Photo: By Brian Auer on flickr
Bill Lockyer, the Treasurer of the State of California, is out slamming the idea of state bankruptcies, saying they wouldn’t be helpful, except to incite panic.We basically agree.
Via Economix, this will also anger people:
California has a $25 billion budget deficit, but Mr. Lockyer said residents of the state paid much more in federal income taxes than California ever get back in federal transfers.
“People ought to thank California,” he said.
The thing is, that’s basically true, and it’s a point that people who gloat over the collapse of certain states, don’t tend to acknowledge.
By and large, the “Red States” that are seen as paragons of fiscal sustainability are among the most dependent on Federal aid, while the blue states generall (not always) pay in mroe than they take out. This is a fundamental difference between the US and Europe, where the poor peripheral states who are in the most fiscal trouble don’t tend to bail out the richer states in any way.
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