We are a commune of inquiring, skeptical, politically centrist, capitalist, anglophile, traditionalist New England Yankee humans, humanoids, and animals with many interests beyond and above politics. Each of us has had a high-school education (or GED), but all had ADD so didn't pay attention very well, especially the dogs. Each one of us does "try my best to be just like I am," and none of us enjoys working for others, including for Maggie, from whom we receive neither a nickel nor a dime. Freedom from nags, cranks, government, do-gooders, control-freaks and idiots is all that we ask for.
Our Recent Essays Behind the Front Page
Monday, November 22. 2010
State Bankruptcies For A Renewed America
The end of the line is rapidly approaching for unsustainable government spending. The states will be the first to reach that station.
The arrival will be a painful crash. The impact will reshape much of the US government policies of the past half century. The triage of those affected will raise bloody howls of anguish, and none will escape the effects.
Those who survive the fittest will be those most adaptable to a renewed America of more effective use of personal and financial resources. All will face difficult choices. True need will be better defined, to protect those really unable to cope. True merit will be better rewarded.
Most agree that the root cause of the crash, the bulk of most of the deficits, is bloated government policies and the agencies that implement them. Some argue, instead, that the gap be filled by increased taxes, not facing that spending excesses will then require more again, further reducing the incentives to produce and afford taxes.
I’m not one to say that government workers goof off more than private industry workers. It’s not their work ethic that I fault. It is the policies that political leaders set them on that are at fault both for the financial ruin that most states and the federal government face and for the frustration expressed by taxpayers over servicing a better paid civil service than themselves.
A conservative commenter thinks that President Obama will act with his “natural tendencies to ‘rescue’ and ‘control’ things” and that “The nature of his response could determine his tenure at the White House.” A liberal commenter thinks that former US Senator Alan Simpson’s remark, that “the blood bath will be extraordinary” in April when the federal debt limit comes up for a required vote to increase it, when – the commenter fears – “we can only hope that the nation that emerges from that blood bath is still one we recognize.” (Republicans will require spending cuts.)
The public mood is contradictory. Most want someone else’s ox to be gored. Increase someone else’s taxes. Cut someone else’s entitlement. Slash government payrolls. Don’t eliminate the program that benefits me.
This time, however, as in the case of California’s continuing $25+ billion structural deficit, over a quarter of its budget, there are no more cans and the end of the road is before us.
Leaving it to the politicians has meant cost-cutting nibbles and kicking the can down the road with accounting tricks. Court challenges have often resulted in reversals of spending cuts, due to judicial quibbles, activism, or faulty drafting of the cuts.
Federal legislation would be needed to allow states to declare bankruptcy, or to forbid bailouts of the states, or the Congress may simply refuse to bail out the states. More howls, and more judicial meddling. But, it is the necessary next step, if Congressional budget-hawks have the wings to withstand downdraft counter-pressures from many voters at home and, instead, soar to responsibility. State legislators and governors will be forced to make hard choices.
At the state level, civil service unions will have to renegotiate contracts. Program excesses will have to be trimmed. Some taxes may be raised. There will, then, be carry-over to federal programs. There will be increased demands to trim spending mandates imposed on the states and to trim other federal programs that will be seen as excessive in light of the dimmed largesse of the states.All will enter a new America, in which there is a more direct connection between one’s own views, own comforts, and own efforts. It will be a difficult adjustment for all, painful for many, and would be a welcome improvement. The alternative is greater difficulties and pain for all if we allow complete insolvency and dissolution of assets by avoiding the confrontation with realities.
Posted by Bruce Kesler in Hot News & Misc. Short Subjects, Our Essays at 11:48 | Comments (7) | Trackbacks (0)
Display comments as (Linear | Threaded)
I seriously doubt that any kind of bankruptcy law is going to pass through Congress and get signed into law in the next two years. I also doubt the Republicans in the House will give bankrupt states a penny of federal money - they better not.
