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Saturday, December 18, 2010

What if California Goes Bust?

Here is a good think piece, and not too long.  What does the US Constitution allow the US Congress to do when a state goes bankrupt?
Incoming California Governor Jerry Brown has gotten a look at the state budget and concluded that "We've been living in fantasy land. It is much worse than I thought. I'm shocked."
Jerry Brown and Captain Louis Renault.

The question is, is the kind of action a state might take with regard to a municipality, say Lowell, or Lawrence or Springfield, allowable under the US Constitution's Guarantee Clause:
"The United States shall guarantee to every State in this Union a Republican Form of Government."
So, can the US Congress force California (or New York), in return for a bailout, into a kind of receivership, with someone or some board in charge of the State and its actions?  And even if it can, should it?

Regards  —  Cliff

2 comments:

lance said...

There may be one more chance: after submitting his Doomsday budget, Brown may let himself be persuaded by the Legislature to ask for a special election in April or May for Californians to vote on tax reform and increased taxes.

Then the Federal Government can step in on a more active basis than they already are, for instance the courts running the prision system.

C R Krieger said...

If he pulls that off he will have proven himself a worth son of the late Edmund G Brown, fabled Governor of California.

I would suggest that it would be nice to see the expression "spending reductions" in the discussion.  At the end of the day there are only so many taxes that can be collected.  It appears even Matthew broke that code, as did Zacchaeus.

Regards  —  Cliff