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I think I saw somewhere that California state spending DOUBLED between 1996 and 2006, going from $100 billion to $200 billion in just a decade. Localities coul
by stretchwithme 17y ago
I think I saw somewhere that California state spending DOUBLED between 1996 and 2006, going from $100 billion to $200 billion in just a decade.
Localities could have used all that housing bubble tax revenue to pay down their debt, but instead many choose to spend it as fast as they could get it. And now their ability to meet their commitments is collapsing.
I'd like to see spending growth limited to the 5 year moving average of a municipality's revenues, with the excess going to pay down debt. Politicians are just too short sighted to be allowed to spend everything.
- joshu 17y agoI have had EXACTLY the same thought about the 5 year moving average. Although I think having the excess going to pay down debt is just an encouragement to run up more debt. Instead, why not hold/invest, like a private university would?
- stretchwithme 17y agobecause then they would continue to be in debt in order to invest and thats something that doesn't quite make sense. and when they go cash in those investments during a down economy, they'll all be down. unless they put it all into derivatives.