[url]http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/7857595/RBS-tells-clients-to-prepare-for-monster-money-printing-by-the-Federal-Reserve.html[/url]
[QUOTE]The ECRI leading indicator produced by the Economic Cycle Research Institute plummeted yet again last week to -6.9, pointing to contraction in the US by the end of the year. It is dropping faster that at any time in the post-War era.
The latest data from the CPB Netherlands Bureau shows that world trade slid 1.7pc in May, with the biggest fall in Asia. The Baltic Dry Index measuring freight rates on bulk goods has dropped 40pc in a month. This is a volatile index that can be distorted by the supply of new ships, but those who watch it as an early warning signal for China and commodities are nervous.
Andrew Roberts, credit chief at RBS, is advising clients to read the Bernanke text very closely because the Fed is soon going to have to the pull the lever on "monster" quantitative easing (QE)".
[/QUOTE]
Very interesting things going on right now, talking on another board i find this post.
[QUOTE]A collapse in the ECRI (which so many of us economists watch) below -3.5% has predicted a negative GDP print 70% of the time with only two false readings and with a three month lag. A collapse below -10% has been 100% accurate. The rate of change in the decline of the ECRI is picking up..... draw your own conclusions from there.
[/QUOTE]
[QUOTE]The three month lag means that within 3 months of the ECRI turning down by 3.5% (with only two headfakes in the history of the series), the idiots over at the BLS declare that we are in a recession, which means we "have" been in one since their data lags. In other words, within 3 months of the ECRI dropping to -3.5% (which it now stands at a revised -6.9%) the economy is declared to be in a recession (again, with two false readings)...
Now, over 42 years of data, and never being wrong, when the ECRI crosses -10%, you have a recession. 100% of the time. We are now at -6.9% and plummeting.[/QUOTE]
Where is the good news in this mess of a recovery? seriously?
New houses down 32.7 % in may
[url]http://money.cnn.com/2010/06/23/real_estate/new_home_sales/index.htm[/url]
existing home sales down 2 %
[url]http://money.cnn.com/2010/06/22/news/economy/existing_home_sales/index.htm[/url]
excess reserves showing NO lending going on
[IMG]http://research.stlouisfed.org/fred2/data/EXCRESNS_Max_630_378.png[/IMG]
Unemployment benefits cut for 1.2 million people now and 200k each week after.
http://michiganmessenger.com/39113/death-of-unemployment-bill-means-more-state-budget-cuts
On the housing side
All 50 states are reporting year-over-year increases in bank repossessions!
http://www.prescottenews.com/?option=com_content&task=view&id=3621
So whats the problem here? how come all of that money did not kick start the economy and we are not back at before 08 levels again?
It's because the system is dying out, throwing money at the problem is only extending the timeframe of total failure. You dont need a phd in economics to see what is clearly before your unemployed, underemployed or soon to be either one of those, eyes.
Take the time now, to buy what you need to live by your means only, there is plenty of information on the web to help you. If you have kids or someone you love, and think there is a 5% chance of this happening, is that not to much of a chance for you to take some kind of action?
Monday, June 28, 2010
Saturday, June 26, 2010
Is America Destined to Starve?
http://usarmyguyretired.com/wordpress/?p=308
Americans are no longer prepared to take care of their basic needs without the involvement of the federal government. The majority of Americans have relinquished the responsibility of their future survival to bureaucrats. How and when did we, as an intelligent and formerly self-reliant populace, decide to become wards of the state?
Since September 11, 2001 this country has faced numerous disasters both man-made and natural. It is evident after these disasters the majority of the population is unable to fend for themselves without government assistance. In only a matter of days, people run out of food and water, no longer able to take care of their families. They then expect some level of government to open up centers which will provide the necessary sustenance to support their families during these emergencies. Basic needs cannot be met without outside assistance. In less than 60 years Americans have lost the knowledge and will to be self-sufficient. How did this happen?
The federal government, in conjunction with large food suppliers, has seduced the citizens into servitude. The greater part of the population no longer maintains more than seven days of food supply in their homes (paycheck to paycheck). Some may argue this is untrue but it is imperative to be able convert raw foodstuffs into an edible product. If you have basic ingredients but no water, heat source, or electricity those raw foodstuffs might as well be located on another planet. American citizens have succumbed to the lie that everything will be available to them at all times in all circumstances. Americans now spend their money on frivolous goods and services which will not protect them against a possible disaster. If one had the ability to inspect any citizen’s food supply they would be minimal and nutritionally harmful. Food products purchased today are processed to the point of having the actual nutrients degraded in the attempt at extending shelf life. Even Americans themselves seem to have a shelf life after death. A lifetime ingesting foods packed with preservatives and the residuals have significantly altered the very essence of what makes our bodies tick. Americans have fallen into the trap of a never-ending supply of food stuffs from the local grocery store. The just in time inventory system we mimicked from the Japanese has certainly increased efficiency but it has greatly increased risks in food supply if interruptions occur. No one ever questions what happens if that supply suddenly stops or their income ceases to exist.
The example before us today is the oil spill catastrophe in the Gulf of Mexico. This affects a wide swath of wage earners in the gulf region with immense and unpredictable second and third order effects for the rest of the country. The impacted individuals no longer have the capacity to earn a living and limited job prospects, at least in this country. Food lines are now the order of the day in the region. The people now find themselves at the abject mercy of an indifferent, disengaged government bureaucracy only intent on expanding their agenda and the population’s dependency. Listen to the rhetoric from the federal government. Their major concern is not the people or the cleanup, it is how they will extort large sums of money from BP, how they will push forward their Cap and Trade fiasco and how they can take over yet another sector of the economy. The old-school media will cover any usurpation for the current administration in the face of this catastrophe. There will be limited blame placed on some minor bureaucrats with the majority of the fault falling to BP. The assignation of blame is only relevant because the federal government will use this as an opportunity to seize more power and control over business and the lives of the citizens. The economic illiteracy on the part of the government media complex is astounding. If BP is fined, that will have no impact on fuel prices down the line?
Hurricane Katrina and Rita were only small windows into what the country might face in the future. Those natural disasters were limited in scope and therefore did not reach the full consciousness of the American people. Yes, we were quick to blame the political powers for failing to act quickly in response to those disasters, especially if we were diametrically opposed to their agendas. Those disasters pale in scale to what the Gulf Coast now faces in conjunction with a grossly incompetent federal government and complicit media. The lethal combination of incompetence and the ability to have an unlimited scope in meddling is a recipe to make the Greater Depression worse than it is already.
