How are California & Los Angeles going to survive?
From Wednesday’s New York Times:
Analysis of California Pensions Finds Half-Trillion-Dollar Gap
By MARY WILLIAMS WALSH
Published: April 6, 2010
An independent analysis of California’s three big pension funds has found a hidden shortfall of more than half a trillion dollars, several times the amount reported by the funds and more than six times the value of the state’s outstanding bonds.
The analysis was commissioned by Gov. Arnold Schwarzenegger, who has been pressing the State Legislature to focus on the rising cost of public pensions.
How do you fill a half a trillion dollar budget gap? Unions don’t sacrifice. How do you raise taxes by that much?
But surely the California cities are OK? From the San Jose Mercury News:
Los Angeles could go broke by June 30
By Rick Orlov, Staff Writer
Posted: 04/05/2010 06:00:38 PM PDT
Updated: 04/06/2010 03:40:57 PM PDT
Los Angeles could be broke by June 30 following the Department of Water and Power’s decision to withhold its final annual transfer of $73.5 million to the city’s general fund, the city controller warned Monday.
Calling it the city’s “most urgent fiscal crisis” in recent memory, Controller Wendy Greuel asked for swift action from Mayor Antonio Villaraigosa and the City Council.
“It is imperative that you act now,” Greuel said in a letter. “That is why I am asking you to immediately transfer $90 million from the city’s reserve fund so I can continue to pay the city’s bills and to ensure the fiscal solvency of the city.”
The general fund, which covers city payroll and contracts, would be empty by May 5 without the transfer, Greuel said. But using cash reserves to pay salaries and contracts would deplete the emergency reserve fund by June 30, she said.
How does one live like this? How do you raise kids in this place, knowing that schools, hospitals and other essentials are going to be crap?
Both Los Angeles and New York City have cut back on police officers and have experienced more crime recently. This may or may not be statistically significant, but it ain’t good, writes WitnessLA.com:
Crime Rate Spikes – The Question is: Why?
April 6th, 2010 by Celeste Fremon
Okay, first the facts. The crime rate in LA over the last 13 days has taken a jump, reports New American Media: reporting on a story in La Opinion.
Uh, no wait a minute. There’s also this in the La Opinion article:
An even steeper increase in violent crime has taken place in New York, where crime is up 20 percent. There have been at least 103 murders in New York as of Monday, compared with 86 killings at this time in 2009.
Did I mention that New York has no prisoner release? Consider it mentioned.
The truth is, neither spike is extended enough to qualify as a trend. It may turn into a trend, or both in LA and NY, the rise may be an anomaly caused by a few people.
Over at the Huffington Post, someone actually suggested a Republican idea:
Problem solved if they just drill a few oil and gas wells off the coast…
Actually, two problems solved: State revenue and energy costs…
Posted 04:08 PM on 4/06/2010
It appears that people are moving to Houston (a KLBJ-Austin radio talker scoffed about Houston today), San Antonio and Austin. Three of the top five moved-to cities are in Texas:
CORRECTED: U-Haul Names Houston as Top 2009 Destination
Download image PHOENIX, April 6 /PRNewswire/ — U-Haul International, Inc. today released the results of the annual 2009 U-Haul National Migration Trend Report, titled “The 2009 Top 50 U.S. Destination Cities.” According to moving data reflective of nationwide statistics for calendar year 2009, Houston took the No. 1 spot, moving up from second place, while Las Vegas took second place, moving up from the No. 4 rank last year. Chicago climbed to No. 3 from No. 7 last year, while San Antonio ranked No. 4, moving up from No. 8. Austin, Texas moved up to fifth place from the No. 9 rank last year, and Atlanta, Orlando, Fla., Sacramento, Calif., Kansas City, Mo. and Denver rounded out the top 10.
Note to California liberals: Stay home! SXSW and the Austin City Limits Festival are already too crowded!
But all joking aside, does anyone expect the stock market to keep going up? If California owes an extra half trillion in pensions and Los Angeles barely has enough money to get through another four weeks, what’s going to happen when the stock market heads down again in a hurry, just like 2008?
If there is a crime wave and people are moving out of California now, how can it possibly survive?