Bankruptcy law can’t protect U.S. from blue state public union pension threat
Much as free speech, free elections and the Electoral College failed to protect us from the ObamaDem super-majority threat
When America faced terror after 911, many liberals played down the threat from Osama bin Laden and terror-sponsoring dictators like Saddam Hussein, by gnashing their teeth over “why they hated us” and how Abu Ghraib and fighting back “created terrorists”.
I remember being told how Mexico and the national debt were greater threats, and given the bang-up job that our armed forces under former Commander-in-Chief Bush, and even the drone-happy current President, it does appear that the tens of thousands of dead terrorists have elevated the priorities of violence on our southern border. Moreover, the threat of ObamaDems grew to grave proportions over the past two years as they fought the debt of the Bush years by more than tripling it. God save us from the saviors akin to Greece!
It was at some point last year that even yours truly began to see threats sans Muslim names when we contemplated a Democratic Congress and White House forcing the frugal red states to bail out their union-benefactors in Cally, New York, Illinois and other irresponsible states willingly held hostage to public employee unions addicted to retiring at age 50 with full pay.
Cities, not states, can be debtors in bankruptcy
And then We the tea-drinking People spoke and thank God for it, because it appears that the only savior on the horizon is the recently convened Republican majority in the U.S. House since the federal bankruptcy code offers no option to states to file:
Section 109. Who may be a debtor(a) Notwithstanding any other provision of this section, only a person that resides or has a domicile, a place of business, or property in the United States, or a municipality, may be a debtor under this title.
States may not file for bankruptcy and some legal scholars claim that a Constitutional Amendment, rather than a mere statute, would be required to allow them to do so given “sovereignty” issues. DeVine Law does not agree with that legal position, but I digress.
The DeMint solution
The best outline of a solution that I have seen comes from Senator Jim DeMint (R-SC):
- First, create a legal process to allow states to renegotiate debts and union contracts in something akin to bankruptcy.
- Second, forbid a congressional bailout of the states.
- Third, forbid the Fed to buy states’ debt as part of a freelance Ben Bernanke bailout.
- In other words, prepare a site for crash-landing state finances and then forcibly guide them to it.
- That third part is interesting, no? Republicans are looking askew at the Fed’s new career as at-large bailout-maker.
The next two years are going to be and are perilous because we haven’t much hope that ObamaDems still controlling the Senate and White House will agree to obvious common sense solutions to problems from creating jobs (Isn’t it a no-brainer that we should be expanding oil drilling on domestic land and seas?); and, reducing deficits and onerous regulations on business (Yet, Obama and Reid have vowed to defend ObamaCare to the death while promulgating carbon-emission regulations that threaten the oil and coal industries.).
All we may be able to do is a William F. Buckley-ite stand athwart history and yell, Stop!
With respect to the DeMint plan that should be enough, unless The Fed goes rogue again and does triple the damage of fiscal policy as it has under Paulson and Geithner.
The bottom line is that for reasons of future moral hazard and all too real present financial hazards to the nation, we cannot let the underwater blue states drown the rest of the lower 48 that paid their bills.
“One man with courage makes a majority.” – Andrew Jackson