Controlling the food supply has been the plan of the federal government for an extremely long time. The creation of the FDA was fundamental to the execution of this plan. Working in conjunction with large agribusiness and complicit media they now control the destiny of the majority of the population of the United States. They are attempting to eliminate all small farming operations through overbearing regulations and a wink and a nod in the courtroom to patent regulations for the agribusiness lobby. Part of the agenda is to force all small operations to microchip every animal and provide tracking information to the federal government. The large agribusiness operators will not be subject to the same regulations as small farmers. They will be exempt from providing the same information because of the political power they wield through the purchase of politicians.
It is a historical fact that whoever controls the food controls the people. History is replete with examples of what happens when a corrupt and ruthless government controls the food supply. In the 1930’s, Russia starved 10 million Ukrainians to death by stealing all the food produced in their country because they would not support Stalin’s farm collectivization program. Hitler used starvation in Poland for the mass murder of the Jews in the Warsaw ghetto. America is now poised for the same fate since they are unable to feed their families in the face of a disaster or corrupt government.
There are many reasons the food supply might cease functioning in United States. Natural or man-made disasters are the preeminent possibilities which might precipitate a food stoppage. We do not want to contemplate the stoppage may be due the interference of the federal government. The question that must be asked is how we survive as a people in the event of a long-term interruption of the food supply? The majority of the population no longer has any understanding of raising their own food supply. No longer are we capable of going to our seed supply and planting a survival garden. If a family does have seed, it is imperative to ask a question. Is the seed the heirloom variety or the genetically altered large agribusiness strain? If it is the genetically altered variety then it is part of the trap and that family will starve. Genetically altered seeds render them viable for one season with no ability to harvest seed for future planting. The unprepared with no stockpile of heirloom seeds will be at the mercy of the government or whoever holds the power.
The stoppage of the food supply is only an example of what might transpire in the event of a disaster. We, as a people, are an unprepared population. There are many books written concerning what this country might face in a disaster which also address the impact of a massive economic or social collapse of the government. I urge everyone to read these tomes and educate themselves as to what might transpire and to better prepare for the unspeakable but inevitable future. It is incumbent upon each family to prepare themselves for the coming crisis our country will eventually have to endure. It is naïve at best and foolish at worst to believe our country is too big to fail. The preparation of an informed populace will define how we survive as a people in the event of a major disaster or economic collapse.
Are you ready, or will your family starve?
Americans are no longer prepared to take care of their basic needs without the involvement of the federal government. The majority of Americans have relinquished the responsibility of their future survival to bureaucrats. How and when did we, as an intelligent and formerly self-reliant populace, decide to become wards of the state?
Since September 11, 2001 this country has faced numerous disasters both man-made and natural. It is evident after these disasters the majority of the population is unable to fend for themselves without government assistance. In only a matter of days, people run out of food and water, no longer able to take care of their families. They then expect some level of government to open up centers which will provide the necessary sustenance to support their families during these emergencies. Basic needs cannot be met without outside assistance. In less than 60 years Americans have lost the knowledge and will to be self-sufficient. How did this happen?
The federal government, in conjunction with large food suppliers, has seduced the citizens into servitude. The greater part of the population no longer maintains more than seven days of food supply in their homes (paycheck to paycheck). Some may argue this is untrue but it is imperative to be able convert raw foodstuffs into an edible product. If you have basic ingredients but no water, heat source, or electricity those raw foodstuffs might as well be located on another planet. American citizens have succumbed to the lie that everything will be available to them at all times in all circumstances. Americans now spend their money on frivolous goods and services which will not protect them against a possible disaster. If one had the ability to inspect any citizen’s food supply they would be minimal and nutritionally harmful. Food products purchased today are processed to the point of having the actual nutrients degraded in the attempt at extending shelf life. Even Americans themselves seem to have a shelf life after death. A lifetime ingesting foods packed with preservatives and the residuals have significantly altered the very essence of what makes our bodies tick. Americans have fallen into the trap of a never-ending supply of food stuffs from the local grocery store. The just in time inventory system we mimicked from the Japanese has certainly increased efficiency but it has greatly increased risks in food supply if interruptions occur. No one ever questions what happens if that supply suddenly stops or their income ceases to exist.
The example before us today is the oil spill catastrophe in the Gulf of Mexico. This affects a wide swath of wage earners in the gulf region with immense and unpredictable second and third order effects for the rest of the country. The impacted individuals no longer have the capacity to earn a living and limited job prospects, at least in this country. Food lines are now the order of the day in the region. The people now find themselves at the abject mercy of an indifferent, disengaged government bureaucracy only intent on expanding their agenda and the population’s dependency. Listen to the rhetoric from the federal government. Their major concern is not the people or the cleanup, it is how they will extort large sums of money from BP, how they will push forward their Cap and Trade fiasco and how they can take over yet another sector of the economy. The old-school media will cover any usurpation for the current administration in the face of this catastrophe. There will be limited blame placed on some minor bureaucrats with the majority of the fault falling to BP. The assignation of blame is only relevant because the federal government will use this as an opportunity to seize more power and control over business and the lives of the citizens. The economic illiteracy on the part of the government media complex is astounding. If BP is fined, that will have no impact on fuel prices down the line?
Hurricane Katrina and Rita were only small windows into what the country might face in the future. Those natural disasters were limited in scope and therefore did not reach the full consciousness of the American people. Yes, we were quick to blame the political powers for failing to act quickly in response to those disasters, especially if we were diametrically opposed to their agendas. Those disasters pale in scale to what the Gulf Coast now faces in conjunction with a grossly incompetent federal government and complicit media. The lethal combination of incompetence and the ability to have an unlimited scope in meddling is a recipe to make the Greater Depression worse than it is already.
Controlling the food supply has been the plan of the federal government for an extremely long time. The creation of the FDA was fundamental to the execution of this plan. Working in conjunction with large agribusiness and complicit media they now control the destiny of the majority of the population of the United States. They are attempting to eliminate all small farming operations through overbearing regulations and a wink and a nod in the courtroom to patent regulations for the agribusiness lobby. Part of the agenda is to force all small operations to microchip every animal and provide tracking information to the federal government. The large agribusiness operators will not be subject to the same regulations as small farmers. They will be exempt from providing the same information because of the political power they wield through the purchase of politicians.
It is a historical fact that whoever controls the food controls the people. History is replete with examples of what happens when a corrupt and ruthless government controls the food supply. In the 1930’s, Russia starved 10 million Ukrainians to death by stealing all the food produced in their country because they would not support Stalin’s farm collectivization program. Hitler used starvation in Poland for the mass murder of the Jews in the Warsaw ghetto. America is now poised for the same fate since they are unable to feed their families in the face of a disaster or corrupt government.
