AN EASY PLACE TO BEGIN

A major part of the Fin Reg argument was to create a new set of rules whereby nothing was "too big to fail" and taxpayer money would never again be used to bail out the private sector. Did the second 2000 page piece of junk produced by this Congres in the past year accomplish that? Of course not, but at least we did seem to have reached a national concensus on the two main principals stated above. So now that we are all in agreement let see if we can apply this piece of solid thinking to a problem so massive and so dangerous as to demand immediate attention. Public debt...not in the Federal Sector but within the states.

Our buddy Paul Krugman has told us that "we are not Greece." Little Paulie is right of course but as usual, he has no idea about what he is right. We are not Greece but California, Illinois, New York and New Jersey are, not to mention a few other noble examples of politicians gone wild. Can't we simply agree atb this time that Federal tax dollars are not going to be available to cover the debts owed by soverign states within our Federation? Why should Indiana or Iowa taxpayers cover Illinois? If the problem is one of national fiscal prolificacy would it not be easier to solve the problem first at the state and local level than at the much more complex level above? My goodness you say, that would ruin those states in question! So what. Ruination is before them and the nation as a whole. Better now than yet to come (to manhandle the Bard) because you see, I am coming at this from the standpoint of laying a foundation for the future growth we must have in order to survive and bail-outs will do NOTHING to fundamentally fix the structural wreck in which we find ourselves. And make no mistake, it must be fixed.

In the 1970ies, New York City found itself in very much the same sort of fiscal state as many states find themseves today. A bail-out was sought ( a stimulus bill?) resulting in the famous headline in the New York Daily News: "FEDS TO N.Y.: DROP DEAD." New York didn't die. The cure was awful, the pain terrible but it didn't die. Services were slashed, salaries were cut, people were fired, and the City emerged more powerful, more together, more proud and more of a world leader than ever before. There was a sign at the departure point of La Guardia airport that was put up just about then: "When you leave New York, you're goin' nowhere." What incredable cheek, but you know what? We believed it. We had survived. We could make it anywhere.

Gotta start somewhere. THis is the easy part. We'll deal with the tough stuff in later entries--which may be delayed by the home opener coming up this Saturday. Rah, rah, sis boom bah! Stay tuned.