Posted on 05/08/2008 8:51:35 AM PDT by SmithL
Vallejo has become the first city in California to file for bankruptcy because it didn't have enough money to provide basic services. This is dreadful news for Vallejo - and its citizens - but it's also an ominous report for the rest of us.
The city council's unanimous decision Tuesday night, which came after hours of impassioned public comment, represents a failure of Vallejo's police and firefighter unions to understand basic economic realities. The unions - whose members are among the highest-paid in the state - refused to allow the city to cut their pay.
Perhaps they didn't believe that times are really as hard as they are. A rise in foreclosures, a dramatic loss of home values, declining retail sales, looting of the city's coffers by the state - Vallejo has been hit hard over the last few years, and it would have been prudent for the unions to allow the city some breathing room. Since they didn't do so willingly, a judge will probably force them to do so anyway, at great cost to all parties involved.
(Excerpt) Read more at sfgate.com ...
This is only the first of government bankruptcies. Every city, county, and school district in the state is watching and taking notes.
Why does this not surprise me?
Two words:
Government Pension Liabilities.
Ok, three.
Gee, do you suppose that the city government migh have been spending irresonsibly? Naw? Government is the answer, right?
Cut every department in government by 5 percent. Do it again.
Lets hope and pray that this is the first of many in California, and God willing the State will file BK.
I can see no other way out of the uncontrolled Government spending.
Eyeamok
” looting of the city’s coffers by the state “
I guess I don’t know enough about this story to understand the above line.
I think that if I was close to retirement and I worked there, I’d be taking early retirement and choosing the lump sum option. That retirement system is going down.
More of the continuing trend.
Government acts irresponsibly with regard to benefits and costs. What a surprise.
Look at California. In order to appease the squeaky wheels, regulations, taxes and loss of personal liberties skyrocket.
As Mike Church (King Dude) has commented, our personal liberties are being stripped away by Democrats and Republicans alike (not all Republicans are conservatives).
I spoke at a UC-Berkeley housing and mortgage conference at the St Francis Hotel in SF on Tuesday. Listening to the GREENS was horrifying. Their feeling of entitlement was apparent. “We must rid ourselves of yesterday’s technology and embrace the future! (lightbulbs and building “skins” for solar power).” I asked: “Why not just allow drilling in ANWR and off the Florida coast? Problem solved!” They acted like I had committed treason!
Everything was about the “government stepping in” to solve all problems. Where is the Constitution does it allow for such extreme intervention? I really needed The King Dude or Mark Levin to speak along with me.
Nancy Pelosi’s nephew was a speaker. What a piece of work.
There are municipal, county and state governments across the country, that went on an orgy of spending and new social programs, due to increased tax receipts from sales and property taxes. Those tax receipts are on their way down now, but the debt and funding obligations remain. Jefferson County, Alabama is having a similar problem, and it’s no small matter. It’s a large county, home to the city of Birmingham, and if it defaults, it would be about triple the amount of Orange County, CA, back in the nineties.
Typically, it involves altering the formula for distribution of state sales tax monies, to the disadvantage of smaller municipalities and unicorporated areas.
When I hear the leftists calling for government intrusion in a new area, I always say that such a level of intrusion sounds Fascist to me and reminds me of a program that Mussolini intoduced as he moved from International Socialism as covered by the Communist agenda to his socilaistic solutions of Fascist programs.
They love hearing how they are now fascist.
Somewhere, Bob Citron (who in the early 90’s ushered in the era of the governmental bankruptcy option) is either jumping for joy in his mansion paid for by the State of California, or doing cartwheels in his grave, depending on his life/death status.
After 20+ years as the Orange County treasurer with unlimited power, his downfall was derivatives, which didn’t take into consideration a possible decrease in interest rates—designed by brilliant Harvard MBA’s who forgot about that remote possibility.
With a modest drop in interest rates, Citron crashed Orange County to the tune of about $2 billion, with criminal aiding and abetting by the wizards of Wall Street (who took advantage of Citron’s stupidity).
As I’ve said before, if you hire a Harvard MBA because you want the title he/she tacks on to his/her name, better be prepared to tack on many, many zeroes to the LOSSES you will no doubt experience.
No group of wunderkinds can lose money at a faster pace than Harvard MBA types.
I watched the Vallejo meeting, and there was one sign of hope in the whole four hour discussion. Many, many, members of the public were finally standing up and demanding that their elected officials act as responsible guardians of the public’s purse instead of as slaves to the whims of the fire union. It's long overdue, and, if it spreads, it offers some hope that the public will finally start to give a damn about recovering control of its government.
Let them strike if that is what it takes. In the eye of the public when it is explained what the union demands will mean to the citizens the public image of the employees will sink. besides what will they do if they don't get their demands met? Where does a Fireman go to earn $100,000 plus a year if all the surrounding municipalities are in the same boat? Ditto with Policemen, Sanitation workers and the rest. faced with a cut in benefits and a smaller raise or no job at all which do you think they will ultimately choose?
I think I know.
>“Why not just allow drilling in ANWR and off the Florida coast? Problem solved!” They acted like I had committed treason!<
I mentioned ANWR at college once. Mostly, I was met with blank stares, but there was an arab who looked at me like he wanted to kill me right where I sat.
I guess he must have known I don’t want US money to be willingly given to our enemies and financially aiding them in our destruction.
you forgot to add:
REPEAT AS NEEDED
Monthly.
OK, I’m trying to stir up a few memory cell, but here’s what I remember.
I liked Pete Wilson, but I know a lot of people around here don’t. He was, however, a real fiscal conservative. He also didn’t trust local governments and public-service unions. He assumed that local politicians would be willing to give away anything to keep getting reelected, so he had the State raid local property taxes, and then, metered the money back to the local governments. This worked pretty well to keep costs down for as long as he was Governor.
But Wilson was replaced by Gray Davis, who stayed true to his tax-and-spend principles, and kept the local money and used it for a down payment on massively expensive government programs.
Schwarzenegger was elected by promising to “Blow up Boxes” in Sacramento. I’m still waiting to see that happen. The unions won every ballot initiative in 2006, and since then, they’ve owned the keys to the State treasury.
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