The short answer to the question, "Is California bankrupt?," is no. States cannot declare bankruptcy.
The San Francisco Chronicle explores the question, and it comes up with some chilling answers.
"California is deeply in debt. You could say that it's bankrupt" is what former and perhaps future California governor, Democrat Jerry Brown declared.
Republican Senate candidate and former Hewlett Packard CEO Carly Fiorina says the tarnished-state is "literally bankrupt."
Fiorina compares California's troubles to a family living with a mortgage, no savings, and maxed-out charge cards.
California's deficit for the next 16 months is $20 billion, one quarter of its budget. That deficit exceeds what the tarnished-state spends annually on higher education and prisons--combined.
CalPERS, the state's public pension fund, currently has $16.3 billion more in liabilities than assets, and California, again according to the Chronicle, has a $51 billion health and dental care bill for its retirees.
That is real money.
State Comptroller John Chiang, a Democrat, says California is "not functionally bankrupt."
But if California goes into default, as Cleveland did when Dennis Kucinich was mayor, the hoi polloi, and the misinformed media, are likely to call it a bankruptcy. Technically wrong, but the perception will be there. While Kucinich was running for president, he had to regularly remind voters that Cleveland did not go bankrupt during his tenure at city hall.
Disclosure: I went to grade school and high school with Chiang.
Marathon Pundit's California Collision
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