There are many reasons the food supply might cease functioning in United States. Natural or man-made disasters are the preeminent possibilities which might precipitate a food stoppage. We do not want to contemplate the stoppage may be due the interference of the federal government. The question that must be asked is how we survive as a people in the event of a long-term interruption of the food supply? The majority of the population no longer has any understanding of raising their own food supply. No longer are we capable of going to our seed supply and planting a survival garden. If a family does have seed, it is imperative to ask a question. Is the seed the heirloom variety or the genetically altered large agribusiness strain? If it is the genetically altered variety then it is part of the trap and that family will starve. Genetically altered seeds render them viable for one season with no ability to harvest seed for future planting. The unprepared with no stockpile of heirloom seeds will be at the mercy of the government or whoever holds the power.
The stoppage of the food supply is only an example of what might transpire in the event of a disaster. We, as a people, are an unprepared population. There are many books written concerning what this country might face in a disaster which also address the impact of a massive economic or social collapse of the government. I urge everyone to read these tomes and educate themselves as to what might transpire and to better prepare for the unspeakable but inevitable future. It is incumbent upon each family to prepare themselves for the coming crisis our country will eventually have to endure. It is naïve at best and foolish at worst to believe our country is too big to fail. The preparation of an informed populace will define how we survive as a people in the event of a major disaster or economic collapse.
Are you ready, or will your family starve?
Wednesday, June 23, 2010
Guess What America? Your Cities And States Are Flat Broke
http://endoftheamericandream.com/archives/guess-what-america-your-cities-and-states-are-flat-broke
Now that the economic boom times of the earlier part of the decade are over, cities and states across America are going bust. In fact, for a growing number of local governments throughout the United States, there is no getting around the fact that "flat broke" accurately describes the situation that they are facing. For many of these cities and states that are on the verge of bankruptcy, the American Dream is quickly turning into the American Nightmare.
Unlike the federal government, which can ask the Federal Reserve to print up some more money when they get into trouble, state and local governments have nowhere to go when the well runs dry. They either have to raise taxes or cut spending. But in many areas of the country, services have already been cut to the bone and people are already being taxed into oblivion. So what can be done? Well, many of these state and local governments are just going to have to cut spending even deeper, squeeze even more taxes out of their residents, or go to the federal government for a handout.
America Your Cities Are Broke
Once upon a time, municipal bonds (used to fund such things as roads, sewer systems and government buildings) were viewed as one of the very safest of investments.
But now all of that is changing.
According to Distressed Debt Securities, in 2009 183 municipal borrowers were unable to make $6.4 billion in loan payments.
Just two years earlier, those numbers were 31 and $348 million.
As you can see, that is not a good trend.
The truth is that municipal governments are facing an unprecedented fiscal crisis.
In fact, the National League of Cities recently announced that municipal governments will collectively come up somewhere between $56 billion and $83 billion short between now and 2012.
So where will all of that money come from?
It will have to come from spending cuts, tax hikes or handouts from the federal government.
Or, if something is not done, we are going to see a massive wave of municipal defaults.
Case Study: Detroit
The situation is particularly dire in areas that have been hit hardest by the economic crisis.
To make up for a projected 2010 budget shortfall of 280 million dollars, the city of Detroit issued 20-year municipal notes totalling 250 million dollars in March. But there is a real question as to whether or not Detroit is actually going to be able to meet these obligations. In fact, Detroit officials are openly admitting that if the financial state of the city does not rapidly improve, it could be forced to declare bankruptcy.
What a sad state of affairs for what was once one of America's greatest cities.
During the economic boom times of the 1950s, Detroit was a thriving metropolis of approximately 2 million people.
Today, the current population is less than half that and people are leaving in droves.
But even the people who are still there can't get jobs. The mayor of Detroit says that while the "official" rate of unemployment in Detroit is 27 percent, the "real" unemployment rate in his city is somewhere in the neighborhood of 50 percent.
But at least houses are cheap.
In Detroit, it is not uncommon to see homes advertised for under $1000, and in fact there are some houses in the city that you can actually purchase for just one dollar.
Not that you would want to live in those homes.
Violent crime is dramatically increasing in Detroit and vandals have been running around stripping everything of value off of many of the homes.
So what is Detroit doing about this crisis?
Well, they have decided to downsize.
Emergency Financial Manager Robert Bobb recently announced a plan to close 44 Detroit schools.
Also, Mayor Bing has promised to bulldoze 3,000 Detroit homes this year, and an additional 7,000 over the following three years.
But that will only make a dent in the urban blight. According to one estimate, the city of Detroit has 33,500 empty houses and 91,000 vacant residential lots.
So if you are looking for some really cheap housing you might want to consider moving to Detroit.
Just don't count on getting a job.
America Your States Are Broke
But it is not just local governments that are broke. Entire U.S. states are on the verge of bankruptcy.
In fact, a large number of U.S. states are preparing for their biggest budget cuts in decades.
An article in CNN recently put it this way....
"Think states have made deep spending cuts? You ain't seen nothing yet."
In 2008 and 2009, economic stimulus money helped many states make it through the financial crisis, but now that money is drying up and many states do not know what they are going to do.
Already, half a dozen cash-poor U.S. states have announced that they are delaying their tax refund checks.
That would have been unthinkable a couple of decades ago, but these are desperate times.
In fact, New York state has delayed paying bills totalling $2.5 billion as a short-term way of staying solvent.
But those bills have got to be paid some time.
So what has caused this huge financial mess?
Debt.
Just like the U.S. federal government, state governments have gotten themselves into reckless amounts of debt, and now the day of reckoning is here.
And things are going to get a lot worse.
According to EconomicPolicyJournal.com, 32 U.S. states have already run out of funds to make unemployment benefit payments and so the federal government has been supplying these states with funds so that they can make their payments to the unemployed.
So what happens when the U.S. government says that it wants to stop making those payments for the states?
But the pension crisis on the state level is something that is far more alarming.
Two university professors recently calculated that the combined unfunded pension liability for all 50 U.S. states is 3.2 trillion dollars.
Yes, you read that right.
3.2 trillion dollars.
So where will that 3.2 trillion dollars come from?
Nobody really knows.
Case Study: California
Many states are in massive financial trouble, but California is perhaps in the worst condition of all.
The economic crisis has hit the "golden state" particularly hard.
Businesses are shutting down at a stunning rate. In the area around Sacramento, California there is now one closed business for every six that are still open.
Unemployment in California is absolutely exploding. There are now 8 counties in the state of California that now have unemployment rates of over 20 percent.
In fact, the number of people now unemployed in the state of California is equal to the populations of Nevada, New Hampshire and Vermont combined.
