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Capitol of Pennsylvania Files for Bankruptcy Protection

Mac Slavo
October 12th, 2011
SHTFplan.com
Comments (102) Read by 503 people

Back in December of 2010 we published a report in which well known bank and economic analyst Meredith Whitney warned of the coming debt defaults of local and state governments:

It has tenticles as wide as anything I’ve seen. I think next to housing this is the single most important issue in the United States and certainly the largest threat to the US economy.

In less than a year the Capitol of the State that once hosted the Constitutional Convention, Harrisburg, Pennsylvania, has become the first major government body to file for bankruptcy:

The city of Harrisburg, Pennsylvania, facing a state takeover of its finances, filed for bankruptcy protection following a vote by City Council, according to a lawyer for the council.

Mark D. Schwartz, a Bryn Mawr, Pennsylvania-based lawyer and former head of municipal bonds for Prudential Financial Inc.’s mid-Atlantic region, said he filed the documents by fax to a federal bankruptcy court last night. The filing couldn’t be confirmed with the U.S. Bankruptcy Court in Harrisburg.

The state capital of 49,500 faces a debt burden five times its general-fund budget because of an overhaul and expansion of a trash-to-energy incinerator that doesn’t generate enough revenue.

“This was a last resort,” Schwartz said in an interview after the council voted 4-3 to seek bankruptcy protection. “They’re at their wits end.”

In a copy of the Chapter 9 petition provided by Schwartz, the city lists both assets and debt of $100 million to $500 million. According to the copy, the city has 49 or fewer creditors.

The Pennsylvania Senate is scheduled to take up legislation next week that would make Harrisburg the first municipality in the state to be placed in receivership.

Source: Business Week

Most of the bond holders, just like those who held debt in the now government and union controlled General Motors, will be wiped out or forced to take reduced payments, which doesn’t bode well at all for the municipal bond markets. Zero Hedge weighs in:

And now that the precedent has been set (yes, Virginia, it can be done) watch as tens if not hundreds of other cash-strapped towns, cities, localities and other entities follow suit promptly to quite promptly.

And now, spin time.

For those who thought government jobs and pensions were safe from the economic contraction, think again. As cities and states face budgetary problems amounting to hundreds of billions of dollars, their only recourse will be to start cutting jobs and renegotiating pension commitments. Meredith Whitney had a gloomy forecast for this as well, claiming in June of 2010 that at least 2 million government jobs would be eliminated as city councils and state legislators are forced to tighten their belts.

Harrisburg is the first. It won’t be the last.

And, as we’ve opined previously, the States are soon to follow with their own debt problems. While the Federal government will likely step in with bailouts when we get to the State level, the real question that should be on everyone’s mind is, who will bail out the US government’s $150 trillion plus in future liabilities?

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The Finger is on the Nuke Button | Future Money Trends

Author: Mac Slavo
Views: Read by 503 people
Date: October 12th, 2011
Website: www.SHTFplan.com

Copyright Information: Copyright SHTFplan and Mac Slavo. This content may be freely reproduced in full or in part in digital form with full attribution to the author and a link to www.shtfplan.com. Please contact us for permission to reproduce this content in other media formats.

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102 Comments...

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  1. Mike says:

    Good coverage Mac, keep up the good work. this will not be the last am sure. Just don’t know when the S will HTF .

    • Thanks Mike. My goal here is to keep people informed as these events unfold. A year ago maybe there were some who didn’t believe the forecasts regarding the muni markets and city debt defaults. Now it’s real. So hopefully those who refused to pay attention then are realizing there may actually be something to this.

      We see protests on Wall Street – as was forecast countless times here at SHTFplan et. al. by a variety of trend forecasters and analysts. And granted, they are political protests and for the most part non-violent (unless you count the police brutality, of course), the point is that slowly but surely all of these events are playing out right before our eyes. Occupy Wall Street is nothing compared to what we’ll see in the streets of America when college students are replaced by people who can no longer put food on the table or keep a roof over their heads.

