$26 billion bailout of state and local government overspending

by Kristina Rasmussen Congress is on its way to passing a $26 billion bailout of state and local government overspending. States like Illinois can’t afford to fund the costly Medicaid benefits and plush public employee union contracts they’ve bestowed, so the federal government is stepping in to fill the gap. Illinois is slated to “get” over $1...

by Kristina Rasmussen

Congress is on its way to passing a $26 billion bailout of state and local government overspending.

States like Illinois can’t afford to fund the costly Medicaid benefits and plush public employee union contracts they’ve bestowed, so the federal government is stepping in to fill the gap. Illinois is slated to “get” over $1 billion from Sugar Daddy Uncle Sammy. Never mind that our kids – and their kids – will be on the hook to pay it back.

Who can we thank for this “munificence”? Look to the Maine duo:

Union-backed advocacy groups produced ads this week urging Republican Sens. Susan Collins and Olympia Snowe of Maine to cross over and support the measure. Both did, giving Democrats the 61-38 super majority they needed to invoke cloture and clear the way for final passage.

You can also “thank” the unions.

“This money doesn’t appear on trees,” said Sen. Judd Gregg of New Hampshire, the top Republican on the Senate Budget Committee.

They also suggested saving teachers” jobs was payback to education unions who support Democrats.

“When you go to the essence of what this bill is about, it’s to pay off education unions,” Gregg said. “Let’s not be coy.”

Remember that the stimulus’s “aid” for states came with some troublesome strings that tied the hands of would-be budget balancers. I wouldn’t be surprised to see the final version of this bill contain so-called “maintenance of effort” clauses that prohibit expenditure reductions in these areas now or in future years. This effectively removes pressure from state legislators to enact spending reforms while heightening the calls for tax hikes.

A federal bailout of state profligacy is becoming an annual occurrence.