NPR played an interview with a potential voter this a.m. “I am glad she [Bachman] is running, she will bring common sense to the race.”
Morning Marketplace announced this a.m. that New Jersey’s Governor Christie is negotiating an open credit line to J.P. Morgan for $2.25 billion dollars. If the State needs more dollars it will just borrow it from the bank. NPR said this was OK because they took out a $2 billion dollar credit line before but never had to use it. They criticized the bond process because it was a long, difficult process. YES, but it is for a good reason.
Let it first be understood, that states are not permitted to run a deficit. By federal law, their books MUST balance. If and when the state does borrow, by selling bonds, It first must tell the public what the express purpose for the bond is and then submit it for voter approval, before the bonds can be sold. The reason for the approval is that the bond obligates the taxpayer to pay it off. It is NOT part of The Budget, as it were.
The credit line, on the other hand does not require the public to approve it’s use and it can obligate the state beyond its ability to pay it off that year—by definition. When the bank cannot pay, what claim will the bank have on the State’s assets? Has the governor created this crisis by reducing tax rates on the rich or on corporations, like they have here in FL?
This plan is too wrong for too many reasons and NPR paints it as a good solution. Has FOX News taken over NPR?