Posted on 01/02/2009 1:05:34 PM PST by NormsRevenge
A group of Democratic governors warned Friday that without as much as $1 trillion in federal assistance, many states will not be able to pay their bills in the next year.
“There are states that are talking as California has of not being able to meet their financial obligations in the coming months,” New York Gov. David Paterson (D) said on a conference call with reporters. California announced in December that all state employees would be forced to take two days of unpaid leave.
Paterson was joined by New Jersey Gov. Jon Corzine (D), Massachusetts Gov. Deval Patrick (D), Ohio Gov. Ted Strickland (D) and Wisconsin Gov. Jim Doyle (D) in warning that states across the country will be forced to make drastic budget cuts in the face of unprecedented deficits.
“We are not crying wolf, this is one of the worst situations our states have faced,” Strickland said. “This is a real crisis. These are real problems. And if we don’t get some significant assistance many of those in our states will suffer greatly.”
Strickland added that the situation facing the state of Ohio is so dire that in order to balance his state’s budget he would have to fund every state program at 75 percent of its current level. “If I were simply to flat fund the operations of this government I’d end up with $7.3 billion in deficit,” he said. “We’re just trying to keep afloat.”
In order to make up for the shortfalls, Corzine said the incoming Obama administration and Congress will need to free up $1 trillion in federal spending for state assistance. “We’re all going to be Herbert Hoovers if we’re not careful here,” he said.
(Excerpt) Read more at news.yahoo.com ...
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drastic budget cuts .. unprecedented deficits ..
More madness from the Left... the same folk that got us in this mess want more to bail-out them out of the mess they got us in.
How's that unfettered rush to Socialism working out for ya, America?
CUT SPENDING NOW.
The only real solution.
Why is that so hard?
This is so done, so over.
I am reading 'The Law' by Frederick Bastiat. When I posted my vanity about this on NYE, I received some very nice replies. I suggest anyone, ANYONE who feels as I do, read the book. Your eyes will be opened.
AND DONATE TO FREE REPUBLIC. We need this forum.
Amity
L
Awwww, the sanctuary state of Mexifornia is broke and needs money! Poor widdle babies!!
Since State officals did this, they should go without pay until the problem is fixed. How long do you think it would take to fix the problem and balance the budgets without raising taxes on the working folk? Not long I would bet
Lots of ‘Ds’ in this article...
Cutting spending and I might add cutting taxes too, has been the solution all along. The liberals will never do either and I include liberal republicans in that too.
Zerobama wants to give “tax rebates” to people who don’t pay taxes to begin with. It’s liberalism insanity.
I’m moving to Alaska and joining a secession movement.
There. See how easy that was.
Our Township Board of Supervisors just passed a budget without a tax increase for the 7th straight year. They had to cut a few things, but are still providing the required services to the citizens. I’m not comparing a TWP to the size of a State budget, but the budget process is the same. Maybe Arnold and his spendthrift buddies should say NO a few times.
just posted this, The Pubs will not go quietly or so they say.
Republicans may slow Obama’s economic plans
http://www.freerepublic.com/focus/f-news/2157791/posts
FDIC To Sell IndyMac To IMB Management Holdings Unit
Last update: 1/2/2009 3:39:52 PM
By Jessica Holzer
Of DOW JONES NEWSWIRES
WASHINGTON (Dow Jones)—The Federal Deposit Insurance Corp. has signed a letter of intent to sell IndyMac Bancorp, the large California thrift that went bust in July amid mounting mortgage defaults, to a thrift holding company owned by a group of hedge fund and private equity firms.
The FDIC said the buyer, IMB HoldCo LLC, will pay approximately $13.9 billion for the thrift when the transaction closes. The agency estimated that would occur in late January or early February.
IMB HoldCo has agreed to inject roughly $1.3 billion of capital into the thrift and bring in new management. The FDIC has agreed to share in the losses of a portion of loans as long as the new owners continue the loan-modification program the agency launched after it seized the thrift.
IMB HoldCo is a subsidiary controlled by IMB Management Holdings LP, whose owners include private equity firms J.C. Flowers & Company and Dune Capital Management and the hedge fund Paulson & Company.
The FDIC said the cost to its deposit insurance fund of resolving the failed thrift would likely fall between $8.5 billion and $9.4 billion. The agency had initially estimated the failure would dent the fund by $4 to $8 billion but later increased its estimate to $8.9 billion.
IndyMac, once the ninth-largest U.S. mortgage lender by volume, specialized in Alt-A mortgages, which typically require little documentation or verification of borrower income. The loans crumbled along with the California real estate market. The FDIC seized the bank after depositors withdrew more than $1 billion in less than two weeks.
At the time of its collapse in July, the thrift had roughly $32 billion of assets and about $19 billion of deposits. Depositers formed long lines outside its branches in scenes reminiscent of the Great Depression, even though the bulk of deposits were insured by the FDIC.
After it seized IndyMac, the FDIC halted all foreclosures on defaulting loans in IndyMac’s large mortgage portfolio. In August, it unveiled a plan to modify roughly 40,000 loans. So far, the agency has completed around 8,500 modifications.
They're already running full tilt. Gonna have to build new ones. Not that they wouldn't.
what a great idea!!!
State Govt. can be Broke - WITHOUT - the citizens being broke.
Citizens can keep on keeping on and give less money to their state Govt.
Why is it only Democrat Governed States ?
Don't treat California like every last person in the state is a leftist. There are lots and lots of good people in that state that are getting bent over due to liberal pie in the sky programs. The major city's voting blocks are ruining the state.
BTW, CA. is home of FR.
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