Government isn’t immune from wanting a bailout, with the Governors of New York, New Jersey, Massachusetts, Ohio and Wisconsin calling on the Obama Administration to provide a $1 trillion bailout for cash poor states.
Ohio Gov. Ted Strickland said that the situation in his State was so dire, that they’d have to cut every item in their budget by 25% just to make ends meet. New York Governor David Paterson said that “there are states that are talking as California has of not being able to meet their financial obligations in the coming months.”
While tax takes are down across the board as the recession bites, the ineptitude that has put America in the position it’s in is now being shown at the top. That the States can’t pay the bills says more about extremely poor budgeting during the good times, and an inability to save for a rainy day. Well…given many State Representatives come from big business, it’s really not that surprising either.
My question though: Whatcha going to do when the money runs out? No matter how much the outgoing and incoming Administrations, along with Congress promise to spend on bailing out every last remaining bank, car company, business of just about any sort, and even States, the US Government does not have a bottomless pit of money either. With a massive debt issue already, somewhere in the next 12 months the money has to run out if the Government keeps offering bailouts by the hundreds of billions and trillions, and then worse times may would be ahead. I can’t say I disagree with some who argue it’s better to deal with the issues now and let companies go bankrupt so it’s quicker to recover from the mess, where as now the US Government seems to be only prolonging the very practices and people who put the global economy into the position it is today, while increasing debt that will take even longer to pay off.