“there is nothing covered up that will not be revealed, and hidden that will not be known.”
The word on the street is that the Fed’s will not bailout the states. The state most often mentioned in these discussions is California.
I lived in California for five decades (1957-2007); twenty of those years were in or around the Silicon Valley, twenty more were in pastoral ministry all over the state. I earned an undergraduate degree and two graduate level degrees in the tarnished Golden State. It’s tarnished due to an entrenched corrosion called liberalism.
At this date the Obama White house is approaching its first six months anniversary; one thing is clear – Rush is right: “It’s not what they say but what they do that matters to Citizen Taxpayer.” [my paraphrase]
Obama says they will not bailout the states, but watch what he does. His administration will do what has been done in other unpopular areas (TARP, auto bailouts, Wall Street vs Main Street, …); he will simply dress bailouts in drag.
They won’t be called bailouts, they won’t be channeled through normal channels, there’ll be no legislative oversight, and God forbid if there is a judicial review. It will smell like a bailout, look like a bailout, feel like a bailout, and each state’s shortfall will disappear just as they would under a bailout … but no one will be allowed to call it a bailout.
The White House budget office will simply shift numbers from credit to debit on the state’s books; a similar but opposite shifting of entries on the federal ledger will simultaneously take place with a “eureka” net flow of cash credits to each state equal to its deficiencies. Voilà!
Your state officials, both elected and appointed, won’t care about the long-term effect of this quasi-borrowing because the actual borrowing will be against the federal accounts.
However, the entanglement with the Feds will result in the same web of controls as the auto makers, insurance industry, and banking industry experienced under TARP funding.
Suddenly you state’s 10th Amendment sovereignty has been taken down a notch; those illegitimate children you elected to represent you won’t notice or care, because it was their collective butt that was saved. What’s a little sovereignty anyway? We’re all Americans in the end, right?
Mark my words: when the dust settles, it won’t be liberal entitlements providing the funds for this slight of hand, it’ll be conservative or family values programs that will cough up.