Thursday, August 01, 2013

Cause of City of Stockton bankruptcy and who is responsible

Until Detroit knocked it out of the news, Stockton was the largest US city to file for bankruptcy. The Stockton Record reviews the results of audits of the city performed by both Stockton City Manager Bob Deis and State Controller John Chiang:
Both Deis and Chiang's auditors identify three factors that thrust Stockton into bankruptcy:

» Skyrocketing retiree health care costs.

» Labor contracts that were neither "transparent nor sustainable."

» Three multimillion-dollar bonds issued in 2007 and 2009, putting Stockton deeply in debt. Those include a $125 million pension obligation bond and another for $41 million to buy the 400 E. Main St. building, which was to become the new City Hall.
In other words, Stockton failed primarily because of out-of-control government employee salaries and benefits, a problem typical of leftwing governments.

Some on the interwebs have tried to blame this bankruptcy on Republicans.  They cite a Republican or two in government there and then reason that the inland valleys of California, where Stockton is located, are largely Republican and therefore Republicans control Stockton.  That is wrong.  Voter registration statistics for Stockton are available from the CA Secretary of State here  or here(PDF):  Democrats have a whopping voter registration advantage in Stockton of 63,670 to 36,240.

1 comment:

Income Protection Insurance Redundancy said...

Whoever it is responsible for the bankruptcy, it is the people who really takes the hit.

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