The treasurer of Massachusetts has asked the federal government about lending Massachusetts money under the same favorable terms it has given banks and firms during the financial crisis.Treasurer Timothy Cahill's requests to the U.S. Treasury and Federal Reserve Bank of Boston this week were prompted by the state's inability to borrow from the short-term debt markets, The Boston Globe reported Saturday. The financial turmoil has caused credit markets to stop lending, or to charge prohibitive rates.
California has made a similar request, saying it would run out of money by the end of the month if the short-term debt markets do not ease. The state asked whether it could not obtain loans from the Fed.
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What's so "progressive" about a bankrupt state?
2 comments:
Does anyone see the significance of these events? Government can be the final insurance company. The last resort in the easing a crisis of confidence in The System. But the government can only do that if it has the resources to back itself up. The problem is that our government has spent all it's resources well into the next 3 decades.
So, just like a levy that is built to hold back a 100 year flood, when a 500 year flood hits, the failed levy makes the catastrophe that much worse.
If this $750B bailout does not work, we have just begun to see the crisis of confidence. Now the state governments are starting to fall like dominos. Long term it might be a good thing. The day we lose confidence in the government's ability to solve our problems will be the day we understand reality. That will be the start of a journey back to what made America great in the first place. Unfortunately the lesson will probably be years long and very painful.
This is one of the issues that resulted in my transformation from liberal to libertarian leanings.
You screw up. How does the government pick and chose who gets bailed out or not?
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