WC Varones

Don't lend your hand to raise no flag atop no ship of fools

California seeks $6.9 billion federal bailout

... and that's on top of the $20+ billion unemployment insurance fund bailout. The WSJ has the story.

California is still screwed whether or not it gets $6.9 billion to scotch tape this year's budget. But the thing it illustrates is how out of control the Federal government is. $6.9 billion is a hell of a lot of money even for a state as huge as California. But it's trivial compared to the amount of money Obama and Bernanke are throwing around. It's less than one percent of Obama's $787 billion porkulus package which accomplished exactly nothing! And it's less than one percent of the trillion-dollar deficits Obama plans to run in perpetuity. And it's less than one percent of the money that Bernanke has created out of thin air to bail out Wall Street.

Just a little perspective for you.


Jr Deputy Accountant said...

I also read on the cover of the smaller, more expensive SF Chronicle that California is scrambling to be at the top of the list of the public school bailout, assuming that somehow they can make it from 49th in the nation to 1st in the nation overnight just to get some of that good bailout cash.

LOL! That was great for a good laugh.

(as a mother of a child in California's public schools, the laughter did not last very long)

Anonymous said...

Despite all this cash being thrown around, we have negligible inflation?!?

W.C. Varones said...


I think we have negligible inflation now because of declining demand, excess capacity, and credit contraction.

But printing trillions and deficit-spending trillions is certain to cause future inflation, and once it gets started it will be impossible to stop.

I think how it will play out is that we'll see commodity inflation before wage inflation, which will destroy the working and middle classes as their paychecks can't keep up with the cost of gas, food, and home heating.

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