Two articles from PublicSectorInc.com that touch on the incredibly irresponsible governmental spending that takes place at the state and local level. It’s unsustainable; that’s just a fact. So the public will finally either call an end to it or we’ll need to establish bankruptcy courts for state and local governments. The stealing from taxpayers can’t continue.
Is There a “Blue Civil War” in Our Future?
Russell Mead over at The American Interest highlights some refreshingly frank comments about city worker pensions and Chicago’s overall financial condition from Mayor Rahm Emanuel. The mayor clearly recognizes the impossibility of funding pensions and providing city services, telling an interviewer from The Wall Street Journal that, “… [t]here’s a set of choices. Reform pensions and continue to be able do other things that are essential for a great city, or make pension payments and do certain things to the rest of the budget that are not part of a great city.” Based on this, Mead predicts a “Blue Civil War.” Mead may be right; we may indeed see a political brawl break out between government unions determined to maintain their perquisites and liberal politicians determined to maintain public services at a time when the public’s ability to pay for either has reached its ceiling…
“Everything must be on the table”: A Q&A with Richard Ravitch about fiscal distress
EIDE: Since the State Budget Crisis Task Force released its report last summer, there’s been a lot of good news for state and local governments. The stock market is at record highs, and housing has finally turned the corner. Will this growth be enough for state and local governments, or do we also need to be talking about reforms?
RAVITCH: It’s a hard question to answer in the abstract; it will vary from state to state. But the news doesn’t necessarily mean that the gap between the growth rate in retirement obligations, health care costs, Medicaid expenses, and revenues will be closed. And if that gap continues, then state and local governments are going to continue to face fiscal stress.