      I guess the best way to put it is that the S is hitting the fan right here and now. We are, for all intents and purposes, witnessing the collapse all around us. Now, will there be a ‘waterfall’ moment in the future, like a rapid hyperinflationary meltdown in the US dollar? Maybe — that is certainly a possibility — in our opinion, a strong possibility. But so, too, is the long and protracted breakdown over several years like a Great Depression, but worse, at the end of which their will essentially be no more middle class in America.

      The wealth of the people of this nation, and many others, is being destroyed before our eyes. However it plays out, the end result will be desperation, destitution and destruction.

      • KY Mom says:

        Mac,

        Thank you for all you do in keeping us informed. 🙂

        It is scary to think about the future we face. But, if we are fore warned about what is coming, at least we can do what we can to prepare.

        KY Mom

      • DRD5508 says:

        Agreed. Article is first rate, thanks for the info.

      • TomHolmes says:

        What’s always happened, is happening now, and will continue happening – is for “water (wealth) to find its own level” meaning everything is coming down to a level from which growth can begin again ie down to where people (consumers & governments alike) can afford doing things again. So, as all countries all default on the gov’t treasury debt at the same time together (“we can’t make these interest payments on our gov’t debt anymore, so you don’t have to pay us either – let’s just all default together and start over”). and let the pieces fall. they’re going to anyway.

      • What police brutality?

    • The Federal Government and all the states should read some reality based financial planning books like “A Simple Book of Financial Wisdom” by Danny Kafke.
      He believes in living below his means, planning ahead and setting money aside, not making snap decisions based on emotion or wants and filling needs first.
      Wow what a reactionary!! Crazy man.

  2. eric says:

    im heading to harrisburg today. the drivers up there are dumb. there is at least 4 accidents that you see every single day up there. they have a lot of gang bangers and shooting in that town. wonder why. yes good coverage on it.

    • emptyhandkiller says:

      Eric, I agree. Most of the cities in PA are s*&(holes, with violent idiots roaming the streets. My guess as to how the idiot politicians will handle the bankrupcy? Why, they will raise all taxes of course! I wouldn’t live in PA for anything.

      • Mclovin says:

        Gangbangers??? Now, Now just because Ben Roethlisburger is in the state doesn’t mean we should condemn EVERYONE!

      • KY Mom says:

        Don’t condemn the whole state. I lived in Pennsylvania for several years. Yes, there are liberal voting cities, but there are also lots of Conservative rural people. There are good people, as well as bad people…just like anywhere else.

        Harrisburg was just the first city to declare bankruptcy. We should look around the state we live in. There are probably many other cities which are financially in really bad shape also.

        KY Mom

        • Daisy says:

          Agreed. I’ve never been to any of the bigger cities in PA but I was lucky enough to spend time in the “Covered Bridge” country and the Amish areas, as well as Erie. It’s an absolutely beautiful, peaceful state with wonderful people.

          Big cities don’t really have more crime per capita – it’s just more people in a smaller geographic area. If 10% of the folks are criminals in any given population, do the math. A town of 1000 people has 100 bad people and a town of a million has 100,000 bad people. Geez, I hope the percentage is lower than 10% for the criminal element, but I digress. PA – beautiful place!

        • Ky Mom…my neighbor just left teling about new sidewalks, etc, new ballpark built last year hasn’t even been used yet—-our Ky. County must be rolling in money…oh, wait…didn’t my property taxes just increase….uhh, well,,uuhh, hmmm.

        • PO'dpatriot says:

          You’re darn tootin’ KY Mom, I live in the People’s Republic of Maryland and Baltimore City is the ARMPIT of the world, bar none! Thank God I don’t live anywhere near B’more. It is an utter complete [email protected]%thole.

