The Bankrupt Leading the Bankrupt

John Ransom
Posted: Aug 27, 2012 12:01 AM

If the world without a strong American economy struggles, so too does an America without a strong California economy. 

The Golden State, which once represented the promise of America, is mired in swampland of broken promises, graft, political stupidity and liberal fantasy.

And if California represents the very best government that liberals can give us- and it likely does- then this country had better take a deep breath and step away from progressive math.

Because, it just doesn’t add up.

California has a government that is structurally unable to support its’ addiction to runaway government spending- like DC; they have “balanced” their budget based on the fantasy that the federal government will bail them out with increased taxes- like DC; they have municipalities in thrall to public sector unions- governments choosing union benefits over investor rights- like DC did in the GM bankruptcy.

“Step right up, ladies and gentleman, and buy a bond. Don’t worry. It’s safe. If we can’t pay, we’ll just declare bankruptcy. And hit you for another loan.”

California is leading the new wave of city bankruptcies in a feat of fiscal irresponsibility never before matched in the history of our Republic.

And it could be spreading to other states.  

If there is a crisis in confidence in the country, it starts in California.

The state’s leading export used to be escapist fantasy enabled by movie studios.

Today it’s escapist fantasy enabled by tax receipts, modern credit and bankruptcy laws.  

 “Beautiful credit! The foundation of modern society,” wrote Mark Twain, who knew a little about California dodges and exigencies. “Who shall say that this is not the golden age of mutual trust, of unlimited reliance upon human promises? That is a peculiar condition of society which enables a whole nation to instantly recognize point and meaning in the familiar newspaper anecdote, which puts into the mouth of a distinguished speculator in lands and mines this remark: ‘I wasn't worth a cent two years ago, and now I owe two millions of dollars.’”

Oh and it’s not just credit where California is leading the nation.

In the government corruption field they are doing pretty well too.

Maxine Waters, the congresswoman from California’s 35th district, has faced a lengthy ethics investigation. She’s known to some as one of the most corrupt members of Congress. Allegations include using her influence to divert TARP funds for her family, paying members of her family from taxpayer and campaign funds and securing government bond business for family members as well.

Waters is just a few million votes away from being in charge of the committee in Congress that oversees the financial services industry, much to the shame of Democrats.     

Earlier this month, California’s congresswoman from the 37th district, Rep. Laura Richardson, was reprimanded by Congress “for pressuring her office staff to help out on her political campaigns and trying to cover up the violations by coaching the staffers to lie to investigators,” according to the Washington Times.

And before we forget, California also is the home to former Madame Speaker, Nancy Pelosi, who won’t be remembered so much for being the first female Speakers of the House, but rather for being one of the worst Speakers of the House, regardless of gender.

Which leads us to California governor Jerry Brown, who is genderless in our eyes, because really he is just an overgrown child.

His state is facing a budget shortfall of about $16 billion.

His solution?

Raise taxes to close the gap and then spend $68 billion on a high speed train to nowhere.

The initial spur of Brown’s high-speed fantasy will go from Madera to Bakersfield, passing through Fresno, Selma and the mighty metropolis of Delano.

Yeah and if you said “Where?” you are not alone. No one outside of California’s Central Valley understands the project.

“Moreover, several audits and reports have expressed concern that the funding to finish the project won't be available,” writes the CSMonitor, “lacks sufficient oversight, and doesn't comply with a 2008 ballot measure by which voters authorized use of state funds for high-speed rail in the first place. A statewide Field poll in June concluded that Californians, if asked today, would vote down the project.”   

Oh, never mind that the state will likely never be able to raise the money for the entire project. Just go ahead and spend the $6 billion in initial construction costs, including $1.8 billion in pork barrel spending, and $3.2 billion in federal funds.

For the folks back home, outside of California: That’s your $3.2 billion they are spending.   

So now Governor Brown can have a high-speed rail project in the same way that Obama supports the Keystone Pipeline. As long as neither actually goes somewhere, nor does something useful, we can leave the rest to a bailout for another day.

Like so much about the progressive ascendancy of the past few years- Solyndra, solar, stimulus, so-called TARP- the math doesn’t work in California.

Bankruptcy doesn’t seem to be so much of a possibility as it is a feature of California’s government, economy and public ethics.    

It’s the bankrupt leading the bankrupt.

And a childish politician shall lead them- just like in DC.