Socialist state of California has failed, seeks Fed bailout

[redrumloa]

http://www.latimes.com/business/la-fi-l ... 0998.story

"The enormous size of the required funding together with the state's current credit condition and the continued weakness of the municipal finance market . . . make it highly unlikely that the state can access the short-term market for its borrowing based on its own credit," Lockyer told Geithner.

As the state's cash shortage has worsened in the recession, Lockyer has for months been lobbying for some kind of federal backstop on new debt issuance, which he has said should be extended to all state and local governments to help pare their borrowing costs.

Lockyer has an ally in Rep. Barney Frank (D-Mass.), the chairman of the House Financial Services committee.

Although Frank is in the process of drafting legislation that could create a long-term federal reinsurance program for municipal bonds, it isn't clear what can get through Congress, or how quickly.

Frank told Bloomberg News on Tuesday that he was "working with the administration now . . . to do something short-term" for California.

Lockyer said he believed that the Treasury could create a debt-backstop plan under terms of the financial-system bailout bills passed by Congress in 2008 and this year.

Under his proposal, major banks would provide their customary guarantees of the state's short-term debt, and the Treasury then would agree to stand behind the banks: If the state couldn't repay the debt on time the Treasury would agree to buy the debt, becoming a creditor to the state.

The (not so) great US socialist experiment that is California has failed miserably and the rest of us have to bail out this failure? Red States has no hand in this nonsense, talk about taxation without representation :roll:

What is worse, California is the model that the dems are trying to push through for the rest of the country. We are soooooooooooooooo F***KED!

 

[FluffyMcDeath]

ha ha. What a girlyman.

Remember when California got jacked for almost 10 billion by Enron and Gray Davies was gonna make them pay it back so they orchestrated a recall and put Arnie out in front of them after he agreed that he wouldn't pursue them for the money.

Well, that money would have really helped, eh? Would have saved a ton in interest charges since then too. Deregulation cost Californians a pretty penny. Of course, a different deregulation has cost everyone big too.

 

[redrumloa]

California’s High Tax, High Spending Disaster

http://blog.heritage.org/2009/05/21/mor ... -disaster/

So if low taxes are not to blame for California’s huge deficits, what is? Spending. The Reason Foundation’s Adam Summers details California’s government spending explosion:

When Gov. Pete Wilson took office in 1991, the state budget was $51.4 billion. When he left eight years later, it was $75.3 billion. After five years of Gov. Davis’s administration, the budget had jumped to $104.2, and after another five years under the stewardship of Gov. Schwarzenegger, it has continued to increase significantly to its present level of $144.5 billion. In just the last 10 years state spending has nearly doubled, increasing approximately 92 percent.

Already California’s leaders are pressing the Obama administration for a federal bailout to cover their massive deficits. Don’t expect spending cuts to be part of any Obama plan to fix the Golden State.

California has failed and middle america gets to bailout the socialists. Obama wants to put the California model on the entire USA. When he does, middle america will not be able to bail out this nonsense. :roll:

The end is near, stockpile weapons and food.