      • PABOY says:

        Well that hurts! I live in PA and many of us love the beauty of the State. Leaf peepers come out from the cities to enjoy the fantastic views of the mountains as the leaves change. Many take pride in their homes and homesteads.
        Yes, there are some ugly sites to see and poor towns. But what city or State does not have its eyesores. I think that this is where you visited.
        I have so many pictures of PA along with beautiful sunsets and season changes I would not trade places with anyone.

    • “lot of gang bangers and shooting”. You obviously haven’t spent much time in Central Pa.

  3. This is getting worse by the day…

    Collapse is tapping at the back window, and I fear will bash it out soon…

    TotalCollapse.com

  4. eric says:

    it will be just like greece, there is no other way. the pensions will be wiped out and welfare will be on battle between the parties and more of this crazyness. wont be on the main news for a few days. the middle income are going to take another hit and this is truly a domino effect and will effect everyone. There are going to be some really outraged people as this 150 trillion debt has to be paid they can’t put it off to the side any longer. its going to get crazy. Did you see that jerry brown now just passed a gun ban that takes effect in Jan that its a measdemeandor however you spell it for guns that are in the trunk of your car, you could be fined up to a thousand dollars or a year in jail. That is just crazy!! the criminals will not do a damn thing about it while our gun rights are slowly stripped. we have to flood his office gov. jerry brown ca.

    • I just received an email that Calif has mandated gardasil to 12 year olds…wait..are you sitting down?? but 18 year olds can’t use a tanning bed…this is the ultimate proof the state of Caly needs to secede.
      They’re embarrassing the rest of us.

  5. Dave says:

    I’m sure the government will gladly backstop any such default with freshly printed cash, and are likely even hoping for it. They don’t care. Print, print, print. At the end of it all, it’s another city (or state) under the absolute control of this government, who will then do whatever their master tells them to do. Bank on it. So to speak.

    I feel for the pensioners in this. All bets are off once the BK is filed. They may be wiped out in an instant.

    Keep your chin up, Harrisburg!

  6. smbizandy says:

    is what i say!!!

    people seem to have a ton of $ when it comes to attending a auction sale..

    I wonder how cheap a town or a city would go for AT AUCTION.. people included..

    2012 LOOKS LIKE ITS COMING AT US ALL LIKE A STEAM ROLLER!!

  7. Patriot One says:

    Yeah Mac I think things are going to come to a head fairly quickly. This site and the people who comment here, as well as myself have been called crazy, doom & gloomer’s, nut jobs.

    But, a funny thing happened on the way to a systemic financial collapse. Everything we were talking about 24, 18, 12 months ago is starting to become reality.

    Meredith was called a Loon last December by the MSM and it hurt her business. So regardless of whether your are right the liberals and the MSM will Crucify you.

    • “a funny thing happened on the way to systemic financial collapse” ….LOL… +1!

      At this point unless I see real, hard data that says things are better, I believe nothing they say. Headlies pervade the entire media propaganda establishment. And those who base their decisions on this information will get crushed, not just financially.

      • Patriot One says:

        I just have a hard time believing people are that stupid, but they are. The MSM is using the same Head Lie over and over. Take Greece, the markets are up on Greece and the markets are down on Greece. Nothing has fundamentally changed with Greece, but the markets are run up and down on a head lie about Greece.

        Every Company that shows a profit is plastered all over the Head Lies. Here is the real story; look at what you don’t see in the Head Lies. Look at Wal-Mart, Home Depot, Staples, Office Max and Depot.

        Visit the stores, the shelves are all fronted up and they don’t carry as great a variety as the use to.

        Most of the Parishes, villages, cities and town’s in America are Bankrupt, they just haven’t filed the paperwork yet.

    • Ben Dover says:

      I remember everyone calling her a nutjob chicken little.

  8. Mike says:

    I am thinking that the S will really Hit the Fan when Greece collapses in a few weeks. Riots will increase for sure.

