Here's something you might be interested in.
Policy makers in Washington DC are working behind the scenes to find a way to let states declare bankruptcy and get out of debts, including pensions promised to retired workers, according to a New York Times story that just went on the wire and will appear in tomorrow's (Jan. 21) print edition. Because of the gravity of the situation in states such as California, Illinois, and New Jersey, the subject has been discussed among scholars; the Wall Street Journal recently had an op-ed on possible state bankruptcies. "Some states are so burdened that the only feasible way out may be bankruptcy," says author Mary Williams Walsh. "Some members of Congress fear that is just a matter of time before a state seeks a bailout." Bankruptcy would permit a state to change its contracts with retirees, who may be protected by state constitutions, says Walsh. Consideration is now hush-hush for fear of disrupting the municipal bond market. Government employee unions are fearful: "They are readying a massive assault on us," says the legislative director of the American Federation of State, County and Municipal employees.
Policy makers in Washington DC are working behind the scenes to find a way to let states declare bankruptcy and get out of debts, including pensions promised to retired workers, according to a New York Times story that just went on the wire and will appear in tomorrow's (Jan. 21) print edition. Because of the gravity of the situation in states such as California, Illinois, and New Jersey, the subject has been discussed among scholars; the Wall Street Journal recently had an op-ed on possible state bankruptcies. "Some states are so burdened that the only feasible way out may be bankruptcy," says author Mary Williams Walsh. "Some members of Congress fear that is just a matter of time before a state seeks a bailout." Bankruptcy would permit a state to change its contracts with retirees, who may be protected by state constitutions, says Walsh. Consideration is now hush-hush for fear of disrupting the municipal bond market. Government employee unions are fearful: "They are readying a massive assault on us," says the legislative director of the American Federation of State, County and Municipal employees.