The Race To Bankruptcy Court: Florida Kicks Illinois's Financial Butt and California Has Mega Budget Problems

Let’s return to one of the hottest topics we have been covering over the past few years, coverage that has intensified recently: which major city or state government will get to bankruptcy court first? Our primary cities it he race to bankruptcy include New York City, Chicago, Los Angeles, San Francisco, and newcomer, Seattle. The state governments that we think are soon heading into bankruptcy include New York, New Jersey, Illinois, and California with Washington state a newcomer to the race.

Before reviewing the latest news and seeing which state or city is making the best progress towards government bankruptcy, let’s review how these cities and states got themselves into this financial death spiral position to begin with:

• A government entity keeps expanding its budget, eventually putting pressure on the tax revenue stream it receives.
• At some point, rather than cut government spending or make its programs more efficient financially, the politicians in charge raise taxes to meet the ever growing government expenditures.
• The raising of taxes causes some residents and businesses to leave the city or state for less tax burdensome areas, reducing the tax base and reducing the revenue stream.
• Rather than cut expenses and become more efficient to match the reduced tax revenue stream, politicians in the above cities or states raise the tax burden even more.
• This causes more residents and businesses to flee the city or state, further reducing the tax base and tax revenue stream.
• At some point politicians panic and raise taxes more and start cutting vital government services (e.g. police, fire, education) in order to try and balance government spending against the shrinking tax base and revenue stream.
• The reduction in quality of government services in particular and quality of life in general drives more residents and businesses out of the area.
• Eventually, the expenses, costs and financial liabilities outstrip the reduced tax stream and bankruptcy occurs.

Okay that’s the process, now lets check the progress some of the above listed government entities are making to achieve this bankruptcy goal against this process:

1)The following statistics come from a tweet by the Rush Limbaugh News account so judge their accuracy accordingly. However, other data sources verify these general trends and realities. The format is positioned as a “scoreboard:”

Florida under Governor Ron Desantis:

• Lowest crime rate in the state in 50 years.
• #1 in state economic growth three years in a row.
• $10 billion in tax relief since 2019.
• Paid down 50% of existing state government debt.
• 3.7 million new businesses created.
• Working to eliminate or significantly reduce residential and business property taxes

Illinois under Governor JB Pritzker:

• $145 billion in pension debt, highest in the country.
• $3.2 pending budget deficit in 2026.
• Budget deficit is predicted to grow to $5.2 billion by 2029.
• Oversaw $5.2 billion in fraudulent unemployment benefit payments.
• Ranked 50th out of 50 states for financial transparency.
• 7 straight years of illegal financial reporting delays

The tweet summed up the difference between a state in a robust growth mode and a state racing towards bankruptcy court: “DeSantis asks: how do we put more money in your pocket?? Pritzker asks: how do we balance our books? That's the difference between a conservative and a Democrat.”

Note: The tweet did not mention that Florida does not have a state income tax while Illinois has a state income tax north of 4% and Florida does not have an estate tax while Illinois does, more reason why residents are fleeing Illinois.

2)Let’s head out to California and see how that state’s budget and fiscal woes are coming along:

• Governor Gavin Newsom recently bragged that the state government budget had been balanced and there was “zero structural deficit through July 2028."
• Sounds good but smart people looked at the state's economic situation and said things are not that rosy.
• According to Rachel Ehler of the state’s Legislative Analyst’s Office (LAO): “Despite these booming revenues, the state’s underlying fiscal condition, in our assessment, is not sound. We continue to have a structural deficit.”
• She claims that structural budget deficits still exist for the next two fiscal years.
• She went on: “Really, the only way the budget proposal before you is balanced is by relying on reserves.”
• In other words, the budget is balanced only because money had to be taken out of basically a rainy day fund, a fund that will deplete at some point in time.The real budget deficit could be as high as $16.9 billion according to the LAO.
• And these budget deficits are still around despite record revenue growth, i.e. state government expenses are growing faster than robust revenue growth.
• The California Budget and Policy Center chimed in with the opinion that structural budget deficits are still going to come true "without additional action.”

The bottom line is that the California state budget situation either has to see massive cuts in spending or more taxation. In either case, less government spending or more taxation or both, businesses and residents will continue to leave under these conditions, taking their tax base and economic power  with them.

3)As we have discussed, one of the most inane tax ideas that might happen in California, is a one time 5% tax on the wealth of billionaires living in the state. This tax is supposed to be one time and generate $100 billion.