    • Europe is in big trouble…. It’s going to get very ugly over there, and will eventually spread here.

      • manos says:

        Mike and Mac,

        I really hope that it stops in Europe.
        They are trying desperatelly to save it.
        To give you a clue regarding the hypocricy, stock markets climbed today. What were the good news?
        The banks haircut will touch 22% instead of the speculated 60%.
        In plain words, and forgive my language Mac: The rapist penetrates the victim with 1/3 of his winnie, rather than the whole of it.

        Be prepared guys.

        • Ha! Manos, yes, a crude way to put it but, point taken: rape is rape anyway you look at it. I’d love for it to stop there. Not that I think you guys across the big pond deserve it more, quite the contrary. It just would be nice for it to stop but I can’t see that it will. I don’t think any part of the world is immune now.

          Now with this one default, there will soon be tw

        • (touch pads and laptops… Grrrrrr)

          Soon there will be two, then three and then gobs. I think this is the equivalent of the first drop of rain when you see those dark clouds on the horizon.

          Can you feel it? I think what we’ve talked about, over and over, is very close. Time to pack in a final load.

          I was waiting for gasoline to drop before I refilled the last stale barrel, but, not now. I’ve got to have the tanks full and the larder stuffed for the coming store. Anyone else feel that way?

      • Patriot One says:

        Here is a little history and fact on European Banks. I don’t agree with the end of the article, but many will.

        ROBERT MORLEYCOLUMNIST
        Europe’s Banks Begin to Fail
        October 11, 2011 | From theTrumpet.com
        A chain reaction is set in motion—and a lot of people are going to get hurt.

        ROBERT MORLEY
        The date is May 11, 1931. Creditanstalt, a little-known Austrian bank, suddenly announces it can’t make its debt payments. An unstoppable chain reaction results.

        Bank failure, stock market crash, mass business closures, 25 percent unemployment, trade wars, runaway inflation, multiple currency collapses, the Great Depression, World War ii. All of it began with a little-known bank in a small country in the heart of Europe.

        That is history. And it is happening again.

        A similar epoch-changing event may be about to occur in Europe.

        Last week it was revealed that Franco-Belgian banking giant Dexia was virtually locked out of debt markets and in desperate need of cash. Depositors began a run on the bank—withdrawing over €300 million on Tuesday alone. Investors bailed too, sending the bank’s share price plummeting into the penny stock range. On Thursday, its stock was suspended from trading while governments decided what to do.

        The announcement sent Belgian and French politicians into a conniption fit. These same authorities spent billions bailing out the bank in 2008. It was supposed to be fixed.

        Making matters worse: Dexia passed not one, but two European bank “stress tests” (the latest in July) with flying colors.

        So if you can’t trust the banks (because they cook their books), and you can’t trust the experts and authorities overseeing them (because they are either liars or incompetent), who can you trust?

        That summarizes the problem at the heart of Europe’s banking crisis: broken trust. If the meltdown of ‘08 taught us anything, it’s that confidence and trust is what banks can least afford to lose in a crisis.

        Unfortunately, Dexia is far from alone. It is just the most visible time bomb waiting to implode.

        On Friday, ratings agency S&P downgraded 12 banks in the United Kingdom and nine in Portugal, including UK government-owned banking behemoths Lloyds and the Royal Bank of Scotland.

        The threat to the economy is so great that the UK government announced it would start another round of quantitative easing (QE) to prop up the economy. Seventy-five billion pounds will be electronically digitized and given to troubled banks.

        This is Zimbabwe policy. After the panic is over, who will want pounds, when they are simply created out of thin air? Value is determined by its rarity and non-counterfeitability. By repeatedly announcing additional rounds of QE, the Bank of England risks destroying both. The pound will get punished. Add another zero to the cost of a loaf of bread.

        Bank of England governor Mervyn King justified his action by saying that this is the most serious financial crisis the world has ever seen, at least since the 1930s, “if not ever.”

