The title of this blog post would certainly lead the reader to believe I’m writing about a play or movie based upon our swine friends of the farm. However, that’s not true in this case. I am instead referring to the European nations of Portugal, Ireland, Greece, and Spain who each, like a porker readied for harvesting, are bloated from feeding themselves into a financial mis-management precipice that can best be paraphrased by the common wedding vow of “until debt do us part.” The International Monetary Fund, World Bank, and European Union nations have been propping up the checking accounts of the PIGS for several years now due to the world-wide economic recession, and have instituted austerity plans much to the consternation of each nation’s citizenry. Never mind that the PIGS knowingly over-extended themselves for decades, primarily by means of lavish spending on government employee hiring, salaries, pensions, and infrastructure that has left each countless billions in debt. With bank coffers empty and future obligations unsustainable, these countries have had no choice but to declare themselves insolvent and thus lay-off workers, cut pension and healthcare benefits, raise taxes, and reduce overall capital investment outlays. These measures have led to constant protests, rioting, and other bellicose responses from current, unemployed (each country's unemployment rate exceeds 20%), and retired government employees who believe they are “entitled” to these promised benefits. What continues to baffle outside observers of these messes across The Pond is this simple question: if the government doesn’t have the money, how can it make good on the expenditures; “promised” or otherwise?
Similar acts of the PIGS folly are going to be played out all over the country, and most prominently here in California. The cities of Vallejo, San Bernardino, and Stockton have already declared insolvency, and countless others are on the verge, to say nothing of the state itself. In every instance, the root causes for the financial calamity are the same as those exemplified by the PIGS. Governor Jerry Brown, Senate Pro Tem Darrell Steinberg, and Assembly Speaker John Perez, Democrats all, continue to cater to their public employee union constituency, preferring to feed their never-ending compensation and benefit appetite by means of increased taxes on California citizens and business (who's rates have for years already been the highest or among the highest in the nation). All three “leaders” are well aware that the current rate of this government subsidization is past it’s breaking point, but they could care less. They believe it’s their successors’ conundrum with which to contend. Or will it in fact bite them prior to their current terms expiration? They would be well to heed a quote from Winston Churchill and take corrective action now:
"An appeaser is one who feeds a crocodile, hoping it will eat him last."
Bon appétit, Sacramento!