From Human Events:
SACRAMENTO – First, Vallejo, in 2008. Next, Stockton, then Mammoth Lakes and, now, San Bernardino and soon, perhaps, Compton. As Orange County Supervisor John Moorlach told Bloomberg News, the bankruptcy dominoes are starting to fall. One California city after another – following a decade-long spree of ramping up public-employee pay and pension benefits, as well as redevelopment debt – are becoming insolvent.
And the state’s legislators have nothing constructive to offer.
California’s exclusively Democratic leaders not only are unwilling to rein in the costs of benefits for their patrons, the public-sector unions, they have been erecting roadblocks in the paths of localities that want to fix the problem on their own. Yet all the political hurdles in the world cannot fix the basic problem of insolvency.
Stockton navigated the new process created by a state law requiring a 60-day period of negotiations before a municipality could file for Chapter 9 bankruptcy.
That period is over, and the city – a hard-pressed port on the edge of the California Delta – has become the largest city in the country to pursue municipal bankruptcy. The cause was a pension system eating up 30 percent of the budget, an absurdly generous retiree medical program and excess bond debt for pension obligations and redevelopment projects.