        The “deterioration in the outlook” means more “quantitative easing” was justified, he said.

        In other words, the risk to destroying the pound was outweighed by the risk of the immediate economic collapse. So the pound will be devalued—further destabilizing the international currency system.

        Europe is a powder keg sitting on top of nitroglycerin, suspended by spider threads over a furnace. And the furnace is flaring.

        If authorities “cannot address this in a credible way, I believe, perhaps within two to three weeks we will have a meltdown … across the European banking system,” warns International Monetary Fund (imf) adviser Robert Shapiro (emphasis mine). “We’re not just talking about a small Belgian bank, we are talking about the largest banks in the world, the largest banks in Germany, the largest banks in France, that will spread, that will spread to the United States, that will spread to the United Kingdom … it will spread everywhere because the global financial system is so interconnected.”

        Two to three weeks of normalcy may be all this world has left. “All those banks are counterparties to every significant bank in the United States and Britain, and in Japan, and around the world,” warns the imf adviser. “This would be a crisis, that would be, in my view, more serious than the crisis in 2008.”

        More serious than 2008? Bear Stearns, Lehman Brothers, IndyMac Bank, Countrywide, Wachovia, Merrill Lynch, Washington Mutual, Fannie Mae, Freddie Mac—the list goes on—all went bankrupt or became nationalized. How do you get more serious than that?

        Realize: In 2008, the banking system was insolvent. Three years later, the banking system is still insolvent, but now because of the massive bailouts, sovereign governments are verging on insolvency too.

        Yesterday, after emergency marathon negotiations, French, Belgian and Luxembourg politicians agreed to put their taxpayers on the hook for 211 billion more euros to prop up Dexia. But how much more debt can these countries take before they are the credit risk? Will this bailout be the last? Moody’s rating agency immediately put Belgium’s credit rating on review for downgrade. France’s won’t be far behind.

        But if the Europeans are barely able to keep a handle on their banks, who will bail out Greece? What about Spain and Italy? Who will pay for the war in Libya?

        “We are on the brink of structures failing, spiraling the financial world into such a bleak scene comparable with the 1930s and the Second World War are valid,” warns former Chase Manhattan analyst Julian Philips. “The recovery prospects are more than dim. There’s far too much debt for the developed world to repay, so more debt will cripple it.”

        Events seem to be spiraling out of control. On Monday, British Prime Minister David Cameron begged European leaders to take a “big bazooka”-type approach to heading off collapse.

        Specifically, Cameron wants Germany to take “collective responsibility” for Europe. A single market with a single government is needed, he says. “[Y]ou have to do the whole thing. … Time is short, the situation is precarious.”

        More ominous words could hardly be spoken. Time is short. The situation is precarious. But backing Germany to take control of Europe is about the most shortsighted and condemning statement a British politician could make. Echoes of Chamberlain abound.

        As Gerald Flurry recently wrote, the current economic crisis could be “the very event” that gives Germany the empire that has always eluded it.

        Great crisis present great opportunities. Watch Germany for the solution to Europe’s crisis. And read Gerald Flurry’s article “The Fourth Reich Is Here.” •

        • Ha! From the sounds of that article all Hitler would have had to do is wait 70 or so years and he wouldn’t have had to burn all that gunpowder and explosives and then lose in the end.

          First they cussed the Germans and we saved them. Now they’re cussing the USA (via the Fed) and the Germans are (maybe) going to save them.

          Is this world messed up, or what?

      • greaseman says:

        I don’t think most of the general population realizes how close we are to a SHTF situation. I believe it will start as any other day, but some contagion, possibly a derivatives problem might get the ball rolling. Anything right now is possible.

  9. John Q. Public says:

    Excellent analysis of the false flag flop:

    http://revisionistreview.blogspot.com/2011/10/alert-alert-iranian-government-high.html

    Following the imbedded links is quite edifying.

