House Majority Leader Eric Cantor said he didn't support allowing states to seek bankruptcy protection and ruled out any federal bailouts of state governments."There will not be a federal bailout of the states," he said at a news conference Monday.
Rep. Cantor, (R., Va.), is the latest Washington official to take a dim view of further fiscal aid to state governments.
On Jan. 7, Federal Reserve Chairman Ben Bernanke ruled out a central-bank bailout of state and local governments straining under municipal debt burdens, saying the Fed had limited legal authority to help and little will to use that authority.
Mr. Cantor, the number-two House Republican, said states had the tools to deal with their fiscal challenges, including renegotiating agreements with public-sector unions, so there was no reason for federal involvement in their fiscal problems.
Great. So states that need help aren't going to get it. What a great way to sabotage an economy that is mending. I have another idea: let's not raise the debt ceiling and see what happens in world bond markets -- oh, they're already considering that move.
Here's the deal: like it or not, government spending is part of the economy and government employees perform useful tasks that help us all be more productive. For example, do you like that street you drove in on? I know I do --it helps me get to appointments. And how about that employee you just hired who can read and write? Pretty convenient, isn't it? Or how about the fact that no one broke into your house last night because the police were around to stop them? Kind of a nice feeling, isn't it? I have an idea -- let's start to gut those services, because we really don't need them. The result is called anarchy, a politically unwise decision to make.
Also -- have you noticed that no one is talking about tax increases? It's always spending that has to be cut. At this point, I return to what is becoming a central theme: the U.S. costs money to run -- and it's not going to run itself. If you benefit from that (and we all do, so it's a moot question) deal with the fact that you pay for what you get.
Cantor's statement is shortsighted, myopic and downright stupid and uninformed. Period.