The truth is that in this economic environment, not even teachers are safe. Just recently, the state of California handed pink slips to nearly 22,000 teachers across the state.
Can you imagine firing 22,000 teachers?
But canning all of those hard working teachers barely even made a dent in California's budget problems.
California Governor Arnold Schwarzenegger is promising to seek "terrible cuts" in an effort to bring the exploding debt of the government of California under control, but the truth is that it is hard to squeeze blood out of a rock.
Bob Herbert of the New York Times recently described California's horrific budget crisis this way....
California has cut billions of dollars from its education system, including its renowned network of public colleges and universities. Many thousands of teachers have been let go. Budget officials travel the state with a glazed look in their eyes, having tried everything they can think of to balance the state budget. And still the deficits persist.
The truth is that California is bankrupt. They can try to keep borrowing more money as fast as they can in an effort to push their problems off to another day, but in the end California is going to go belly up.
But the same thing could be said for the entire U.S. economy. The total government, corporate and consumer debt of the United States has now reached 360 percent of GDP and is accelerating. We have reached a point where there is simply no way out. The only thing that can even delay the inevitable is to borrow even more money and to try to crank the debt spiral up one more time.
We have created an economic nightmare of epic proportions, and we have wrecked the future for our children and our grandchildren.
What a mess.
Now that the economic boom times of the earlier part of the decade are over, cities and states across America are going bust. In fact, for a growing number of local governments throughout the United States, there is no getting around the fact that "flat broke" accurately describes the situation that they are facing. For many of these cities and states that are on the verge of bankruptcy, the American Dream is quickly turning into the American Nightmare.
Unlike the federal government, which can ask the Federal Reserve to print up some more money when they get into trouble, state and local governments have nowhere to go when the well runs dry. They either have to raise taxes or cut spending. But in many areas of the country, services have already been cut to the bone and people are already being taxed into oblivion. So what can be done? Well, many of these state and local governments are just going to have to cut spending even deeper, squeeze even more taxes out of their residents, or go to the federal government for a handout.
America Your Cities Are Broke
Once upon a time, municipal bonds (used to fund such things as roads, sewer systems and government buildings) were viewed as one of the very safest of investments.
But now all of that is changing.
According to Distressed Debt Securities, in 2009 183 municipal borrowers were unable to make $6.4 billion in loan payments.
Just two years earlier, those numbers were 31 and $348 million.
As you can see, that is not a good trend.
The truth is that municipal governments are facing an unprecedented fiscal crisis.
In fact, the National League of Cities recently announced that municipal governments will collectively come up somewhere between $56 billion and $83 billion short between now and 2012.
So where will all of that money come from?
It will have to come from spending cuts, tax hikes or handouts from the federal government.
Or, if something is not done, we are going to see a massive wave of municipal defaults.
Case Study: Detroit
The situation is particularly dire in areas that have been hit hardest by the economic crisis.
To make up for a projected 2010 budget shortfall of 280 million dollars, the city of Detroit issued 20-year municipal notes totalling 250 million dollars in March. But there is a real question as to whether or not Detroit is actually going to be able to meet these obligations. In fact, Detroit officials are openly admitting that if the financial state of the city does not rapidly improve, it could be forced to declare bankruptcy.
What a sad state of affairs for what was once one of America's greatest cities.
During the economic boom times of the 1950s, Detroit was a thriving metropolis of approximately 2 million people.
Today, the current population is less than half that and people are leaving in droves.
But even the people who are still there can't get jobs. The mayor of Detroit says that while the "official" rate of unemployment in Detroit is 27 percent, the "real" unemployment rate in his city is somewhere in the neighborhood of 50 percent.
But at least houses are cheap.
In Detroit, it is not uncommon to see homes advertised for under $1000, and in fact there are some houses in the city that you can actually purchase for just one dollar.
Not that you would want to live in those homes.
Violent crime is dramatically increasing in Detroit and vandals have been running around stripping everything of value off of many of the homes.
So what is Detroit doing about this crisis?
Well, they have decided to downsize.
Emergency Financial Manager Robert Bobb recently announced a plan to close 44 Detroit schools.
Also, Mayor Bing has promised to bulldoze 3,000 Detroit homes this year, and an additional 7,000 over the following three years.
But that will only make a dent in the urban blight. According to one estimate, the city of Detroit has 33,500 empty houses and 91,000 vacant residential lots.
So if you are looking for some really cheap housing you might want to consider moving to Detroit.
Just don't count on getting a job.
America Your States Are Broke
But it is not just local governments that are broke. Entire U.S. states are on the verge of bankruptcy.
In fact, a large number of U.S. states are preparing for their biggest budget cuts in decades.
An article in CNN recently put it this way....
"Think states have made deep spending cuts? You ain't seen nothing yet."
In 2008 and 2009, economic stimulus money helped many states make it through the financial crisis, but now that money is drying up and many states do not know what they are going to do.
Already, half a dozen cash-poor U.S. states have announced that they are delaying their tax refund checks.
That would have been unthinkable a couple of decades ago, but these are desperate times.
In fact, New York state has delayed paying bills totalling $2.5 billion as a short-term way of staying solvent.
But those bills have got to be paid some time.
So what has caused this huge financial mess?
Debt.
Just like the U.S. federal government, state governments have gotten themselves into reckless amounts of debt, and now the day of reckoning is here.
And things are going to get a lot worse.
According to EconomicPolicyJournal.com, 32 U.S. states have already run out of funds to make unemployment benefit payments and so the federal government has been supplying these states with funds so that they can make their payments to the unemployed.
So what happens when the U.S. government says that it wants to stop making those payments for the states?
But the pension crisis on the state level is something that is far more alarming.
Two university professors recently calculated that the combined unfunded pension liability for all 50 U.S. states is 3.2 trillion dollars.
Yes, you read that right.
3.2 trillion dollars.
So where will that 3.2 trillion dollars come from?
Nobody really knows.
Case Study: California
Many states are in massive financial trouble, but California is perhaps in the worst condition of all.
The economic crisis has hit the "golden state" particularly hard.
Businesses are shutting down at a stunning rate. In the area around Sacramento, California there is now one closed business for every six that are still open.
Unemployment in California is absolutely exploding. There are now 8 counties in the state of California that now have unemployment rates of over 20 percent.
In fact, the number of people now unemployed in the state of California is equal to the populations of Nevada, New Hampshire and Vermont combined.
The truth is that in this economic environment, not even teachers are safe. Just recently, the state of California handed pink slips to nearly 22,000 teachers across the state.
Can you imagine firing 22,000 teachers?
But canning all of those hard working teachers barely even made a dent in California's budget problems.
