Should We Let California Go Bankrupt? [Answer: Yes!]
But also expect Washington to take some heat if it simply bail outs out California, especially now that we have governors like Mark Sanford of South Carolina pointing out that the federal aid to states amounts to a subsidy by citizens of fiscally responsible governments to states where legislators have chucked responsibility out the window.
Back in the 1970s, New York City was on the verge of bankruptcy and despite a famous headline (Ford to City: Drop Dead), both the feds and New York State eventually bailed out Gotham, but under strict conditions. They imposed a financial control board which required demanding cuts to services, a new, more transparent budget process and several years of budgetary oversight. Maybe what Washington should impose on California will be a national version of a financial control board to shake some sense into state legislators.
Otherwise, we can always allow the state to default on debt and let its lenders start dictating the terms of California’s budget reforms. Go ahead, California, make my day.
It’s a good read. And if you haven’t read “Governor Girly-Man” in the latest National Review, you should.
There’s always a temptation with headlines in the form of questions to respond with a snap answer. Here are a few for other recent columns with questions for headlines:
Will Holder Address These Five Racial Issues? — Answer: Not if he can help it. Illegitimacy? Crime? This isn’t Daniel Patrick Moynihan we’re talking about.
Is Obama Moving Away from Fear-Based Politics? — Answer: You’re kidding, right? Ask Bobby Jindal about that allegedly irreversible economic crisis.
Where Was National Security? — Answer: That was the Bush administration.
Who’s to Blame for Losing Turkey? — Answer: Turkey.
Can Obama Restore Our Faith in Government? — Answer: You had faith in government?
Obama Soars, But Can He Fix the Economy? — Answer: No, but he’ll take credit for it, anyway.