The city manager of Stockton, California is expected to file bankruptcy papers on behalf of the municipality – making it the largest city to seek bankruptcy protection. Stockton has more than $700 million worth of bond debt.
The following statement from Steve Stanek, research fellow for budget and tax policy at The Heartland Institute – a free-market think tank – may be used for attribution. For more comments, refer to the contact information below. To book a Heartland guest on your program, please contact Tammy Nash at [email protected] and 312/377-4000. After regular business hours, contact Jim Lakely at [email protected] and 312/731-9364.
“I don’t think anyone has more clearly described the cause of Stockton’s bankruptcy than City Manager Bob Deis did in an interview with Time magazine several months ago: ‘Stockton overcommitted to long-term obligations that even under the best of times the city could not afford.’
“These obligations include lavish pay and perks for local government workers and corporate welfare masquerading as local economic development. I hope people in other cities throughout California and the nation learn the lesson Stockton presents. Public servants should not receive wages and benefits more generous than those available to people in the private sector, and economic development should be done by private businesses using their own money, not local taxpayers’ money.”
Research Fellow, Budget and Tax Policy
The Heartland Institute
Budget & Tax News
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