  10. Mike says:

    I’ve been prepping for about a year; guns, gold and a get away plan. Although I am careful not to advertize it, most people I talk to have no clue what’s in store, stuck in the normalcy bias.

    And I do not put much faith in the DC politicians; they are the same people that got us in this mess

    • greaseman says:

      right now, all you can do is prep, and sit on ready. things will happen when the bankers decide to pull the plug, or an unforseen problem takes hold. Either way, the system is going down.

  11. MLG says:

    This happened in R.I. a few weeks ago. Can’t remember the small town, but they filed as well.

    • The Old Coach says:

      It was Central Falls, RI. In interesting metaphor, in that Central Falls is the location of the Slater Mill, the first textile mill in the western hemisphere, and thus arguably the beginning of the industrial economy in America. It was a thriving city in the late 1800s, but by 1980 when I lived in R.I., the textile industry had been gone for almost 50 years, mostly a victim of rampant unionization. Central Falls had become a ghetto, full of government corruption, illegal immigrants, and crime. But it’s just the worst spot in a whole state that is run as a Mafia enterprise. This is how America dies, bit by bit. Failed local governments are taken over by crime syndicates, tax revenues are diverted to the personal benefit of the syndicate bosses, rational people bug out, and eventually the whole edifice collapses like an abandoned barn.

  12. I recall the city manager of Stockton, Ca saying that in 20 years it will be him, a tax collector and a third person to send out the pension checks. With the money the city collects those are the only 3 employees the city will be able to pay as they meet the pension obligations of “defined benefits.” People now don’t care. Harrisburg might be lucky to get it over with right now.

  13. Gods Creation says:

    It was the fiction that declared bankruptcy, not the People. A constitutional government, local or state, can not go bankrupt.

    Now is a great time for the People to reclaim the real estate from the corp and seat a lawful government.

  14. Tim says:

    The USA as we once knew it is already gone. And it most likely won’t ever return. Is it any wonder that the cities would soon follow?

    It is still not to late to find a different and better way of (survival)life. One that relies on the you and your family, friends, and neighbors. Hard work surly. But for all who help and do their part, many pure and good rewards will follow.

    The only system that will ever endure is the one where self reliance and working the land for ones existence is priority.

    People wanted luxury, material things, and ease,
    even in the work they desired to perform. [Don’t want to get those hands dirty and the smell of the livestock is too much, huh?] Look around and see what that always brings.

    Working for “money” to buy ones existence and happiness doesn’t ever last all that long and inevitably lets you down. And down very hard too! Too late is it to learn to care for yourself? Not really. It’s up to you. There still may be time.

    Any that can grow vegetables and raise some meat animals has a pretty good chance to survive most anything. But a trillion bucks in your pocket might get you a loaf of bread someday. Sarcastic? Yes. True? Yes.

    Was it Jesus who warned of the love of money? I think that was in the book of Timothy wasn’t it? Someone there said something like that. How about opening your Holy Bible to find out just who did say that. Let me know, okay.?

    I pray that God be with all those who love Him and seek His truth and His way.

    • Busy Bee says:

      Tim, what you say is a nice thought. I’m lucky enough to have inherited 10 acres, I garden and preserve food. Someday I hope to add livestock to the homestead, but while working full time, that is pretty difficult.

      I think most people have been priced out of being able to have enough property to even tend a small garden. It is very expensive to start up an agricultural lifestyle in these times. The only ones making money in agriculture are the big agri-businesses. In my area a few small organic farms are doing ok, but you have to be very specialized.

      Heck, many people don’t even know that a potato is dug out of the soil. You just go to the grocery and pick up a bag.

      I live just over the border from PA and did not see this on any news here. Thanks Mac for the information.

      Keep praying, keep prepping.