Also, as we have discussed, billionaires have already started to leave the state for more tax friendly states like Texas and Florida, states that not only do not have a state income tax but also have absolutely no plans to tax wealth. These fleeing California billionaires are not only taking the theoretical wealth tax revenue with them but are also taking any current taxes they are paying the state government, a double whammy to the state budget.

The National Taxpayers Union Foundation recently had some interesting, and distressing views, on the California wealth tax:

• The Foundation analysis noted that billionaires have already left the state in anticipation of a wealth tax including Larry Page, Sergey Brin, Peter Thiel, and David Sacks.
• It is estimated that fleeing billionaires have already taken $700 billion of wealth out of state and a hefty amount of now missing state income tax.
• The analysis estimated that before the exodus is down, a trillion may have left the state.
• But apparently the $100 billion upside wealth tax revenue was based on the number of billionaires and their wealth before the exodus began so the $100 billion estimate might already be way too high.
• The proposed wealth tax is currently expected to be retroactive, i.e. anyone living in the state as of January 1, 2026, would be subjected to the tax even if they moved before the tax was enacted into law.
• However, the Foundation points out that this maneuver is likely to be viewed as a violation of the Due Process tenet in the Constitution so that even if a billionaire leaves after the January 1, 2026 deadline the state of California probably has no way to go get them.
• The Foundation analysis pointed out that California, according to IRS data, lost a net 1.6 million residents over the past few years, taking about $12.7 billion of state and local tax revenue with them so the exodus is well underway and does not include just billionaires.
• As we have proposed, the state government of California is in a financial death spiral: the state politicians refuse to axe government programs or make them more efficient, they are raiding rainy day funds to balance the short term budget, and they do not understand that the state is losing residents and businesses because of higher and higher taxes and lower and lower quality of life.
• The Foundation's analysis summed up the feeble financial situation in the state quite nicely: “Seventeenth-century French finance minister Jean-Baptiste Colbert is supposed to have defined taxation as “the art of plucking the goose so as to obtain the greatest amount of feathers with the least amount of hissing.” Thus far, this proposed tax [wealth tax] is succeeding in maximizing only the hissing, with no feathers at all to show for it.”

That will do it for today: life is good in Florida, life is going south so to speak in Illinois, and California has some serious financial problems that a rainy day fund can keep under wraps for just a little while.


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If you agree that we need to deseat every member of Congress for their lack of success and accomplishment, then please consider going to the following petition link to help the cause:

https://www.change.org/p/deseat-congress-reset-freedom

**********************

Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:

https://www.amazon.com/Love-My-Country-Loathe-Government/dp/1604942789/ref=sr_1_1?dchild=1&keywords=love+my+country%2C+loathe+my+government&qid=1607716020&sr=8-1

Please visit the following sites for freedom:

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http://www.openthebooks.com

http://www.conventionofstates.com

The Race To Bankruptcy Court: Toothless in LA, Restroom Priorities in Seattle, More Taxes In New York and More

 Let’s return to  one  of the  hottest topics we have been covering  over the past few years, coverage that has  intensified recently:  which major city or state government will get to bankruptcy   court first? Our primary cities it he race  to bankruptcy include New York City, Chicago, Los Angeles,  San  Francisco,  and newcomer,  Seattle. The  state governments that we think are soon heading into bankruptcy include New York, New  Jersey, Illinois, and California  with Washington state a newcomer  to the race.

Before reviewing the latest news and seeing which state or city is making the best progress towards government bankruptcy, let’s review how these cities and states got themselves into this financial death spiral position to begin with:

• A government entity keeps expanding its budget, eventually putting pressure on the tax revenue stream it receives.

• At some point, rather than cut government spending or make its programs more efficient financially, the politicians in charge raise taxes to meet the ever growing government expenditures.

• The raising of taxes causes some residents and businesses to leave the city or state for less tax burdensome areas, reducing the tax base and reducing the revenue stream.

• Rather than cut expenses and become more efficient to match the reduced tax revenue stream, politicians in the above cities or states raise the tax burden even more.

• This causes more residents and businesses to flee the city or state, further reducing the tax base and tax revenue stream.

• At some point politicians panic and raise taxes more and start cutting vital government services (e.g. police, fire, education) in order to try and balance government spending against the shrinking tax base and revenue stream.