California Governor Arnold Schwarzenegger is promising to seek "terrible cuts" in an effort to bring the exploding debt of the government of California under control, but the truth is that it is hard to squeeze blood out of a rock.
Bob Herbert of the New York Times recently described California's horrific budget crisis this way....
California has cut billions of dollars from its education system, including its renowned network of public colleges and universities. Many thousands of teachers have been let go. Budget officials travel the state with a glazed look in their eyes, having tried everything they can think of to balance the state budget. And still the deficits persist.
The truth is that California is bankrupt. They can try to keep borrowing more money as fast as they can in an effort to push their problems off to another day, but in the end California is going to go belly up.
But the same thing could be said for the entire U.S. economy. The total government, corporate and consumer debt of the United States has now reached 360 percent of GDP and is accelerating. We have reached a point where there is simply no way out. The only thing that can even delay the inevitable is to borrow even more money and to try to crank the debt spiral up one more time.
We have created an economic nightmare of epic proportions, and we have wrecked the future for our children and our grandchildren.
What a mess.
State Budgets: Serious, Ridiculous, Ugly
by John Rubino on June 23, 2010
This week the focus shifted from Europe, where (apart from the French World Cup team) things are quiet, to the US, where state budget deadlines are forcing some tough, and occasionally bizarre, choices. Time Magazine’s cover, for instance blares “The Broken States of America”. An excerpt:
… Almost no one — and no place — is exempt. Nearly everywhere, tax revenue plummeted as property values tanked, incomes dwindled and consumers stopped shopping. Falling prices for stocks and real estate have made mincemeat of often underfunded public pension plans. Unemployed workers have swelled the demand for welfare and Medicaid services. Governments that were frugal in the past are just squeaking by. Governments that were lavish in the good times, building their budgets on optimism and best-case scenarios, now risk being wrecked like a shantytown in an earthquake.
How the Money Ran Out
For the first time in four decades of collecting data, the National Governors Association (NGA) reports that total state spending has dropped for two years in a row. In hard-hit Arizona, for example, the state budget has sagged to 2004 levels, despite blistering growth in population and demand for government services. Starting with the 2008 fiscal year, state governments have closed more than $300 billion in cumulative budget gaps, with another $125 billion already projected for the coming years, says Corina Eckl, fiscal-program director at the National Conference of State Legislatures (NCSL). Similar figures aren’t collected for the nation’s counties, villages and towns, but when the National League of Cities surveyed mayors recently, three-fourths of them described worsening economic conditions.
Accustomed to the ups and downs of the ordinary economic cycle, elected officials and budget planners are facing something none of them have experienced before: year after year of shortfalls, steadily compounding. Ordinarily, deficits are resolved mostly through budgetary hocus-pocus. But the length and depth of the recession are forcing governments to go beyond sleight of hand to genuine cuts. And that makes lawmakers gloomy in all but a handful of states. (It’s a swell time to be North Dakota.) According to an NCSL survey, worry or outright pessimism is the reigning mood in the vast majority of capitals.
And here’s a brief look at how some states are dealing with their deficits, starting with California:
A three-way stalemate over California’s budget
Budget, budget, who’s got a budget?
The governor has a state budget that his fellow Republicans more or less support. Assembly Democrats have a budget whose centerpiece is a complex scheme to borrow billions of dollars. And Democratic senators have a budget that’s based on raising taxes and shifting some programs from the state to counties.
Democrats control the 10-member, two-house conference committee that’s supposed to be reconciling all three budgets into one version that would be placed before the entire Legislature. They have the votes to do it. However, the committee has been going through the budget page by page for more than two weeks without settling any big issues and only some little ones. It’s now in hiatus after repeatedly hitting a political wall, unable to proceed because it doesn’t know how much money it has to spend.
That’s because the two Democratic versions of the budget are very much at odds, even if they both agree on rejecting Gov. Arnold Schwarzenegger’s slash-and-burn approach to closing a $19.1 billion deficit. It’s a three-way stalemate, with the new fiscal year due to begin next week and with state Controller John Chiang warning that the state will run out of cash this summer if a new budget is not in place.
Nothing will happen until Democrats in both houses are in sync on whether to borrow or tax their way out of this year’s version of the chronic deficit. But even if they do – and they appear to be very far apart – it would be merely a step, and not a particularly big one, on the budget road. They could put a budget up for floor votes, but they would still need to get some votes from Republicans, who have said anything that depends on higher taxes, or even extending some temporary taxes due to expire next year, is dead on arrival.
California budget idea: Ads on e-license plates
California’s legislature is exploring the feasibility of electronic license plates with digital ads, a move that its leading proponent says could add jobs and help in combating the state’s budget crisis.
Sen. Curren Price, a Democrat from the Los Angeles area, said the technology will resemble traditional license plates, with plate numbers visible at all times. However, digital ads and public service announcements would flash on the plate’s screen when the vehicle is stopped for more than a few seconds.
The technology could provide an additional source of revenue for the cash-strapped state, according to Price, the bill’s author, as advertisers and technology companies contract with the Department of Motor Vehicles. He said the plates could also aid small businesses and add jobs to the ailing economy in the technology, sales and marketing, and service industries.
“State governments are facing unprecedented budget shortfalls, and are actively rethinking the use of existing state assets to create new ongoing revenue opportunities,” he said. “This is a unique opportunity for public-private partnership.”
However, Price said he doesn’t know how much revenue electronic license plates would generate, or how many jobs they would create. California’s budget deficit is an estimated $19.1 billion.
New York:
Cigarette Tax Increased to Keep State Running
New Yorkers who like to smoke will have to dig a little deeper to light up next month, after the Legislature passed a bill on Monday that will give the state the highest cigarette taxes in the country. The new law, part of an emergency budget measure to keep the government running, adds another $1.60 in state taxes to every cigarette pack sold starting on July 1, pushing the average price of a pack to about $9.20. The average price in New York City, which imposes its own cigarette taxes, will be even higher, nearly $11 a pack.
Those who prefer other tobacco products will also be forced to pay significantly more. The tax on smokeless tobacco will more than double, to $2 an ounce from 96 cents an ounce, starting on Aug. 1. And the wholesale tax on cigars, dips and other kinds of tobacco will rise to 75 percent from 46 percent .
And in what may be the legislation’s most controversial provisions, starting on Sept. 1, the state will begin collecting — or try to collect — taxes on cigarettes sold on Indian reservations to off-reservation visitors, an issue that led to violent protests during the early 1990s. One Indian chief has said that trying to collect taxes would be considered an act of war.
