Shocker: Now California wants “free” government money

Victor Joecks

government's free money is a trap, but politicians want more

If the federal government is giving away money, why would any business/organization/state not try to get in line?

First came the banks and insurance companies. Then the auto industry. Now, with California on the verge of financial collapse, state leaders are demanding an unprecedented federal rescue of their own.They say they need the Obama administration to step in and back billions of dollars in emergency loans. If Washington fails to do so, the state could start running out of cash in July and then would have to stop paying huge amounts of its bills. That, in turn, could set off dangerous ripples throughout the economy, state officials say.

The argument is familiar. Just like AIG and General Motors, California says it is too big to fail.

This wouldn’t be the first time the federal government has given away money to states, either.

We had a situation in 1932, with America’s first federal welfare program, where we allowed states to come to Washington seeking “their share” of the $300 million in federal aid that Congress made available. The result was that Illinois politicians practically ran to Washington to grab more that $55 million – almost 20 percent – of the national total, while Massachusetts, Connecticut, and Nebraska received nothing. Once we open the federal treasury to states with alleged needs, then some states will rush to Washington with all sorts of needs, real and imagined, and ask for all U. S. taxpayers to contribute.

How much better it is for each state to clean up its own problems, as the Constitution requires.

When will it end? If the government stays involved, it won’t. Government intervention in the economy keeps growing and growing.

This is exactly why the government shouldn’t pick the winners and losers – be they businesses, states or individuals. Individuals and organizations need to face the consequences of their bad decisions, not be rewarded for them. If the government rewards bad decisions, all we’ll end up with is more bad decisions.