California's budget woes are the result of gross fiscal irresponsibility. And at this point there is only one realistic cure: bankruptcy.

There is a beauty in bankruptcy. Strange words, I know, but it's true. As an example, there is the story of an old friend of my father's, a man who at one point in his life was a compulsive gambler. Oh, he was a heck of a nice fellow, but a slave to his vice. He used credit to fund his rolls of the dice and he spent and spent and spent until there was nothing left to spend. Then, awash in insurmountable debt, he finally had to declare bankruptcy.

While this gentleman should never have been extended the credit he had in the first place, the point is that he eventually was disciplined by the system. And I suspect that in some small way it made him a better person. After all, at least he was no longer wiling away endless hours in a bad environment playing games of chance.

I think of this when hearing about how California is staring bankruptcy straight in the eye. The Golden State has been spending like the Prodigal Son, but don't hold your breath waiting for any repentance. The best predictor of future behavior is past behavior, and irresponsible California voters and the like-minded politicians they elect have long behaved as if money grows on sequoias. So what is the solution? Should we let economic nature take its course and allow the state to go bankrupt? Or, as is all the rage today, should we bail it out through the federal government? Siding with common sense, columnist Megan McArdle chooses the first option in a piece titled "Is California Too Big to Fail?" writing:

. . . I don't really see another way out of it. If Uncle Sugar bails out California, California will not fix its problems. Perhaps you want Obama to make it fix the problems, using the same competence, power, and can-do spirit with which he has repaired all the holes in the banking and auto manufacturing sectors. But Obma [sic] is not in a good position to do this. California Democrats are a huge part of his governing coalition. All Obama can do is shovel money into the bottomless pit of California's political system.      

Unfortunately, because Prodigal State Democrats are part of Obama's coalition — and because accountability and cathartic pain are now unfashionable — it's likely that Uncle Scam will just throw bad money (legally counterfeited) after worse right down the San Andreas Fault. Yet this couldn't change California's behavior any more than it could change that of Chrysler, GM, the banks or my father's friend.

Really, though, one of the main reasons for all these bailouts is that aversion to accountability. We have become a bailout culture.

This manifests itself in innumerable ways. Parents and teachers bailout children when refusing to hold them accountable. We bailout people who insist upon building homes in flood-prone areas with "disaster relief." We bailed out rich people after 9/11 so they could continue living lives of silk and satin with money taken from the wash-and-wear set. The truth is that — except for those who commit our newly-minted secular sins (such as expressing politically-incorrect Truth) — there is no desire to hold anyone accountable. Americans have forgotten a pearl of wisdom expressed so eloquently by English philosopher Herbert Spencer: "The ultimate result of shielding men from the effects of folly is to fill the world with fools."

A type of bailout partially responsible for California's problems — and one the bold commentators in the mainstream media are loath to mention (why are newspapers failing again?) — is the treasure spent on hordes of illegal aliens leeching off the California government. Open-borders apologists try to muddy the waters on this, as they talk voters dizzy with blather about taxes illegals allegedly pay and this or that statistic, but this isn't hard to understand. The poor qualify for and use government services to a massive extent; thus, if you import millions more poor people and allow them access to these services, well, just make sure your red marker is filled with ink.

Yet there are those who, for a variety of reasons, want to bail out illegals. Now, I'm all for helping the poor, mind you; for example, it's great that churches provide charity here and abroad. But should government exceed its legitimate role and become a secular church dispensing money forcibly extracted from taxpayers? Is the illegal alien population "too big to fail"? California's citizens have to decide whether or not they want their state in the charity business, turning their terra firma into a flop house, medical clinic and food pantry for the world. Because that's what they have become.

California should be allowed to sink under the weight of its own über-statism. As with a business, such a consequence may be the only thing that will force some necessary restructuring. We should also bear in mind that while it may be possible to fill the world with fools, the whole world cannot be bailed out. Someone will be left holding the bag. In other words, the problem with continually bailing out the irresponsible is that you eventually run out of the responsible's money. Thus, the end result of rescuing all the feckless, great and small, is that our nation will bankrupt itself, and we will find out that America is not at all too big to fail. And will Russia, China and the European Union catch our fall? Right now foreign nations are propping us up, as we are indeed viewed as too big to fail. But what will happen once the world no longer has a vested economic interest in our survival? Will America end up like a Chapter 7 business, with her assets falling into the hands of the more responsible? I don't know. What I do know is that there's no such thing as too big to fail — only too bloated to prosper.

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Natalia said:

	... there is no beauty in bankrupcy!
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May 22, 2009
Votes: +0

John Q Public said:

And the loser is....... The previous poster obviously didn't read the article, or he/she would have understood the writer's point...which is that if California fails, it will be punished through bankruptcy. This to an extent is true, except that those responsible for the current California crapola, won't face personal responsibility, only a collective responsibility that will make it herder for California to issue bonds and so forth. But at the end of the day, no one will touch the bank accounts of the individuals who make up the government of the Golden State. Additionally, even if California goes through bankruptcy, bankruptcy may be seen as just another bailout in which creditors are left holding the bag (to a lesser extent). This results in the creditors simply raising fees for the rest of us, and so in the end, the person left holding the bag is John Q Public. (Who else?) What then is the answer? Obviously, send the entire California Legislature and the Governor to debtor's prison, an make them work to pay off the debt :).

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May 22, 2009
Votes: -1

Robert Rudolph said:

Many are to blame I've lived in CA all my life, 44 years to be exact. I know very well what has caused the problems in this state. And I do believe the state should go bankrupt so it can start over. Stop handing out money to the illegal aliens, reduce taxes to encourage contributors to come here and/or stay, abolish collective bargaining for state/city employees, and make some changes so that voters can't say YES to every bond act that's presented to them. Yes, bankruptcy is a great route for CA.

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May 23, 2009
Votes: +1

Craig L. Combs said:

	No Bankruptcy for States Bankruptcy is a creature of statute. There are no bankruptcy provisions for states - only for municipalities. So all this talk about California (or any other state) going "bankrupt" is nonsense.
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May 23, 2009 | url
Votes: +3

us and them said:

	... It may clean the slate fiscally but will they learn they're lesson and be more fiscally responsible? I don't think so. It will be a excuse for the left to go on another spending binge. Only the total collapse of our economy will stop these traitors to the constitution.
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May 29, 2009
Votes: +1