Why California Is Going Broke

[Rupert Pupkin]

There is a city in California called San Bernadino that filed for bankruptcy in August. The problem there is the same problem we have throughout the state:

"Little by little, over many years, the salaries and retirement benefits of San Bernardino's city workers — and especially its police and firemen — grew richer and richer, even as the city lost its major employers and gradually got poorer and poorer."

"Unions poured money into city council elections, and the city council poured money into union pay and pensions. The California Public Employees' Retirement System (Calpers), which manages pension plans for San Bernardino and many other cities, encouraged ever-sweeter benefits. Investment bankers sold clever bond deals to pay for them. Meanwhile, state law made it impossible to raise local property taxes and difficult to boost any other kind."


http://www.reuters.com/article/2012/...8AC0HP20121113

What is bankrupting the state is these insane pensions. Some people would say that the state simply needs to raise taxes, but taxes are already way too high. The highest tax bracket now has to pay 13% in state income tax. When the federal tax goes up next year, the people in the highest tax bracket will be paying over 54% in state and federal taxes. And that obviously does not include all the money these people already pay in sales tax. The problem isn't that taxes aren't high enough. The problem is that the pensions are way too high and they are bankrupting the state. But the unions won't allow them to lower the pensions. And people in California keep electing these same liberal clowns who are in the pockets of the unions.