The Great Recession Has Hit the Government of the City of Los Angeles

The City Council of Los Angeles today announced that it voted to layoff 4,000 employees.

The council vote comes a day after Moody’s issued a negative outlook for the city. Without these cuts, and many more spending cuts not yet determined, the city faces a deficit of $212 million at the start of July. It is not at all clear if the city would be able to borrow such a sum, nor whether sufficient cuts will be made. Thus, bankruptcy does loom very near.