The welfare states, by this I refer to countries and states, are all failing. Their demise is inevitable!
Whether they go in the order of the extent they abused fiscal prudence will be determined by the vagaries of markets and politics. Until another crisis hits, and one could occur any time, it is likely that we will see sequential defaults, roughly in the order of their fiscal abuses. Within the US, California appears to be poised to be the first. If the US steps in to assist, NY, MI, NJ, IL, etc. etc. will form a bail-out line right behind them. Regardless, they are likely to fail shortly thereafter.
The madness of it all is that the US federal government is as bankrupt as California. The only difference is that they own a printing press. But printing money is cannot avoid what is coming. It may, as in the case of Greece, defer an inevitable end. But it does so by weakening whatever strength is left in faltering economies. Greece’s end is certain despite the intervention.
Here’s some news from the state that we used to think wacky many decades ago. Apparently our clever slogans criticizing the craziness of California contained wisdom beyond our years. It is a shame that governments still do not seem to know what seemed so obvious to us in our youth.
Once again, it is the failure of socialism (liberalism is too indefinite a word):
The Daily Caller reports:
California’s problems are being compounded as businesses leave the state. Last month’s announcement that Northrup-Grumman was shifting its headquarters to Virginia followed HP’s announcement that it was also moving out. Maybe these departures have something to do with Chief Executive naming California as the worst state in which to do business, and with the Tax Foundation ranking California as the 48th worst business tax climate in the nation. California also insists on its own rules for gas mileage, silly ubiquitous pregnancy warnings and even its own TV energy usage standards. The message California sends to businesses is clear: Stay away.