Just when you think it cannot get more evil than this, news comes that it can. Via Naked Capitalism, we have this Reuters post, Secret GOP Plan to Push States to Declare Bankruptcy and Smash Unions:
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.
How? By denying them Build America bonds.
The most intriguing aspect of President Barack Obama’s tax deal with Republicans is what the compromise fails to include — a provision to continue the Build America Bonds program. BABs now account for more than 20 percent of new debt sold by states and local governments thanks to a federal rebate equal to 35 percent of interest costs on the bonds. The subsidy program ends on Dec. 31. And my Reuters colleagues report that a GOP congressional aide said Republicans “have a very firm line on BABS — we are not going to allow them to be included.”
No surprise since the public pension fund is one of the last hold outs for any sort of retirement, so of course it is a target. On the other hand, California, as well as Illinois refuse to deal with major costs, including their illegal immigration budget busting problems.
I think now is a good time as any to suggest watching Senator Bernie Sander's floor speech on how America is quickly becoming a Banana Republic.