• The reduction in quality of government services in particular and quality of life in general drives more residents and businesses out of the area.

• Eventually, the expenses, costs and financial liabilities outstrip the reduced tax stream and bankruptcy occurs.

Okay that’s the process, now lets check the progress some of the above listed government entities are making to achieve this bankruptcy goal  against this process:

1)Today’s discussion will focus a lot on what the politicians in the cities and states that are heading for bankruptcy are focusing their time on and it is not finding ways to  make government more efficient, more effective, less expensive and  free  of fraud. 

Let’s start out in  Seattle, a late comer to the race to bankruptcy but an entrant that is  making up for lost time:

• Katie Wilson  is the new communist mayor in the city and has made it clear that heavier and heavier taxation is her main way to run  the city government.

• We have  already discussed the horrible attitude she has towards wealthy, highly taxed people that live in the city and the reality that many of them have already left the city to  get out from under the high taxation.

• When asked what that means to the  city, i.e. millionaire taxpayers leaving, she condescendingly said “Bye!” to her exiting tax base.

• We have also  discussed the  reality that a  primary employer in the city of Seattle  has already decided to take 2,000 high paying  knobs out of the  city  and  the state of Washington  and move them to Tennessee.

• Depending on the  source, the office  vacancy rate  in the city for office space is one of  the highest in the country as businesses flee the  city or do not  come into  the city given the high tax burden.

• While all of this is going on, Mayor Wilson recently spent some of her mayoral  time  cutting  the  ribbon on new downtown public restrooms.

• Yes, her tax base  is cratering and this is what she is spending time on public  restrooms.

It is this type of attitude and  priorities that show the remaining taxpayers of the city that maybe getting out of town is a good idea since apparently the good mayor is spending  time on things that are not going to make the city better,  more robust, and less crime filled. But at least going to the restroom in the city is going to be easier.

2)Rob Saka is a Seattle city council member. Prior to Wilson’s election he stated that he was looking forward to partnering with  her if she became mayor and help her build a “thriving,  inclusive Seattle that uplifts working families.”

And yet, less than five months into Wilson’s  mayoral term, even Saka is having second thoughts regarding her priorities, telling the New York Times, “I am  gravely concerned. This is real.” Thus, very quickly even he  recognized that her policies and priorities may not be optimal. Maybe his optimism went  out the  window because:

• She said “Bye!” to any departing city millionaires.

• Starbucks just moved 2,000 jobs out of the city to Tennessee.

• The Washington  state government raised the state estate tax to 35%,  the highest in the country in 2025 before reducing it to a still very high  20% since the state government politicians realized that wealthy people were  leaving the state and the 35% estate tax was  probably a driver.

• The Seattle office vacancy rate was 30% at the end of 2025, a  record high.

• A day spa company is moving out of Seattle to Nashville,  Tennessee because the company’s founder  specifically cited the tax burden in  the state and city.

• Seattle entrepreneur Marc Barros  announced two months ago he was moving his company to Wyoming.

• Jeff Bezos, Amazon founder and billionaire, left  the state of Washington  for Florida in  2023 when  the state government  implemented a capital gains  tax.

• The Tax Foundation  ranked Washington  as  the 45th worst tax state in their 2026 State Tax Competitiveness Index.

• The Columbia Tower Club, a long running gathering tradition  for  executives and civic leaders at the  top of Seattle's  tallest  building, has disbanded.

The warning  lights are flashing brightly: wealthy folks leaving, companies leaving, supporters gravely concerned and the mayor is cutting  a ribbon at a new city restroom.

3)Across the country the same warning lights are flashing brightly in front of the New York state government and New York  City and they are also being  ignored:

• Governor Kathy Hochul  is pushing for a new, additional tax on wealthy people that own a property in New York City.

• This is the same  governor that stated several months ago  that wealthy state residents are moving to Florida to get out from under the heavy tax  burden in the state and city and yet,  she is supporting more of a tax burden.

• This is a so-called  pier-a-terre tax that would  be imposed on luxury second  homes  priced over $1 million.

• NYC  councilwoman,  Councilwoman Joann Ariolae, seems to be  one of the few New York  politicians that gets it: “There’s this mistaken belief out there that people will never leave New York no matter how high taxes go because ‘it’s New York. But people can easily move right across the river to Hoboken, take their tax dollars with them, and still be minutes from Manhattan. What we are seeing here is a short-term solution from the governor in an election year that will have long-term consequences for New Yorkers.”