Massachusetts:
Hill eyes another savings draw to blunt cuts if no federal funds
BOSTON — Girding for the start next week of a new fiscal year amid growing uncertainty about nearly $700 million in federal aid, legislative budget writers tentatively plan to withdraw $100 million from the state’s atrophying main savings account while refraining from deeper reductions in aid to cities and towns.
Gov. Deval Patrick and legislative leaders met Monday and discussed Beacon Hill’s narrowing menu of options for coping with Washington’s reluctance to authorize Medicaid funds that the administration, House and Senate all banked on for fiscal 2011. House budget chief Charles Murphy said the budget intended for the floor this week would contain two sets of line items, one in case the funds do not arrive and one if they do.
State lawmakers acknowledged not having much insight into Congress’s plans for the money, part of a $24 billion package that has received backing at one time or another from both legislative branches and the White House. “Frankly, they’ve recessed until this week sometime, so nobody knows,” Murphy said.
“We haven’t given up on it,” Patrick told reporters Monday. “I don’t think we should give up on it, given the fact that both the U.S. House and the U.S. Senate have voted on it. But if we don’t have it in hand by the time of the fiscal year, then we should have a budget that doesn’t account for it.” The Senate accounted for $687 million in additional federal assistance, while both Patrick and the House used $79 million less. In filing a contingency budget last week, Patrick, who has taken heat from his gubernatorial rivals for his budgeting practices, proposed holding harmless state support for local aid and public schools.
Colorado:
More state budget cuts likely, officials forecast
Colorado is looking over the edge of a $1 billion budget abyss, with key services, from schools to health care for the needy, on the chopping block next year. In a clear sign that economic recovery is not keeping pace with demand for governments services, economic forecasters warned a General Assembly budget committee on Monday that the state fiscal picture has worsened in the past three months and could be darker still in a year.
Economic forecasts prepared by the Governor’s office and by advisers to the General Assembly backed away from optimism seen earlier this year. They outlined a $1 billion crisis for the budget year that begins July 1, 2011.State revenue fell from a March economic forecast by more than $120 million, largely because tax collectors are having a difficult time getting people and businesses to pay up. That cuts into the state’s savings account, leaving Gov. Bill Ritter to come up with as much as $75 million in immediate cuts from the state’s $7 billion general fund.
On Monday, Gov. Bill Ritter said he is scouring the budget to cover the shortfall, with a plan due by August. He covered bigger shortfalls last year by furloughing state workers, cutting programs and releasing some inmates from state prisons. Ritter said that in the past two years he’s done his best to preserve essential state services while closing budget gaps totaling $3.5 billion. “As you go forward it becomes increasingly difficult to find ways to do that,” he said.
Colorado Springs Democratic Sen. John Morse has been predicting deeper budget cuts for months.
“Colorado is recovering, but, as predicted, it will be a slow and long recovery,” he said Monday. “While more cuts are inevitable, we, as legislators, must do what we can to make those cuts as painless as possible.”
New Jersey:
Budget compromise reached in N.J.
New Jersey Gov. Chris Christie and lawmakers reached a compromise on a $29.38 billion state budget Monday, which is scheduled for final votes on Monday.
The budget will make funds available for approved, shovel-ready Urban Enterprise Zone projects and uses $74 million in additional cost-savings to restore funding for several programs, including $22 million for general assistance. The budget plan, which closes a $11 billion deficit, will leave a more than $300 million surplus, Christie said.
“This budget stays true to the principles I originally outlined, keeping spending within our means and restoring fiscal order without raising taxes,” Christie said.
The state’s budget is due by June 30, a deadline Senate President Stephen M. Sweeney, D-Gloucester/Cumberland/Salem, said would be met.
“The budget we will introduce is far from perfect and will still be a tough sell among Democratic lawmakers, but the governor should be commended for working with us to take the sting our of some of its most harmful cuts,” Sweeney said of the budget compromise reached with Christie. “Most importantly, this budget will be signed on time, and all the rumors of a shutdown will remain just that.”
Some thoughts:
It’s clear who is serious and who isn’t. New York raises cigarette prices to 11 bucks a pack, and expects higher revenues rather than increased smuggling and a more powerful mafia. Massachusetts spends its savings while hoping for a federal bailout. And let’s not even bother with California. At the other end of the spectrum are Colorado and New Jersey, where real cuts will bring budgets closer to real balance.
It’s also clear that sometime in the next year or two, the worst-run states will balk at laying off half their workers and will choose instead to default on their debt, presenting Washington with the same choice as with the banks in 2008: bailouts or contagion.
Even where states make real cuts in spending, the resulting economic contractions will be brutal.
Muni bonds, which are funded by sport stadiums and the like — or by state/city general revenues — are the next sector to blow up.
This week the focus shifted from Europe, where (apart from the French World Cup team) things are quiet, to the US, where state budget deadlines are forcing some tough, and occasionally bizarre, choices. Time Magazine’s cover, for instance blares “The Broken States of America”. An excerpt:
… Almost no one — and no place — is exempt. Nearly everywhere, tax revenue plummeted as property values tanked, incomes dwindled and consumers stopped shopping. Falling prices for stocks and real estate have made mincemeat of often underfunded public pension plans. Unemployed workers have swelled the demand for welfare and Medicaid services. Governments that were frugal in the past are just squeaking by. Governments that were lavish in the good times, building their budgets on optimism and best-case scenarios, now risk being wrecked like a shantytown in an earthquake.
How the Money Ran Out
For the first time in four decades of collecting data, the National Governors Association (NGA) reports that total state spending has dropped for two years in a row. In hard-hit Arizona, for example, the state budget has sagged to 2004 levels, despite blistering growth in population and demand for government services. Starting with the 2008 fiscal year, state governments have closed more than $300 billion in cumulative budget gaps, with another $125 billion already projected for the coming years, says Corina Eckl, fiscal-program director at the National Conference of State Legislatures (NCSL). Similar figures aren’t collected for the nation’s counties, villages and towns, but when the National League of Cities surveyed mayors recently, three-fourths of them described worsening economic conditions.
Accustomed to the ups and downs of the ordinary economic cycle, elected officials and budget planners are facing something none of them have experienced before: year after year of shortfalls, steadily compounding. Ordinarily, deficits are resolved mostly through budgetary hocus-pocus. But the length and depth of the recession are forcing governments to go beyond sleight of hand to genuine cuts. And that makes lawmakers gloomy in all but a handful of states. (It’s a swell time to be North Dakota.) According to an NCSL survey, worry or outright pessimism is the reigning mood in the vast majority of capitals.
And here’s a brief look at how some states are dealing with their deficits, starting with California:
A three-way stalemate over California’s budget
Budget, budget, who’s got a budget?
