to a 25 B surplus.

And yes, by law, California must spend X amount on education per year...but that can be set aside by the bankruptcy court.

Next, tell the unions they will get 50 cents on the dollar on their pensions paid out over 20 years, or a whole lot less as they get a bronze handshake as they leave government service as their jobs will be privatized and their state pensions de-funded. It would be possible. If the Governor or the court can take down the teacher's Unions no other union stands a chance.
 
That's 12.5 B a year leaving room for a 12.5 B tax cut. If more things can be cut the better of course.

[KD5NRH]

If a state declares bankruptcy, their entire constitution should be invalidated. They should become a territory and have to reincorporate as a state or several states.

Under new management, and after selling off any nonessential assets.  (With certain restrictions; DoI gets first shot at existing state parks, etc.)

Splitting California into north and south might not make the south any smarter, but it would remove their burden from the north, effectively restricting the suffering to those responsible for it.  By the same token, the new State of Chicago wouldn't be dragging Illinois down any more.

[just Warren]

If California is to be split, I'd rather it be coastal and inland instead of north and south.

If it goes north and south the south will be dominated by L.A. and the north by San Francisco. My way groups the blue areas with with each other and leaves the red areas apart.

This map shows county by county. The brighter the color the more one way the voting went. So you see the coastal area is dark blue and the inland areas slightly purplish. 



There would still be work to do but it would be a lot easier.

[kgbsquirrel]

Splitting California into north and south might not make the south any smarter, but it would remove their burden from the north, effectively restricting the suffering to those responsible for it.  By the same token, the new State of Chicago wouldn't be dragging Illinois down any more.

Wasn't there a discussion a while back about the creation of city-states once the population of the given city exceeded 50% of the state total?

*goes digging* Nope, it was something I wrote up on another site...

With how large certain cities become (N.Y., L.A., Chicago, etc.), it would arguably seem that these cities as a whole acrue an out of proportion ammount of political control with regards to state matters (making the assumption that the populace of cities tend to vote more as a unified group). Would it then make sense to have a clause in the constitution prescribing that when a single city exceeds, say, 50% of the entire state's total population, that it is then split off as an independant district, ala Washington D.C.?

This discussion actually came up amongst my friends a while back, the general concensus was that exceptionally large cities do tend to skew an entire state's politics. Ie. the entire city votes one way on an issue, where as the rest of the state votes another, but by virtue of the city's size it's votes carry the day and the rest of the state winds up being dragged right along behind it.

As for California, can we just strip the bottom half of anything useful that isn't welded down (kinda like a Navy ship getting decommissioned), cut all the power lines and overland access points and give it to Mexico, "as a gift"?

[just Warren]

Well a 50% threshold would suck for California. Cal has a pop of 37 mil, L.A. is the biggest city at just over 4 mil so there's no chance of that happening. Even if the state pop grew by 20 mil and it was ALL in L.A. that still wouldn't pass the 50% threshold.

Lets make it 10% for cities. OR 15% for contiguous urban areas. 

[kgbsquirrel]

Well a 50% threshold would suck for California. Cal has a pop of 37 mil, L.A. is the biggest city at just over 4 mil so there's no chance of that happening. Even if the state pop grew by 20 mil and it was ALL in L.A. that still wouldn't pass the 50% threshold.

Lets make it 10% for cities. OR 15% for contiguous urban areas. 

Good point. It was just a number I has tossed up during that discussion a while back. *checks* October 2009 to be semi-precise.

[KD5NRH]

Wasn't there a discussion a while back about the creation of city-states once the population of the given city exceeded 50% of the state total?

I'm going to have to go with Warren's numbers; as we see too often, 10-15% in each of two or three urban areas can force the rest of the state to do some really stupid things.  I'd say mandatory separation at 15%, with an option of voluntary secession at the lesser of 8% or 2 million people.

Look at Texas, for example; D/FW is 6.7 million people, Austin's metro area is 1.7 mil, Houston's 5.9 mil, and San Antonio's 2.1 mil.  That's actually a majority of the state when taken together, but only D/FW and Houston metro areas actually have more than 15% of the population each.  Essentially, the 13 million people in those two cities can dictate how millions of other Texans must live, and there's nothing that, say, all of West Texas can do about it.

For an illustration of this, look at the Texas State Senate districts; of 31 senators, Houston metro area has 5-7, (five solely in Houston, and another two whose districts are primarily within the metro area) D/FW 7-8, (same issue)  and all of West Texas has two if you include El Paso's.

Since Houston is in East Texas and Dallas is just barely out of the same region, their climate, geography and economy are vastly different from what West Texas or even most of Central Texas deals with, and letting them force decisions on the entire state makes about as much sense as allowing Houston to annex Orr MN and apply their code of ordinances there. (even if they did add a 15th council seat so Orr could be represented)

As for California, can we just strip the bottom half of anything useful that isn't welded down (kinda like a Navy ship getting decommissioned), cut all the power lines and overland access points and give it to Mexico, "as a gift"?

Detcord and oxygen lances make "welded down" a rather silly reason for leaving stuff behind...and we should keep the mineral rights.

