Newt Gingrich's bankruptcy dreams The real goal behind a plan to allow states to default:

[EV_Ares]

Crushing public sector unions once and for all

Mary Williams Walsh begins a page one story in Friday's New York Times with the following sentence:

Policy makers are working behind the scenes to come up with a way to let states declare bankruptcy and get out from under crushing debts, including the pensions they have promised to retired public workers.

As Felix Salmon heatedly explains, this is a tricky story to do, because the very mention of the idea that states might default on their bond obligations sends bond markets into a big tizzy, which results in higher interest rates, which makes borrowing more expensive and ends up putting state finances in an even lousier situation. And such a scenario is already underway, as municipal bond yields have started rising ever since chatter about the possibility of a nuclear bankruptcy option to solve state financial woes started being discussed.

Newt Gingrich should be proud, because, as Walsh reports near the end of her article, he started the bankruptcy groundswell while giving a triumphalist post-midterm election speech at the Institute for Policy Innovation in Dallas. But if you actually read the speech, (something I don't recommend for any liberal who wants to sleep well for the next month), you will discover that Gingrich is hardly at all concerned with the problem of helping states "get out from under crushing debts." His primary goal is to break public sector unions, pure and simple. The entire speech is a monument to partisanship, epitomized by his quotation of Reagan's famous answer to the question "What's your vision of the Cold War?"

Link to article: http://www.salon.com/news/newt_gingrich/index.html?story=/tech/htww/2011/01/21/newt_gingrich_and_state_bankruptcy

[opihimoimoi]

1. Newt is an EVIL man...he cares not for the Common Folk...his trend reveals

[SlipperySlope]

2. A couple of questions...

1: If states were allowed to declare bankruptcy, which states are the most likely candidates?

2: Assuming there was a state that simply could not raise the money to pay its bills (including pensions), then how should those bills get paid?

[shanti]

3. he and pete wilson...

birds of a feather. that was petey boy's big obsession and i highly doubt he's done with it. it's the republicon agenda, to destroy the unions.

[jody]

4. Perhaps states like California and New York and Illinois will sit down with their government

employee unions and look at their health plans and their pension plans and solve their deficit problem.

[peacebird]

5. to solve the health plan "problem" we need single payer system - cut out the health ins cos

and the hmo's.

As far as pension plans - if the states did not fund them properly, then the states need to find ways to make them whole. It is not the retirees who screwed up, it is the state.

[jody]

6. "states need to find ways". If a state's govt is controlled by state employees, do you really

believe they will vote:
a. to reduce their pensions and benefits or
b. to increase taxes on workers in the private sector and businesses?

[peacebird]

7. but the states govt is controlled by politicians who do NOT consider themselves "state employees".

The politicians will think nothing of slashing benefits for the "state employee", and will likely consider it their "fiscal responsibility" to slash the state workforce as well, throwing thousands of hard working people into unemployment.

[jody]

9. OK "states govt is controlled by politicians" but who controls the politicians? n/t

[peacebird]

11. corporations. (citizens united & corp "personhood"+mega$$$ for politicians)

[jody]

12. Do you believe state employee unions have no influence on elected officials? Yes or No. n/t

[peacebird]

13. I believe politicians are more influenced by corp $$ than by state employees unions

[sarcasmo]

8. Will they have to allow cities to declare bankruptcy as well?

[jody]

10. Cities can declare bankruptcy. n/t