The governor has a state budget that his fellow Republicans more or less support. Assembly Democrats have a budget whose centerpiece is a complex scheme to borrow billions of dollars. And Democratic senators have a budget that’s based on raising taxes and shifting some programs from the state to counties.
Democrats control the 10-member, two-house conference committee that’s supposed to be reconciling all three budgets into one version that would be placed before the entire Legislature. They have the votes to do it. However, the committee has been going through the budget page by page for more than two weeks without settling any big issues and only some little ones. It’s now in hiatus after repeatedly hitting a political wall, unable to proceed because it doesn’t know how much money it has to spend.
That’s because the two Democratic versions of the budget are very much at odds, even if they both agree on rejecting Gov. Arnold Schwarzenegger’s slash-and-burn approach to closing a $19.1 billion deficit. It’s a three-way stalemate, with the new fiscal year due to begin next week and with state Controller John Chiang warning that the state will run out of cash this summer if a new budget is not in place.
Nothing will happen until Democrats in both houses are in sync on whether to borrow or tax their way out of this year’s version of the chronic deficit. But even if they do – and they appear to be very far apart – it would be merely a step, and not a particularly big one, on the budget road. They could put a budget up for floor votes, but they would still need to get some votes from Republicans, who have said anything that depends on higher taxes, or even extending some temporary taxes due to expire next year, is dead on arrival.
California budget idea: Ads on e-license plates
California’s legislature is exploring the feasibility of electronic license plates with digital ads, a move that its leading proponent says could add jobs and help in combating the state’s budget crisis.
Sen. Curren Price, a Democrat from the Los Angeles area, said the technology will resemble traditional license plates, with plate numbers visible at all times. However, digital ads and public service announcements would flash on the plate’s screen when the vehicle is stopped for more than a few seconds.
The technology could provide an additional source of revenue for the cash-strapped state, according to Price, the bill’s author, as advertisers and technology companies contract with the Department of Motor Vehicles. He said the plates could also aid small businesses and add jobs to the ailing economy in the technology, sales and marketing, and service industries.
“State governments are facing unprecedented budget shortfalls, and are actively rethinking the use of existing state assets to create new ongoing revenue opportunities,” he said. “This is a unique opportunity for public-private partnership.”
However, Price said he doesn’t know how much revenue electronic license plates would generate, or how many jobs they would create. California’s budget deficit is an estimated $19.1 billion.
New York:
Cigarette Tax Increased to Keep State Running
New Yorkers who like to smoke will have to dig a little deeper to light up next month, after the Legislature passed a bill on Monday that will give the state the highest cigarette taxes in the country. The new law, part of an emergency budget measure to keep the government running, adds another $1.60 in state taxes to every cigarette pack sold starting on July 1, pushing the average price of a pack to about $9.20. The average price in New York City, which imposes its own cigarette taxes, will be even higher, nearly $11 a pack.
Those who prefer other tobacco products will also be forced to pay significantly more. The tax on smokeless tobacco will more than double, to $2 an ounce from 96 cents an ounce, starting on Aug. 1. And the wholesale tax on cigars, dips and other kinds of tobacco will rise to 75 percent from 46 percent .
And in what may be the legislation’s most controversial provisions, starting on Sept. 1, the state will begin collecting — or try to collect — taxes on cigarettes sold on Indian reservations to off-reservation visitors, an issue that led to violent protests during the early 1990s. One Indian chief has said that trying to collect taxes would be considered an act of war.
Massachusetts:
Hill eyes another savings draw to blunt cuts if no federal funds
BOSTON — Girding for the start next week of a new fiscal year amid growing uncertainty about nearly $700 million in federal aid, legislative budget writers tentatively plan to withdraw $100 million from the state’s atrophying main savings account while refraining from deeper reductions in aid to cities and towns.
Gov. Deval Patrick and legislative leaders met Monday and discussed Beacon Hill’s narrowing menu of options for coping with Washington’s reluctance to authorize Medicaid funds that the administration, House and Senate all banked on for fiscal 2011. House budget chief Charles Murphy said the budget intended for the floor this week would contain two sets of line items, one in case the funds do not arrive and one if they do.
State lawmakers acknowledged not having much insight into Congress’s plans for the money, part of a $24 billion package that has received backing at one time or another from both legislative branches and the White House. “Frankly, they’ve recessed until this week sometime, so nobody knows,” Murphy said.
“We haven’t given up on it,” Patrick told reporters Monday. “I don’t think we should give up on it, given the fact that both the U.S. House and the U.S. Senate have voted on it. But if we don’t have it in hand by the time of the fiscal year, then we should have a budget that doesn’t account for it.” The Senate accounted for $687 million in additional federal assistance, while both Patrick and the House used $79 million less. In filing a contingency budget last week, Patrick, who has taken heat from his gubernatorial rivals for his budgeting practices, proposed holding harmless state support for local aid and public schools.
Colorado:
More state budget cuts likely, officials forecast
Colorado is looking over the edge of a $1 billion budget abyss, with key services, from schools to health care for the needy, on the chopping block next year. In a clear sign that economic recovery is not keeping pace with demand for governments services, economic forecasters warned a General Assembly budget committee on Monday that the state fiscal picture has worsened in the past three months and could be darker still in a year.
Economic forecasts prepared by the Governor’s office and by advisers to the General Assembly backed away from optimism seen earlier this year. They outlined a $1 billion crisis for the budget year that begins July 1, 2011.State revenue fell from a March economic forecast by more than $120 million, largely because tax collectors are having a difficult time getting people and businesses to pay up. That cuts into the state’s savings account, leaving Gov. Bill Ritter to come up with as much as $75 million in immediate cuts from the state’s $7 billion general fund.
On Monday, Gov. Bill Ritter said he is scouring the budget to cover the shortfall, with a plan due by August. He covered bigger shortfalls last year by furloughing state workers, cutting programs and releasing some inmates from state prisons. Ritter said that in the past two years he’s done his best to preserve essential state services while closing budget gaps totaling $3.5 billion. “As you go forward it becomes increasingly difficult to find ways to do that,” he said.
Colorado Springs Democratic Sen. John Morse has been predicting deeper budget cuts for months.
“Colorado is recovering, but, as predicted, it will be a slow and long recovery,” he said Monday. “While more cuts are inevitable, we, as legislators, must do what we can to make those cuts as painless as possible.”
New Jersey:
Budget compromise reached in N.J.
New Jersey Gov. Chris Christie and lawmakers reached a compromise on a $29.38 billion state budget Monday, which is scheduled for final votes on Monday.
The budget will make funds available for approved, shovel-ready Urban Enterprise Zone projects and uses $74 million in additional cost-savings to restore funding for several programs, including $22 million for general assistance. The budget plan, which closes a $11 billion deficit, will leave a more than $300 million surplus, Christie said.
