Jeb Bush, Newt Gingrich say states should go bankrupt
01/27/2011
Bankruptcy. Once such an ugly word, bankruptcy has become the norm in the new economy for both businesses and ordinary folks.
Now with cities and counties around the nation considering bankruptcy as a way of getting out from under debt, former Florida Gov. Jeb Bush and former House Speaker Newt Gingrich, say Congress should amend the bankruptcy laws to allow states to legally declare they are broke.'
Bush and Gingrich make their case in an op-ed piece in the Los Angeles Times.
As they see it, bankruptcy would allow states to dismantle contracts with employees ending lucrative salaries and even more lucrative pension plans.
There is a bit of an irony here for Bush. As governor, he supported and signed legislation in 1999 that forced Florida's cities and counties to pay a great deal more for police and firefighter pensions. And the formula was changed to make those pensions far more lucrative - and expensive for taxpayers.
Bush and Gingrich also derided the fact that California will pay $100,000+ pensions to 12,000 state and municipal retirees.
Considering that more than 70 Martin County firefighters earn more than $100,000, according to The Palm Beach Post, it would appear that Bush's signing of the 1999 pension plan is now contributing to increasing the number of six-figure pensions in Florida.
And just as an aside - perhaps one reform that Florida Gov. Rick Scott should consider is the elimination of pensions for elected officials.
Since candidates always campaign against "career politicians" and many favor term limits, why in the world should elected officials get tax-payer funded pension?
I don't see any advantage of states going bankrupt. Social Services will fail and the economy will crash. Not even a debt default for all state is guaranteed.
Posted by: loan modification attorney | 09/14/2011 at 02:18 AM