Government services are going to be cut back, and nobody cares whether you like it or not, or whether you like the way the speech on the cuts was delivered. It does not matter if the president, governor, mayor, etc... has that special bedside manner. The provided link speaks of New York's first blind governor (actually the first blind governor in the U.S., never mind the circumstance that placed him there), who also happens to be African-American, Liberal and a Democrat, having to tell the citizens of New York the TRUTH - state programs in New York will need to be cut to the BONE over the next decade. New York is a VERY high tax state, the rich in that state (people with incomes over $200,000 per year) pay over 85% of state received taxes, (even if you moved it to 100% by adjusting the tax code and allowing those making under $200,000 to pay 0%, essentially living tax free) and the state cannot balance its budget.
New York depends on the financial services industry like no other state and no other industry. Now take an honest look at that industry, where it has been, where it is, and where it is going. The state services in New York have had greater funding than most of the world's countries. The people receiving these services have become quite accustomed to them. They are as addicted to these services to a greater degree than the average American is to cheap oil. It is not even close.
California, home to 1 in 8 Americans and another uber high tax, high services (and municipal pension) state is insolvent.
The political ramifications of what is about to happen in these states is nothing short of stupefying. MILLIONS of New York city residents receive food, medical, and home heating assistance from a state (some of this is born by the Feds) government on the verge of default (my educated guess is these states will default in fact after Oil has averaged $175 plus for 6 months, although it might happen sooner). Any investor holding state or local debt from New York and California has to have ROCKS in their head.
These governments, in an effort to "help" their citizens, have helped to paint them into a very miserable corner. Talk about your unintended consequences.
I have a suggestion. Every politician, political activist, regulator, bureaucrat, lawyer, etc... that is anybody associated with crafting social policy.... should volunteer for summer chess camp. Maybe then these folks would understand that EVERYTHING has a beginning game, a middle game, and an end game, and that each move along the way has a myriad of consequences that might be appealing now, but lead to crushing disaster later.
Mentatt (at) yahoo (d0t) com
4 comments:
(From the bureaucrat non-regulator):
Everyone hear about the new-record Federal budget deficit of half a trillion dollars for fiscal year '09 (the fiscal year starts in October of '08)? It has now gotten to the point where I really see no more need to save money in my office. Just spend it while we have it. No one cares.
I'm very glad that I just graduated a CUNY school in NYC with full tuition reimbursement and extra financial aid, thanks to my subsidized education provided by the financial industry.
Dear recent Grad:
Congrats and good luck! I am happy you got thru the system. Others won't be as lucky. Be thankful, and deserving.
I hope for you great things!
Dear Bureaucrat:
Those deficit numbers are a permanent legacy of the tax and spend Bush Administration. While the name might not stick, in the future their will be no other way for historians to describe these guys.
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