“This budget stays true to the principles I originally outlined, keeping spending within our means and restoring fiscal order without raising taxes,” Christie said.
The state’s budget is due by June 30, a deadline Senate President Stephen M. Sweeney, D-Gloucester/Cumberland/Salem, said would be met.
“The budget we will introduce is far from perfect and will still be a tough sell among Democratic lawmakers, but the governor should be commended for working with us to take the sting our of some of its most harmful cuts,” Sweeney said of the budget compromise reached with Christie. “Most importantly, this budget will be signed on time, and all the rumors of a shutdown will remain just that.”
Some thoughts:
It’s clear who is serious and who isn’t. New York raises cigarette prices to 11 bucks a pack, and expects higher revenues rather than increased smuggling and a more powerful mafia. Massachusetts spends its savings while hoping for a federal bailout. And let’s not even bother with California. At the other end of the spectrum are Colorado and New Jersey, where real cuts will bring budgets closer to real balance.
It’s also clear that sometime in the next year or two, the worst-run states will balk at laying off half their workers and will choose instead to default on their debt, presenting Washington with the same choice as with the banks in 2008: bailouts or contagion.
Even where states make real cuts in spending, the resulting economic contractions will be brutal.
Muni bonds, which are funded by sport stadiums and the like — or by state/city general revenues — are the next sector to blow up.
If you have seen flyers for this blog
That means your a part of the community i live in, it's a rather nice place with lots of nice folks. i wont ever mention the state or local name for where we live due to opsec.
I do have to say that if you believe or don't believe the currency will collapse here in America, the tips i will provide you will insure that even if the economy hums back to life and has 10% growth for the next 50 years, these tips will still serve you well.
It seems we have come to rely far to much on other people for our basic needs, including food and water,power,security,etc. We have to get back to providing for our self. Things that we can do now that will help us no matter what(collapse,unemployment,inflation,etc) would include: growing a garden, canning food, solar or wind power, generators, stored fuel, candles, wood burning stoves and furnance's. outdoor ovens/grills.
When the currency collapse comes, and it will my friend, if you want to believe it or not wont matter. You have to be prepared for it, your family will need you to be prepared for it.
A years worth of food put back is going to be a good investment if the currency collapse's, you become unemployed(one less thing to worry about) or rampant food inflation happens.
http://www.msnbc.msn.com/id/24127314/
Still, the higher U.S. prices seem eye-popping after years of low inflation. Eggs cost 25 percent more in February than they did a year ago, according to the USDA. Milk and other dairy products jumped 13 percent, chicken and other poultry nearly 7 percent.
What is going to happen when the power goes out for 2 weeks because of a bad ice or snow storm? well if you listen to my advice, then nothing, cause you have already set up generators or solar/wind power.
your not one of the helpless masses!!
I do have to say that if you believe or don't believe the currency will collapse here in America, the tips i will provide you will insure that even if the economy hums back to life and has 10% growth for the next 50 years, these tips will still serve you well.
It seems we have come to rely far to much on other people for our basic needs, including food and water,power,security,etc. We have to get back to providing for our self. Things that we can do now that will help us no matter what(collapse,unemployment,inflation,etc) would include: growing a garden, canning food, solar or wind power, generators, stored fuel, candles, wood burning stoves and furnance's. outdoor ovens/grills.
When the currency collapse comes, and it will my friend, if you want to believe it or not wont matter. You have to be prepared for it, your family will need you to be prepared for it.
A years worth of food put back is going to be a good investment if the currency collapse's, you become unemployed(one less thing to worry about) or rampant food inflation happens.
http://www.msnbc.msn.com/id/24127314/
Still, the higher U.S. prices seem eye-popping after years of low inflation. Eggs cost 25 percent more in February than they did a year ago, according to the USDA. Milk and other dairy products jumped 13 percent, chicken and other poultry nearly 7 percent.
What is going to happen when the power goes out for 2 weeks because of a bad ice or snow storm? well if you listen to my advice, then nothing, cause you have already set up generators or solar/wind power.
your not one of the helpless masses!!
What Would Fiscal Austerity Look Like In The U.S.?
http://economicrot.blogspot.com/2010/06/what-would-fiscal-austerity-look-like.html
Cafferty's question to viewers: What would fiscal austerity look like in the U.S.?
I think one of the most accurate comments was:
'those who have not prepared for the worst will suffer the most. It would come down to a simple matter of survival of the fittest and it would be brutal since the government has made a habit of propping up the poor with programs that would have to be curtailed. America would clearly become a nation of haves and have-nots. And, as a result, there would be chaos and riots unlike anything America's ever seen."
Cafferty's question to viewers: What would fiscal austerity look like in the U.S.?
I think one of the most accurate comments was:
'those who have not prepared for the worst will suffer the most. It would come down to a simple matter of survival of the fittest and it would be brutal since the government has made a habit of propping up the poor with programs that would have to be curtailed. America would clearly become a nation of haves and have-nots. And, as a result, there would be chaos and riots unlike anything America's ever seen."
Maywood, California Fires all Employees, Becomes a 100% Contracted City
The Los Angeles Times reports Maywood to lay off all city employees, dismantle Police Department
http://latimesblogs.latimes.com/lanow/2010/06/sheriffs-dept-to-patrol-maywood-while-city-employees-now-face-lay-offs.html
http://latimesblogs.latimes.com/lanow/2010/06/sheriffs-dept-to-patrol-maywood-while-city-employees-now-face-lay-offs.html
Report: California on 'Verge of System Failure'
http://www.moneynews.com/StreetTalk/California-verge-System-Failure/2010/06/21/id/362560
As cali goes, so does the nation. As more and more cities/towns and states come to the realization that they are BROKE, more are more will be defaulting on their debt or asking for a government bail-out. For those that hink "hey it's only crazy ass cali that is in trouble", please read thru the last couple of months i have posted here. Illinois is 6 billion behind from LAST year, 32 states had to borrow 37 billion for unemployment benefits this year.
To imagine the good times are comming back is a sad joke your playing on yourself friends, wake up now and get ready so your better prepared for whatever comes your way.
As cali goes, so does the nation. As more and more cities/towns and states come to the realization that they are BROKE, more are more will be defaulting on their debt or asking for a government bail-out. For those that hink "hey it's only crazy ass cali that is in trouble", please read thru the last couple of months i have posted here. Illinois is 6 billion behind from LAST year, 32 states had to borrow 37 billion for unemployment benefits this year.
To imagine the good times are comming back is a sad joke your playing on yourself friends, wake up now and get ready so your better prepared for whatever comes your way.
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