Every month we devote posts to just general political class insanity that is running rampant through the country. The members of the American political class continue to show that they are incapable of efficiently operating any level of government in this country.
Even their best efforts are almost always ineffective at resolving any problem facing Americans. They spend a great amount of time not trying to improve the lives of their citizens but continually ensuring their reelection and enriching themselves, their families, and their friends in the process, all at taxpayer expense.
1)We have often discussed the reality that pretty soon a major U.S. city or an entire state government will go bankrupt. The mismanagement and minimal budget skills of the politicians running these cities and states has resulted in a serious out migration of residents and businesses to other locales that have lower tax burdens, business friendly regulations, lower crime rates, and a better quality of life.
This out migration causes the tax base to shrink which reduces the tax steam and since most opticians never cut spending or make government more efficient, they have to raise tax and cut services. This drives more residents and businesses away and the financial death spiral is underway.
Our top state candidates to go bankrupt include New York, New Jersey, Illinois, and California with other states in trouble but in not nearly as bad financial shape as the top candidates. Our top cities to go bankrupt include New York City, Chicago, Los Angeles, San Francisco, and maybe Portland and Seattle.
The leaders in this race to bankruptcy court vary over time as financial crises arise. However, given what is going down in Chicago, we think that city has taken the lead in the race of financial insolvency:
Chicago has very high taxes to begin with.
It also has seen a large out migration of residents and businesses as a result of high taxation and rampant crime.
But things recently got much worse as a major Wall Street ratings agency, S&P, downgraded the city’s credit while at the same time pointing the finger of guilt at the current mayor, Brandon Johnson, and the city council.
A lower credit rating means that Chicago will have to pay higher interest rates on any municipal bonds the city issues which raises the cost of serving that bond and increases the expenses of the city.
According to S&P, the city politicians created a budget spending plan for 2025 that created “a sizable structural budgetary imbalance” that will only make the city’s financial situation worse.
The city’s credit rating was lowered to BBB which means that the city has an “adequate capacity to meet financial commitments” but is vulnerable to “adverse economic conditions.”
The BBB rating is only two steps above junk bond rating.
According to S&P’s Scott Nees: “The downgrade reflects our view that the 2025 budget leaves intact a sizable budgetary imbalance that we expect will make balancing the budget in 2026 and outyears more challenging.”
The city politicians were almost not able to close a $982.4 budget deficit for 2025 but left it in danger of not being able to have a viable budget in 2026 and beyond, i.e. they did not make the necessary spending cuts that were necessary to cope with a shrinking tax base.
Specifically: “The city’s practical options for raising new revenue appear less certain, as does the willingness of city leadership to cut spending, creating a level of uncertainty around its financial trajectory that is more appropriately reflected in the lower rating.”
The mayor, not surprisingly, criticized the downgrade, claiming that the city has “fundamental economic strength.”
But the city still has many underfunded pension and other obligations, residents and businesses continue to flee the city, crime is still rampant, and now the world knows that Wall Street is not happy with the financial outlook of the city government. Yes, it looks like the city of Chicago is now in a financial death spiral and is now our top city candidate to go bankrupt first.
2)Speaking of corruption, let’s go halfway around the world to Ukraine:
As most people know, the Ukranians have been fighting the invading Russian army now for almost four years.
Also, as most people know, Joe Biden had no plan, no strategy and even worse, made no effort to end the conflict.
Insead he just kept writing checks using American taxpayer money and sending it overseas with the intent to help the Ukranians save their country from the invaders.
The cost of his inability to negotiate and lack of energy to do so has probably cost the American taxpayer about $200 billion so far, the amount of money Biden sent to the Ukrainians that was supposed to be used to beat the Russians.
This is wasted money that could have been a great help to helping millions of Americans that are homeless, hungry, need medical care, and relief from many natural disasters.
But it gets worse, according to ex-Polish deputy minister Piotr Kulpa.
Kulpa claims that up to half of the funds that reached the Ukrainian capital were stolen by Ukrainian officials.
This is not out of the realm of possibility since the country has a long history of alleged corruption within the government.
Specifically: “But they will also find something else: that a huge portion of the funds was stolen in Ukraine. From 30% to 50%, regardless of the nature of the aid.”
He also said that U.S. foreign programs are a way to “write off large sums of money that finance shady systems under the Democratic Party’s control,”
Also, he claims that the public figure of aid that was supposedly sent to the Ukranians was nowhere near what was actually delivered and used for the purpose of beating the Russians.
A lot of the money was siphoned off to pay the sky high salaries and bonuses of senior Ukrainian government politicians and officials.
Given that Federal government programs like the covid relief programs, Social Security, Medicare, and just about every other government function is rife with fraud, criminal activity and stupidity, this assertion by the Polish official should not surprise us, just another day to rip off the American taxpayer, or as Mr. Kulpa says: “It’s a spit in the face of every Ukrainian. To every European and American taxpayer. This system is criminal from start to finish.”
Follow up note: A recent report from the Pentagon Inspector General, Robert Storch, said existing Ukrainian corruption “continues to complicate Ukraine’s efforts to achieve its EU and NATO aspirations.”
3)So political class incompetence is alive and well in Chicago and D.C., which should not surprise us when we look at the most recent Gallup trustworthy survey:
On a regular basis, Gallup polls Americans on how they judge the honesty and ethical standards of various professions.
The least trusted professions recently turned out to be lobbyists, members of Congress, and TV reporters.
More than half of those surveyed said these professions have low or very low ethics.
Only 13% of respondents had a high opinion of TV reporters who ranked higher than Congressional members and lobbyists, which means less than 13% of those polled had a high opinion of them.
Only 8% said they had a high opinion of Congress and only 4% had a high opinion of lobbyists.
And why Congress is rated very low, the mainstream media/TV reporters are on a very bad trend since in 1972 Gallup found that the media was rated highly by 69% and today that 69% has slid to 31%.
So Americans do not trust their members in Congress or the media TV reporters that cover them, leaving us in deep trouble from a democracy perspective: politicians stink at their jobs and we do not trust mainstream media types to tell us about their failures and corruption. Dangerous times.
Just another day of insanity: Chicago takes the lead in the bankruptcy race, another government program that wastes billions of taxpayer wealth, and no one merits a bit of our trust.
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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
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