Wednesday, April 7, 2010

Why California Could Be the Next Greece

California has a $500-billion pension time bomb. Who is writing about this?

David Crane special advisor to Gov. Arnold Schwarzenegger.

Government officials are using the crisis situation to scare the public in an attempt to raise taxes. The size of the problem is so huge, however, that a tax solution would really hurt. In an era of a growing Tea Party movement, it is unlikely that such taxes can be imposed. Further, because the debt bomb is tied in with pensions, they are extremely difficult impossible to cut.

Read the Crane piece, here. Despite his positioning of the story as Arnold Schwarzenegger wanting to do the right thing and the California legislature as not co-operating, the facts are accurate. There is no way out. Like Greece , the politicians can't cut for fear of an uprising, and, thankfully, they can't raise tax for fear of an uprising. Thus,default and bankruptcy, or Federal bailout (with controls) is looming.  


  1. Like the citizens of Iceland, its time the citizens of California let the pols and crats know the citizens have no obligation to bail them out of there criminally negligent commitments. Let the uprising begin!

  2. Sink, CA, SINK...........