Is California Heading for Bankruptcy?

[dnalexander]

I agree with you on the bailouts. As I said in my original post I am against it for California. If it happens things won't change and we will be in the same situation sometime in the future. Our biggest problem, California, US, Auto Companies, Wall Street the bailout just prolongs the pain. No one is willing to forgo their pork, subsidies, etc. Kind of the NIMBY syndrome that will keep you all from benefiting from your wind resource. Just like what keeps you all and California needing federal aid . I know I don't even have to get into the fact that we are doing all this on our children's credit card. Very short sighted.

David

[Teresa]

Well the latest on the local talk show network is that this isn't a "bailout", it is "helping California with it's cash flow..." this straight from a congress woman and the infamous Senator Barbara Boxer. The congresswoman says the feds can't bailout a state; but it can help with some stimulus money to increase the cash flow of the 8th largest economy in the world.

Soooo.. I guess that is supposed to make it all ok...
It's not an economy if it's broke.. so it must be the LARGEST money pit in the world.

[Catwoman]

It doesn't matter what color you paint a pig...It's still a pig.

[sixdogsmom]

And a single note will never become a symphony. 

[Anmar]

I think Gray Davis is laughing at all of us californians right now.

Part of our problem  are ballot initiatives that are voted on every year.  We go to the polls and see something along the lines of....

"shall the state of california issue a bond for 50 million dollars for a new fund that will give money to the police, fire department, and education"

I'm being very general, but you get the point.  Now the bill is likely authored by some special interest groups, but it provides some good community programs, who's going to vote against it?  These measures almost always pass, people vote without thinking about how it's going to be paid for. 

Someone mentioned that we should stop paying out lottery winnings i think, the state lottery is a good source of income that funds a lot of programs,  thats not the problem.  The problem is that people, in general, don't take the time to pay attention to whats going on around them.  A long time ago, you had to own land to vote.  I think what the founders were really going after was that they only wanted intelligent people with strong ties to the future of the country to vote.  Maybe i'm crazy, but maybe we need to get back to that principle (with a few alterations of course)

As far as bankruptcy, i don't think it will happen.  If they go under, the state's credit rating will be in the toilet much further than it already is.  That will have several consequences.  first nobody will loan money to California anymore, which will mean that the federal government will have to bail us out.  Second, the states credit rating will most likely affect the credit rating of other states and the federal government.  Imagine how much trouble we would be in if people stopped buying our debt.

Why save california, the answer is easy.  Not because we're a huge economy, not for the people of california, we screwd up our finances ourselves and we will suffer the consequences.  I was driing back from LA on highway 5 and where there used to be fields of grapes, corn, and various other fruit trees, there was nothing but a big yellow sign that says "Congress created dust bowl."  California needs to be bailed out because we feed the country.

Now, when a school system in california preforms poorly, the state comes in and takes over the administrative side.  We do need a reset, we do need to dramatically change the way things are done.  Maybe the federal government should attach some kind of similar strings, although i'm pretty sure thats not constitutional, but hey, neither are 1/4 of the laws that have been passed in the last 10 years.