[longeyes]

I love the way you guys hate on SoCal.  Too bad most of you detractors know nothing about the place.  C'mon, guys, America's problems are NOT confined to L.A. or S.F.

If California is to be split, I'd rather it be coastal and inland instead of north and south.

If it goes north and south the south will be dominated by L.A. and the north by San Francisco. My way groups the blue areas with with each other and leaves the red areas apart.

This map shows county by county. The brighter the color the more one way the voting went. So you see the coastal area is dark blue and the inland areas slightly purplish.

I think you need to read some Victor Davis Hanson.  If you did you'd know that the interior of California isn't populated by Tea Party patriots but, mostly, by impoverished Central Americans increasingly living in shanty towns and pulling in gov't checks while they watch the farmlands dry up.

L.A., actually, taken as greater L.A. has far more four million people.  Try doubling that, and then some. 

I don't like what's happened to my home city either, but we can thank the Federal government for most of the changes.  L.A. has turned into a Mexican city, and the State legislature exploits this reality.

[longeyes]

Yeah, if a state goes bankrupt they should invalidate their state Constitution and be absorbed by other states?

Are you serious?  You will end with half the country being a Federal protectorate--i.e., a "reservation" for Legacy Americans.

Bankruptcy is a ruse that will produce nothing but a diminution of liberty and a subversion of contract law.  The answer is to balance the books by making the draconian cuts that are necessary and moral.  Just as with ObamaCare, which predicates itself on The Forty Million, this problem largely resides in cheaters, slackers, and trespassers. 

[Monkeyleg]

The answer is to balance the books by making the draconian cuts that are necessary and moral.

And the people who are living off the CA government will go to nearby states and begin draining them of cash.

[Waitone]

Regardless of the negatives states and fed.gov had better get off the dime and put provisions in place for cities and states to seek the cover of bankruptcy.  Cities are lining up as we speak and states are not too far behind.  The absence of a bankruptcy process will eventually create chaos as pension funds try to suck more out of the taxpayer, states try to shed their responsibilities, and fed.gov gathers more power to itself.  Solutions are available and viable but not politically acceptable. 

Here in SC the teacher's retirement fund is grossly (I repeat, grossly) underfunded.  Educrats solution is the suck more out of the taxpayer.  My solution is quite simpleminded.  Deem the pension play whole at whatever the current funding is and adjust benefits to current funding.  That is all.  Teacher retirees will bitch and moan but so what.  We've got officially 9.7% unemployment.  The real figure is pushing 20%.  I don't see how we can morally stick a gun in the face of what's left of the employed to "fully fund" a retirement program that is far too generous and expensive. 

We've only seen the beginning of trouble if we don't get adults to address the problem.  The good news is the ship of fools we call congress is actually thinking about what Joe and Martha Sixpack see coming down the road.

[longeyes]

The answer need not be bankruptcy.  We do have electoral processes whereby we can change the tax laws or even the State constitution.  We also have the power of political organization, mass demonstrations, even civil disobedience.  People do NOT have to just keep paying into an unfair system.

California cannot deal with its budget problems except by going through THE TRUTH.  That truth is that one way or another we will need to enormously cut gov't services, re-negotiate pension agreements, and force the Federal gov't to deal with illegal immigration.  On the last we heard just the other day that welfare services for illegals and their kids in L.A. County last year cost $1.6 billion--that is without counting education which in L.A. Country has a yearly budget of around $7B.

Putting enormous power into the hands of Federal bankruptcy courts is to begin to operate by para-Constitutional means.  This is exactly what The Left wants and has always wanted.

[Hawkmoon]

Point is, these problems were precipitated by years of leftist malfeasance; the "solution" is NOT abrogating constitutional order and trustable financial markets.  The answer lies in sober austerity, no matter how deep or how long--if we want to keep any semblance of republican governance.

Sober austerity is a non-answer when the underlying problem is that the debt burden resulting from pre-existing contractual commitments exceeds the state's ability to pay, and the economy is so deep into the tank that attempts to offset the shortfall by raising taxes will accomplish nothing but making the problem worse.

The problem with riding bubbles is that, eventually, bubbles tend to burst.

[longeyes]

Bankruptcy--without addressing the underlying reasons for the shortfall on all levels--is only a Band-Aid. 

[Monkeyleg]

I was born in Flint. Haven't been back there since I was 16 (~1967), but have seen photos since.

I'd bid on it, but only if I can use it for artillery target practice.

[RocketMan]

Oregon would be ok taking Northern Cali...  Southern Cali, you're on your own.........

And Oregon would promptly turn Northern California into another version of Southern California, given how screwed up we are.

[De Selby]

How fabulous - 30 years ago someone agreed to take a government job that pays a lot less than private sector equivalents, because of a contract that specified good retirement pay.  Now everyone wants to screw that guy out of what he bargained for.  The "free market" doesn't work if you don't honour your contracts for lifetimes of work, folks.

The article is ridiculous.  States can't be bankrupt in the same way an individual can.  No one can raid the state's assets without its permission, even where the state defaults;  that's the primary purpose of bankruptcy, so having it for a state is just silly.  States are sovereign - all you need to do is a quick canvas of rights associated with sovereign debt and you'll see why the whole premise of the article is silly.