It's a statewide concern. California cities, counties, special districts and redevelopment agencies owed $185 billion in outstanding debt in 2008, about 55 percent higher than the amount of outstanding debt on their books in 2000, according to data from the state controller's office. Those figures do not include school districts, which saw an even bigger jump in debt.
Much of the new debt statewide was put to good use, said Tom Dressler, a spokesman for the state treasurer's office. "Our infrastructure was built to support 25 million people," he said. "We'll have 60 million by 2050."
Still, said Dressler, some local governments may have bitten off too much when times were good. "You've got to be smart and exercise good judgment," he said. "You've got to think about the long term."
Mandy Morello doesn't believe her local school board did much long-term thinking before putting two large bond measures in front of voters several years ago.
Proponents of Measure J in the San Juan Unified School District pointed to leaky roofs and dilapidated trailers when asking voters to approve a $350 million bond package in late 2002, promising about $4 million for each school. Four years prior, the district cited outdated wiring that hampered computer access when asking voters to pass Measure S, a $157 million bond measure.
The pitches worked, with voters overwhelmingly agreeing to pay an extra $85 in property taxes per $100,000 in assessed property value to fund the bonds. And the district followed through, pouring millions into nearly every school.
Then, it closed 10 of those newly improved schools between 2004 and 2009 because of declining enrollment, instituting a game of musical chairs that has required a lot of students to transfer, some more than once.
What is my point here from the viewpoint of QM Theory? What these lawmakers do is a very expensive process of balancing the government channel, (a Recalculation) making the government channel from Federal to State to Local look like a Shannon channel, optimized for the greatest throughput. Notice they try one thing, upgrading schools, then a combination of low state funding and changing demographics mean closing those very schools. They are still stuck with the debt. Local officials have to deal with local operations and they have little advanced warning about state or federal changes.
The current Congress has restarted this entire search for balance process by reforming health care. Good or bad, Obamacare is a equilibriation process, a shifting of space on the government yield curve between state, local and federal government. How long will this equilibriation take? Probably two election cycles. four to six years before government gets anywhere close to balance.
Is this government restructuring worth the cost? No one knows, conditions have been set and it will four years before we get an inclination of the outcome. But the more serious problem is that this government rebalance runs up against the Wall of Maturity that Congress has gotten itself into, with some $5 trillion in debt due to mature over the next five years,
The shit is still hitting the fan for American government.
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