Johnny Debacle’s Debacle Plan for California

by Johnny Debacle

California is the home of honey and milk, but soon to be the home of fiscal crisis. Oh but it’s so beautiful there, and progressive, and they are forward thinkers, and green too, and don’t forget multicultural and don’t forget they hate the gays! Who doesn’t love California! All things to all people. Well, it’s a good thing you people love it because the rest of the country is going to have to bail it out.

Fact: There are a million crazy reasons why California’s budget is high, including pension spiking and paying firefighters 4x the avg income of a resident. If firefighters are some of the highest paid people in your county or state, with salaries well into low-six figures, great benefits and true pensions that allow you to retire at 50 and receive salaries (in perpetuity) above what they made in the 4 yrs they actually worked…well, then your your state had better be on fire or beset by fire-breathing dragons like in Reign of Fire because that’s the only way to justify that level of compensation.

Fact: Calpers is apparently not good at investing money. Especially in Real Estate. Maybe I am being too harsh, but losing 103% of equity is sub-Madoff. When you factor in the advantageous tax-loopholes of being defrauded rather than your investments crappily managed, Calpers’ RE performance is worse than Madoff.

Fact: The state is run by a man whose most favorites words are “I’ll be back”, which, not coincidentally, is what people say most often when they deliberately plan to skip out on a bill, and never be back.

A fiscal crisis looms in California and the most likely broadly palatable fix is some sort of bailout of CA by all the non-CA states. To that, I say we should learn to change our palette and develop an acquired taste for more extreme solutions.

Solution: My solution is simple. Johnny Debacle’s Debacle Plan for California. America should make California an off-balance sheet liability. And by off-balance sheet, I mean we should sever California from the continent. You love your state? You can have it. CA seems to have a thing for earthquakes, so that is the most direct solution but I am open to any Debacle that can cut California off from the continental US.

Crust penetrating alien space lasers? Beam away, Xenu.
Subterranean magmatic discharges? Here you guys come.
Poseidon’s rage creating a water torrent that snakes around CA’s land borders? I’m sure they did something to piss you off, like calling you Neptune.

The United States should help put back California where it belongs. Floating alone in the ocean.

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  1. timThompson
    December 17th, 2008 | 3:51 pm

    Of course, California is, in fact, usually on fire.

  2. December 17th, 2008 | 4:18 pm

    Who knew CalPERS would blow up?

    W.C. Varones knew, that’s who.

  3. To The Hilt
    December 17th, 2008 | 5:48 pm

    I’m a little worried about this plan. I’m afraid the country will be out of balance.

    If we cut off New Jersey and Michigan, though, we should be okay.

  4. Matt
    December 17th, 2008 | 6:58 pm

    How dare you raise questions about the liberal utopia? They are the enlightened elites whose job is to sneer at the rest of the world and tell them how to live goddammit!

    Come to think of it, they are indeed very smart – masters of game theory. The big-3 did the same thing and now will get bailed out. CA will come in with the same argument when finally broke. Can you allows millions of people to lose their pension benefits you evil fiscally conservative knuckle-dragging mouth-breathing wingnut? Can you?

    Long irresponsible behavior. Long short term populism. Long feel-good elitism. Short prudence.

  5. Matt
    December 17th, 2008 | 6:59 pm

    Oh, I forgot. Long hope and change.

  6. Alex
    December 17th, 2008 | 7:10 pm

    Why stop there? lets sell-leaseback Alaska back to Russia, take a state- equity loan against Texas and use the proceeds to flip New Mexico for a quick profit. Will have to foreclose on Arizona, though. Create SIV and fund it with Montana. Enter into a forward on Oregon state. Swap Wasington for British Columbia, buy Puts on Idaho.

    Or just take all 50 states, bundle them up and sell MBSs ( Municipal back securities)- income to be distributed in tranches.

  7. Matt
    December 17th, 2008 | 8:00 pm

    Alex said “a state- equity loan against Texas and use the proceeds to flip New Mexico for a quick profit.”

    Why would you need the proceeds of a loan to sell something else for a profit? Seems like we have a Californian here.

  8. RichL
    December 17th, 2008 | 9:20 pm

    Why not simply reverse the Treaty of Guadalupe Hidalgo that we made with Mexico in 1848 and give California back to them?

    We paid Mexico $18.25 million for California. If they refund the money at a 6% interest rate, we should get back roughly $192.7 billion, which we could reinvest in another war in the mideast, or even put it into a major bank!

    The Mexican population is already in-state so that would solve all manner of undocumented alien problems.

  9. December 18th, 2008 | 8:29 am

    I like your thinking Alex, I think the US should switch to a more asset-lite kind of model, let’s monetize everything we can and sell all our non-core assets. Then let’s take the US public, and immediately empower the Treasury the power to short the equity of the US, then watch it plummet, then use the proceeds from those short positions along with additional treasury debt to fund a management buyout of the US, rinse lather repeat. I bet there are foreign investors we could this 4 or 5 times too before they figured it out.

  10. December 18th, 2008 | 8:33 am

    Mr. J — I’m with you and Alex. Let’s put Steve Schwarzman in charge of the program, as National Restructuring Czar. He has experience in the whole private-to-public-to-private thingy.

  11. Geppetto
    December 18th, 2008 | 10:49 am

    Short TV Ads for California:
    Find Yourself Here…but Don’t Find Yourself Queer.

  12. Matt from CA
    December 22nd, 2008 | 12:54 am

    I live in California and enthusiastically endorse the plan to cut loose the other 49 states.

    Take a look at this:

    To save you the trouble of clicking: California creates $47.6B in federal income tax receipts IN EXCESS of all federal spending going to CA. Per year. That’s the most of any state. For every dollar of federal taxes paid by Californians, we get $0.78 in federal spending back. Which puts CA into the bottom 10 states in terms of the ratio of federal taxes paid/federal spending in state. We’ll be happy to keep the money right here, folks.

    You must be thinking: “Wow, if even an irresponsible, liberal state like CA provide more money to the Feds than it gets in return, how much better must the fiscally (and otherwise) conservative states do?” Well, the top 10 net recipients of federal money (lowest fed tax to fed spending ratio) ALL voted for Bush in 2004. Of the top 10 “donor states”, only two did (CO and NV).

  13. December 26th, 2008 | 11:24 am


    Your numbers mean nothing here. Agreed, lets cut off CA ala “Escape From LA”, starring Johnny Debacle as Snake Bliskin Debacle