It seems like the rest of the nation - even NJ with Chris Christie - is watching NY, CA, and MA to see what happens when they hit the wall. If the Feds let them crash, the rest of the states will probably fix themselves quickly.
"Those who survive the fittest will be those most adaptable to a renewed America of more effective use of personal and financial resources"
And will be subject to constant looting by those who failed, courtesy of federal "redistribution of wealth" projects masquerading as "bailout", "fairness act", "the rich can afford higher taxes", and other feel-good pseudonyms for government money grubbing.
"I’m not one to say that government workers goof off more than private industry workers. It’s not their work ethic that I fault. It is the policies that political leaders set them on that are at fault"
Yes and no. Those policies often reward laziness and punish productivity.
I and many of my colleagues have worked as external consultants to government agencies, and the pattern is always the same.
If you work dilligently, thrive to be effective and cut costs, you're in trouble. First you get told to slow down so the rest of the people won't look like they're underachievers, then you're told the money needs to be spend anyway so why not waste it, as next year's budget depends on the department exceeding this year's budget (in other words, waste is rewarded, productivity is punished).
This attitude is endemic across government agencies, the larger the agency the worse it it. (to be honest, it exists to a degree in very large commercial enterprises as well, especially at the middle management level).
The question is, "Can the taxpayers afford any more taxes without addressing the jobs issues?" Without jobs, where do they think the money is coming from?
Would to God I were as sanguine as you, Bruce. I see only one possibility - the can will be kicked until it can kicked no more. Politicians simply do not have the moral fortitude nor the courage to do what is necessary. The end result will be the complete collapse of the economy, followed quickly by hyperinflation, as printing money becomes the only "way out" of the dilemma.
After that it's anybody's guess. But it will no longer be the USA.
Other commenters are correct. I spent too much time as a "contractor" to a .gov agency.
Waste, fraud and abuse.
I saw people hired just to keep chairs warm, so the "position" wouldn't be lost.
I watched MILLIONS of dollars wasted - "if we don't use it, they'll cut our budget next year!"
I had employees IN MY FACE when I tried to make things better -- QUOTE: "Uncle Sugar's going to s**T a check twice a month for the rest of my life - these people will see you DEAD before we let you f*** that up for us!"
I watched others draw a six-figure .gov salary and spend their days running private businesses for profit (using .gov office, computer, phone, etc to do it) surf porn, work-over dating sites, etc. ANYTHING BUT earn the salary they were drawing.
Generally, the ONLY people working in a .gov agency are the "contractors."
This is when I really became a hard-core Constitutionalist/Conservative/MINarchist. After seeing what I saw - and being told by others that this was the BEST agency (all the others were much worse) well...
It's long past time to tear the whole thing down and start over.
Itwon't be pretty, but neither will waiting for it to collapse on its own....
God help us - and God Save Our Republic!
Most blatant example a former colleague told me he'd witnessed while a contractor at an IT department for our department of public works.
It was november, there were several million Euro left on the budget noone knew what to do with and it had to go or they'd be cut the next year.
So one person had a luminous idea, they'd order several truckloads of expensive IBM personal computers (talking hundreds of the things for a group of a few dozen people).
Rather than using them (which would be foolish, as then they'd have leftover hardware budget for office computers soon) the new machines would remain in their boxes and palletized in a warehouse. In 3 years they'd have been written down (that's the legal minimum time to write down desktop computers here) and be shipped off to a landfill.
Several weeks later, multiple tractor trailers arrived and filled a warehouse with the computers. And indeed 3 years later several more trucks appeared and carted them all off to a landfill.
There's a good reason to be diligent in identifying and rejecting federal benefits: when it's time to cut the public budget, we shouldn't be the ones quailing for fear that it's our own ox that will get gored.
None of us should ever have to depend on federal benefits. Our lives can be ordered without them. When we slip into relying on them, we're just begging to be blackmailed.
Tracked: Nov 22, 13:10