<html xmlns:v="urn:schemas-microsoft-com:vml" xmlns:o="urn:schemas-microsoft-com:office:office" xmlns:w="urn:schemas-microsoft-com:office:word" xmlns:m="http://schemas.microsoft.com/office/2004/12/omml" xmlns="http://www.w3.org/TR/REC-html40"><head><meta http-equiv=Content-Type content="text/html; charset=utf-8"><meta name=Generator content="Microsoft Word 15 (filtered medium)"><style><!--
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</o:shapelayout></xml><![endif]--></head><body lang=EN-US link=blue vlink=purple><div class=WordSection1><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><o:p> </o:p></p><div style='border:none;border-top:solid #E1E1E1 1.0pt;padding:3.0pt 0in 0in 0in'><p class=MsoNormal>> <b>On Behalf Of </b>Dylan Distasio via extropy-chat<br><b>Subject:</b> Re: [ExI] you'll never see this again<o:p></o:p></p></div><p class=MsoNormal><o:p> </o:p></p><div><p class=MsoNormal>>…Yes, states are going to be in a terrible spot, and something will have to give…<o:p></o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal>It isn’t just states. Governments at every level are dependent on tax revenue which comes from money changing hands.<o:p></o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal>>…Look for getting taxed to death before spending cuts though!<o:p></o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal>Ja I see your reasoning, however… raising taxes during a downturn is nearly impossible. Revenues will drop regardless of what government does at any level. Our city is putting a new quarter cent sales tax measure on the ballot, but the budget shortfall will scarcely notice. Cities can borrow money, but that sounds risky to me: we already have a local city that went bust (Vallejo.) They were in Chapter 9 for nearly three years.<o:p></o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal>California (and a lot of its cities) are in even worse problems. We can vaguely imagine a city with a 15% budget shortfall needs to lay off 15% of its workforce, however it doesn’t really work that way. They have pension obligations which may depend on current funding, and they have some state and federally mandated services. They might need to lay off 30% of their staff to make a 15% budget cut.<o:p></o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal>spike<o:p></o:p></p><p class=MsoNormal><o:p> </o:p></p></div></div></body></html>