Is California The Next GM?
With GM’s bankruptcy no longer hanging over Wall Street, perhaps now investors can get their minds right for some really bad news. We’re talking about the looming bankruptcy of California, of course, and of at least a few more big-budget states whose books are in equally disastrous shape, including New York, Arizona, New Jersey, Nevada, Rhode Island and Florida. All told, the 50 states are looking at budget shortfalls totaling $350 billion over the next two-and-a-half years, according to the Center on Budget and Policy Priorities.
A disaster is taking shape before our eyes, although you’d never know it from all the celebrating that’s been going on in the stock market. Consider these sobering statistics from the Rockefeller Institute. They were cited by our colleague Bill Buckler of The Privateer, one of our favorite reads : “[With California leading the pack,] state tax collections continued to fall in the first quarter as muted consumption, falling incomes and weak profits plunged the states into a deeper fiscal hole,” writes Buckler. “The 47 states that have reported first-quarter revenues saw total tax collections fall 12.6 percent compared with the first three months of 2008. The steepest drops were in income taxes due to climbing unemployment. Corporate taxes declined 16.2 percent in the latest quarter, reflecting weaker profits. Personal income taxes fell 15.8 percent. Sales taxes were down 7.6 percent. Forty-five of the 47 states saw revenues decline.”
SOURCE: DPROGRAM.NET
{ALL THAT IS EVIL WILL BE EXPOSED}
