Reason not to Increas CRA DEBT...

InlandPolitics Commentary: As stimulus money runs down state and local governments struggle
Written by Administrator
Posted March 11, 2010 at 1:53 pm

As federal stimulus dollars start to run out, layoff announcements by local governments abound.
The stimulus package passed by Congress and signed by President Barack Obama was nothing more than a band-aid to delay the inevitable.
Government, the largest employer in the nation is beginning the painful process of downsizing. A downsizing never-seen-before by this generation.
Anyone who expected that the U.S. Government money printing press would fix the economy was sadly mistaken. The economy will reset itself sooner or later, with the sooner scenario coming on fast.
Economic forces are powerful. And those forces are about to demand the de-leveraging of all the massive debt racked up by government, companies, and individuals.
As tax revenues continue to fall, public entities of all shapes and sizes have no choice but to downsize either by across-the-board wage reductions or massive layoffs.
Government has become a big business, bigger than ever before.
Now it’s time to pay the piper.
Whether it’s compensation cuts or layoffs, the effect on the economy is the same. Government spending cutbacks will further bring down the economy further. The Inland Southern California unemployment rate was released yesterday at 15.0%. Add in workers seeking full-time jobs, but working part-time, and those who have stopped looking and the rate is north of 20%. This is known as the “real” rate of unemployment.
Interesting how there’s the rate and then the “real” rate!
It’s all a numbers psychology game, and it’s not working.
California, the seventh largest economy in the world is paralyzed with about $600 billion in debt and a $22 billion budget deficit. It will get worse before it gets better.
The state’s unemployment insurance fund is almost $8 billion in the red.
Amazingly, California state government has yet to embark on any meaningful reduction in its workforce.
While a state can’t file for chapter 9 bankruptcy, all cities, counties, and school districts can. The state can however default on its obligations.The unthinkable will happen at some point. Expect the state to draw funds from local governments in order to survive. Bankruptcy will allow local jurisdictions to break costly labor agreements and reduce employee related costs.
It’s just starting.

THIS IS WHY GT SHOULD NOT INCREASE THE DEBT LEVEL OF CRA or the CITY... ONLY THOSE WITH UNBURDENED CASH WILL BE ABLE TO THRIVE...