Well, this isn’t good:
Standard & Poor’s Ratimg Services has placed California’s credit rating, already the lowest among the states, on a watch list “with negative implications” due to the state’s chronic and unresolved budget deficit.
The credit watch notification on general obligation and lease-revenue bonds reflects “our assessment of the state’s projected depletion of cash by the end of July 2009 absent the adoption of a significant revision to the fiscal 2010 budget,” S&P said in a statement.
“Although we continue to believe the state retains a fundamental capacity to meet its debt service, insufficient or untimely adoption of budget reforms serve to increase the risk of missed payments in our view,” the notice continued. (CapAlert 6/16/09)
That’s going to cost us some more money as we will have to pay higher interest rates. You know what would help? The federal government guaranteeing our loans as a backstop. It wouldn’t cost the feds a dime, as California really won’t default on our debts. It could save the state over a billion dollars, dollars that could be spent on the state’s neediest instead of the big financial institutions.
…State of California. Buh…buh…you say Democrats control the state!
Really?
Doesn’t look like it to me. Nor if you read the threads around the ‘sphere do most folks think so. To much of the nation it’s we the people of CA who are at fault for our wasteful nut-ball ‘Hippie Ways’.
Yep, we’re still a bunch o’ hippies…
No masses of brain-dead Rethugs teeming in the Central Valley, no spineless Dem ‘Leader$hip’ in the state legislature. Just a bunch o’ pot-smokin’ hippies.
From coast to coast ‘America the Stupid’ is supreme. From the Oval office to the floor of the Senate the inept, the stupid and the greedy lead us….
…to nowhere.
Sure looks like a lot more pain needs to be administered to the ‘body politic’ as the message does not seem to have penetrated yet.
‘Business as usual…’ is destroying our nation, our society, the whole human race.
Here is my answer to the Kool-Aide guzzling morans who just think we need to give Obama ‘a little more time….’ Right here:
http://dieoff.org/page125.htm
We don’t have much time left. If any….
General Strike anyone?
You’ve said this a number of times:
I’m not so sure we won’t. Herr Governor is pushing for his lunatic set of cuts, and the Democratic leadership does not seem willing to fight for the need for more revenue.
Given the combination, it’s entirely possible that the state is going to have difficulty paying its debt obligations. Maybe not to the extent of default, but almost certainly to the point that the state needs to start negotiating with creditors.
And unless the state has some kind of strategy to get its cash flows in order, I don’t think that a partial default is at all out of the realm of the possible. If that happens, then federal guarantees of our debt could cost the federal government money. Potentially, quite a lot of it.
There is no incentive for Washington to help Arnie. Arnie is already playing fast and loose with the federal money he is supposed to administer. The feds will love watching Arnie and the GOPer’s crash and burn. There will have to be some big changes in Sacramento before the feds kick in any more money. Meanwhile, the poor schmucks on the bottom will suffer.