• According to Ms. Ariolae, New York state is the  worst state for tax competitiveness and  all of these additional taxes are just going to make  it  even worse.

One voice of sanity in a sea of stupidity and idiocy.

4)Illinois is one of our top state candidates to go bankrupt  in the near future. Given this dire  situation, it is  pretty disgusting that a  government employee would waste  limited tax  dollars  in such a blatant disrespect for taxpayer wealth:

• Quintina Brown is the Markham Park District executive director in Illinois.

• She  allegedly used her government/taxpayer funded credit card, wait for it, to book a helicopter  for her daughter’s prom.

• Apparently, her government  credit card number was listed on the invoice for the helicopter.

• The helicopter landed in  Roesner Park in Markham,  Illinois and her daughter, in  prom dress, was on board and ready for prom  pictures.

• City officials  claimed that no official permission was given for the helicopter landing  or rental or to be paid with taxpayer money and  on  the helicopter rental agreement was  Brown’s  signature and government credit card number.

• The helicopter stayed at the park for at least three hours at a rate of $80 for every six minutes beyond  the first hour.

• According  to  Illinois  law,  misusing  government taxpayer money is a Class 3  felony so Ms.Brown may not only get fined but is also possibly facing  prison time.

Makes you wonder how many other zany uses of taxpayer money are being  spent by government  officials while the state hurtles  towards bankruptcy.

5)One last ridiculous waste of taxpayer money that could be potentially spent by a  city on our list heading for bankruptcy:

• Los Angeles is a city in distress and  one  of our top candidates to go bankrupt.

• Crime is high, homelessness is high, businesses  are fleeing the city and state as are residents, the rebuilding of the  city after the  wildfires is almost non-existent, etc.

• There is a continuing budget crisis  and shortage  of tax revenue despite some of the highest state and  city taxes in the  country.

• And yet  Los Angeles mayor, Karen Bass, seems to have  a  different  sense of impotence relative to these issues that affect just about every city resident and business.

• She recently announced that she thought it would be a good idea to use taxpayer money  to provide dental care for homeless meth users since people without good teeth have a hard time getting a  job.

• Free dental  care for addicts using tax money to  fix what these people intentionally induced on themselves.

• Not provide additional mental health services for the addicted homeless, not provide shelter and food for  addicted homeless  folks, not provide drug  addiction  treatment, let’s prioritize fixing  their teeth, a  condition they brought onto  themselves using  taxpayer money.

• According to the  good mayor:  “How many people that you meet that are unhoused don’t have teeth at all?  They don’t have teeth. Why? Because meth rots your teeth. You can’t succeed without teeth. So there needs to be comprehensive healthcare provided to people.”

• So, people that  are taxpaying, non-homeless folks would pay for free dental  care for drug addicts while  they would have to  pay for their own dental care.

• So people that are taxpaying non-homeless  folks who may have  a medical  condition would have  to pay for drug addicts’ dental  care and their own health care to address their own health issues.

Look, I am not insensitive to people with addictions. They need help and  compassion. But fixing their teeth  is a symptom of bigger root causes for their  homelessness and addictions. Taxpayer  money should be directed to fixing the root causes and the bad  teeth problem eventually goes away. 

Without fixing the root causes the bad teeth issue just gets bigger and  bigger every day. And  eventually residents will  realize that their tax  dollars are treating a symptom and will decide that  there  are better places  to live and pay taxes  that make better use of their tax dollars.

Stupid  and silly priorities, be it public restrooms in Seattle or meth rotted teeth in  Los Angeles, the continual  wasting of taxpayer dollars, the inability to  understand basic  economic concepts, i.e. if taxes get too high, the tax base gets lower very quickly. All of which feeds the race to  bankruptcy court.

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If you agree that we need to deseat every member of Congress for their lack of success and accomplishment, then please consider going to the following petition link to help the cause:

https://www.change.org/p/deseat-congress-reset-freedom

**********************

Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:

https://www.amazon.com/Love-My-Country-Loathe-Government/dp/1604942789/ref=sr_1_1?dchild=1&keywords=love+my+country%2C+loathe+my+government&qid=1607716020&sr=8-1

Please visit the following sites for freedom:

http://www.reason.com

http://www.cato.org

http://www.openthebooks.com

http://www.conventionofstates.com