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A federal judge is due to hear closing arguments today about whether Stockton in California...

A federal judge is due to hear closing arguments today about whether Stockton in California should be allowed to file for bankruptcy protection. The main is issue is whether the city can continue paying into the Calpers pension fund while forcing losses on bondholders. The case is being widely watched, with Alabama's Jefferson County and California's San Bernardino also considering breaking with the long-standing practice of meeting obligations to bondholders.
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Comments (9)
  • DaLatin
    , contributor
    Comments (1522) | Send Message
     
    This is huge ! The right ruling will start a wave and millions will be poor in there old age ! Many deserve it as pigs need to be slaughtered. Living beyond all comprehension and passing it on to the young to pay....... Must stop now and the pain endured by those folks !
    27 Mar 2013, 05:14 AM Reply Like
  • User 353732
    , contributor
    Comments (4993) | Send Message
     
    It is unmerited benefits and unsupportable people legacy costs that are primarily responsible for this calamity.
    Shouldn't those mostly culpable bear at least some of the costs?
    But then ,in the US Soviet it is force not justice that now prevails.
    Take from those who have not and give to those who already have is the prevailing ethos of the elites.
    27 Mar 2013, 05:23 AM Reply Like
  • DaLatin
    , contributor
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    @353732,, liked it and clicked like !
    27 Mar 2013, 05:26 AM Reply Like
  • davidbdc
    , contributor
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    Seems to me both parties should be getting a haircut. Bond holders shouldn't have loaned the money and the bureaucrats pay and pension are a large reason the money isn't being repaid.

     

    If I were the judge the pension payments would be a no-go but then the city should be allowed to declare BK - both to force creditors to renegotiate the loans and to totally renegotiate public employee pay and benefits.
    27 Mar 2013, 05:53 AM Reply Like
  • chopchop0
    , contributor
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    Most common sense comment on this thread :)
    27 Mar 2013, 06:29 AM Reply Like
  • rootbeer
    , contributor
    Comments (303) | Send Message
     
    If a city can declare bankruptcy without impairing overinflated obligations to a pension fund and without raising taxes to raise revenue, then why would any insurance company choose to insure municipal bonds? And who would even buy the bonds knowing that a city would rather default on its obligations rather than cutting expenses and raising taxes?
    27 Mar 2013, 07:24 AM Reply Like
  • phertz1
    , contributor
    Comments (39) | Send Message
     
    Your comments on overinflated obligations to a pension fund only touches on 1/2 the equation! The other half is the Stockton medical and hospital benefits. Stockton saw fit to give any and all employees (and the city council) lifetime medical benefits considered the most generous in California - the only requirement was to be on the Stockton payroll for ONE DAY! As soon as you were on the payroll, you had lifetime medical benefits for you and your spouse. Great system! If that doesn't bankrupt a city, what will? Of course, the public employee unions (who donate political contributions to the city council) were happy to receive such generosity!
    27 Mar 2013, 07:56 AM Reply Like
  • IgnisFatuus
    , contributor
    Comments (2151) | Send Message
     
    phertz1, interesting comment. I had never heard about that benefit before.
    27 Mar 2013, 09:23 AM Reply Like
  • jhooper
    , contributor
    Comments (6166) | Send Message
     
    I saw this yesterday.

     

    http://bit.ly/10Pn0lX

     

    There apparently are other examples in CA as well.

     

    http://bit.ly/YIon25
    27 Mar 2013, 09:43 AM Reply Like
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