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I agree with McConnell that states should be allowed to go bankrupt

But only under these conditions:

  • The state immediately surrenders control to federal managers appointed by the President, including a federal Governor.
  • The federal managers will serve for a minimum of five years, or longer if deemed necessary by the sitting President.
  • State employee unions are immediately decertified and banned from attempts to re-organize state employees in perpetuity.
  • Within 30 days, the management team identifies non-essential state employees and terminates them.
  • Within 60 days, the state curtails non-essential spending as defined by the federal management team.
  • After 180 days, but within one year, the state holds special elections for governor and all state legislators.  The incumbent office-holders (that is, those incumbent at the time of the bankruptcy declaration) are not allowed to run for re-election, and are banned from running for office for ten years.  The new office-holders may resume the business of the state, but the federal managers have a veto on anything they do.
  • Within two years, a plan to convert all future state fixed pensions into 401(k) plans is to be put in place.  Current state pensioners may continue to collect their pensions at a reduced rate, have their existing pension converted at a reduced rate to IRAs, or take a one-time reduced rate payout in cash.  All rates to be determined by a special committee of the federal managers.
  • Before the end of the minimum five year term of the federal managers, the state code is to be revised to remove any laws or ordinances which conflict with the Federal Constitution and the Bill of Rights.
  • The state constitution must be amended to include a balanced budget provision and penalties for state officeholders who flout it.

Seems like a start to me.