House Republicans Plan to Force California Into Bankruptcy to Bust Unions

House Republicans Plan to Force California Into Bankruptcy to Bust Unions
by: Robert Cruickshank
Fri Dec 17, 2010 at 13:30:00 PM PST

"If you've been reading Calitics for any length of time, you know that one of the things we often point out is that California cannot go bankrupt. Our constitution mandates bondholders be repaid before any other expenditure aside from K-12 schools. And a federal law passed in 1937 to stop Arkansas from going bankrupt ensures that while city and county governments (like Vallejo and Orange County) can declare bankruptcy, states cannot.
But that could be about to change if House Republicans get their way, according to a recent Reuters article:

Congressional Republicans appear to be quietly but methodically executing a plan that would a) avoid a federal bailout of spendthrift states and b) cripple public employee unions by pushing cash-strapped states such as California and Illinois to declare bankruptcy. This may be the biggest political battle in Washington, my Capitol Hill sources tell me, of 2011....
Republicans in the House of Representatives already want to stop state and local governments from issuing tax-exempt bonds unless they are more forthright about these future obligations. Republican Representatives Devin Nunes and Darrell Issa of California and Paul Ryan of Wisconsin have introduced a bill that would require state and local governments to estimate the size of public pension liabilities if their assets earned a more conservative rate of return than many plans currently expect. Failure to do so would result in the suspension of their ability to issue tax-exempt bonds.

Reuters cites a Weekly Standard article that laid out the endgame - by changing the law to allow state bankruptcies, and then forcing states to go bankrupt by cutting their funding and undermining their ability to borrow, states would be able to reopen contracts with public employees. Not only could wages and benefits then be cut for current workers, but pension benefits for retired workers would also become fair game for cuts, as has happened with retired auto workers and others whose private sector pensions have been slashed after corporate bankruptcies."

<http://calitics.com/diary/12949/house-republicans-plan-to-force-california-into-bankruptcy-to-bust-unions>

It sure would be great if the west coast could secede from the union!

budget cuts because there is a deficit - health and education programs.
The R's are blaming this on regulations and UNIONS. Looks like a concerted effort is underway.

Republicans fought against the New Deal since before it started. Now they have a big opening to tear it down (thanks to the 2% cut cut on employee contribution). Cutting contributions to SSI doesn't do shit for cutting the debt or deficit. One thing it does do in consideration to the debt/deficit problem is to open a hole for tearing down SSI as a viable program.

Anyone who can do math can figure out that SSI can be self sustainable and is self supported. It doesn't contribute to the deficit one iota! If there are problems with balance, they can be be fixed real easy by balancing funds or adjusting limits.

Putting SSI into the discussion of debt/deficit is pure hogwash.

Why wouldn't the democrats stop this kind of foolishness from passing with the new congress?

Apparently it only takes one Senator to say no to halt any kind of governing - so Democrats - stop this from happening. Use the repug way to protect Americans instead of corporations.