Wed June 27, 2012
Stockton CA may well take Chapter 9 bankruptcy this week. This would be the largest city in the US to do so. A crumbling real estate market, dropping property taxes, and union pension costs are the cause.
Wells Fargo foreclosed on the proposed City Hall Building. This last link is to Mish's site. He has suggested that it will only take one large city to file Chapter 9. That may open the floodgates for many others to do the same thing. If cities believe they can unwind union contracts that are strangling the finances, they are likely to do so.
It will be interesting to see if this happens before the election in November. Now that hte unions lost their big recall election in Wisconsin I suspect more mayors and perhaps governors will be willing to take them on.
Idaho has two issues on the November ballot to limit collective bargaining rights for teacher unions.
Professor Elam 
Leave a comment