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Let me say up front that I agree with you on demonizing people who purchased these bonds. But let me play devil's advocate. For years politicians have been ta

Let me say up front that I agree with you on demonizing people who purchased these bonds. But let me play devil's advocate. For years politicians have been talking about "Predatory Home Loans" where banks supposedly took advantage of people by selling them on loans they could never afford. By law the terms of these loans were spelled out to these buyers. These buyers were told what their payments would be and how much interest they'd pay. Yet the lending practices are still considered predatory because the lender should have known the borrower didn't have the ability to pay the loan. Now, for example, look at the State of California. California's GDP to Debt ratio is nearly 20% and their monthly bills total to more than their monthly income. If the state were an individual it would easily have poor credit. Yet when a bond measure is passed no one spells out the terms. No one makes sure they know how much they'll pay in taxes each month after that to pay off the bond or how much total interest will be paid. So while I agree with you I can see how someone could reasonably direct the rage they had at predatory banks towards bond holders

protomyth 16y ago
Some of the (smaller) banks actually didn't want to lend. They were sued by some organization for being too strict in their lending requirements.
anigbrowl 16y ago
Yet when a bond measure is passed no one spells out the terms. No one makes sure they know how much they'll pay in taxes each month after that to pay off the bond or how much total interest will be paid. Why do you say that? Every time I see a bond measure on the ballot, there's an estimate of the fiscal impact from the Legislative Analyst's Office in the voter information pamphlet, showing the relative costs of principal and interest payments, and the annual cost of paying off the bond. I suppose a lot of people don't bother to read that and just vote based on TV ads or signs instead, but it's not as if the information is hidden from them. For that matter, private interests can and do put bond measures onto the ballot as well. In 2008 there was one proposing the state issue about $2 billion in bonds to build children's hospital facilities, which passed. All the major campaign donors were hospitals, but I'm sure that's just a coincidence.

protomyth 16y ago

Some of the (smaller) banks actually didn't want to lend. They were sued by some organization for being too strict in their lending requirements.

anigbrowl 16y ago

Yet when a bond measure is passed no one spells out the terms. No one makes sure they know how much they'll pay in taxes each month after that to pay off the bond or how much total interest will be paid. Why do you say that? Every time I see a bond measure on the ballot, there's an estimate of the fiscal impact from the Legislative Analyst's Office in the voter information pamphlet, showing the relative costs of principal and interest payments, and the annual cost of paying off the bond. I suppose a lot of people don't bother to read that and just vote based on TV ads or signs instead, but it's not as if the information is hidden from them. For that matter, private interests can and do put bond measures onto the ballot as well. In 2008 there was one proposing the state issue about $2 billion in bonds to build children's hospital facilities, which passed. All the major campaign donors were hospitals, but I'm sure that's just a coincidence.