That said, a lot of companies that proved too big to fail weren't too big to change. Wall Street was given compensation caps. GM had to renegotiate its labor contracts. If Washington is going to bail out the Golden State, it should make the money contingent on structural reforms that leave the state better able to balance budgets in the future.
This should be like an IMF intervention (maybe Simon Johnson has some thoughts?). California's legislature is in a strange position: It needs a two-thirds vote to raise taxes but also has to fund ballot propositions that require a simple majority of an uninterested public. The majority party in the legislature, in other words, can neither control how much money it raises nor how much money it spends. That's not a sustainable state of affairs
I think President Obama should direct his staff to think about bailing out California instead, and let the Europeans borrow the billions of dollars they need directly from the Chinese and leave us out of it. We have-- largely because of corrupt hacks like Rahm NAFTA Emanuel-- enough problems right here at home.
"This bail-out for European banks by the American taxpayer is such a bad idea that they had to attach it to a "support the troops" emergency supplemental in order to get it passed.
Dear President Obama, please help California. We have a major league moron for a Governor and the 2/3 vote needed to make any substantial changes in the legislature is killing us. Stan Van Gundy's horrendous coaching of last night's Laker-Magic game is nothing compared with what we have to deal with.