    • manos says:

      Tim,

      USA still has the potential of changing direction. It’s not too late.
      You need a model similar to the Independence era. Communitites, small villages, self sufficient farms and families.
      Globalization and economies of scale failed. It’s not capitalism that caused the collapse. It’s greed and corruption to create the chaos which will follow.
      Trust to God, you skills, and your family bonds.
      Don’t let them scare you.

      Manos

    • Lynda from rual Maine says:

      Hi, the Bible says quite a bit about money riches. I was reading in the book of Timothy one’s attitude towards their money. We are warned against getting prideful because of our riches.
      I have heard it said the bible teaches against money and richness. That is not true.Abraham, Jacob, Issac, and Solomon was very rich. Abraham employed lots of workers and treated them fairly.
      It is the condition of our hearts concerning money. The bible teaches not to forget where all blessing come from.
      If you think about it everything was already here for us to use when we were born. The oil, air, minerals,soil, trees. givren to us by our creator. Even our brains. used to think up ideas to make money. That is what we are to remember.
      We all must admit that we got caught up in the credit gameand some of us went over board. I noticed in my own family how some of us were trying to out do the other in buying things, all on credit. My own daughter and her husband bought a escalade they could not really afford, went on trips, because being in the military they seem to be able to get credit cards. Now of course, they are in debt, back to a smaller car and back to their senses.
      They use to laugh at us for our simple life. They are not laughing anymore.

    • Tim…how can one live on vegetables and meat?

      Pioneers bartered for what they didn’t grow or make..you left that out—no family is self-sufficient and can provide all needs.

      Learn to barter. Soon.

  15. wheedle says:

    Thanks for the story and links Mac. “Austerity measures” are coming to the U.S. and I don’t think taxpayer funded employees are going to be happy about it. Greece is showing us where this path will lead here.
    Also reminded me of this:
    http://www.npr.org/templates/story/story.php?storyld=60740288

  16. RICH99 says:

    Thrill Me, Kiss Me, Kill Me.

  17. Sandy says:

    I could have sworn that this time last year I read that
    Toledo, OH was on the verge of bankruptcy and that by
    November (of last year) they would be unable to pay any city workers. Never heard anything else after that. Did they get a bailout or was it just more fear mongering?

  18. The Old Coach says:

    I doubt that the Harrisburg bondholders will take the same haircut that the GM bondholders did. The Harrisburg bankruptcy will hopefully be conducted in accord with the law. The GM bankruptcy most assuredly was not. Prosecution of the PTB that arranged the GM asset transfer should be high on the agenda of any new Administration. Always assuming, of course there actually IS an election in 2012.

  19. DGB says:

    Graduated from Penn State in 72. Left the state and went back infrequently. Allentown was a nice place in 1965 – now it’s a hell hole filled with Puerto Ricans and low life. The downtown is deserted. The industries are gone. Philly is a combat zone – maybe could become another Camden.

    Done / cooked / stick a fork in it.

  20. Daisy says:

    Did anyone stop to think…..what becomes of the suppliers to whom the city owes that money they are defaulting on?

    One large bankruptcy can knock out other businesses. Then the dominoes begin to fall, one after another. Then what happens when other cities follow suit? More dominoes?

    • The Old Coach says:

      The suppliers take in the shorts. I was a creditor to the bankruptcy of a private company in 1983. Out of what was left of the company, the lawyers got 100% of what they billed, a few ex-employees got about 80%, due to New York State law. The unsecured creditors got 3 cents on the dollar. The Harrisburg bankruptcy could put a small to medium business under. But if that happens, it’s their own fault. H’burg has been on death watch for two years or more, so anyone not selling strictly C.O.D. was a fool.

  21. Old Fuzzy says:

    If the PTB can manage it, they would like to see a steady but rapid decline in the standard of living in the West. All people must be equal, according to them. They can’t make everyone equally rich, so they will make us all equally destitute. Resist.

    • greaseman says:

      that seems to be the plan so far. if everyone is so broke, they can’t pay attention, they tend to be more manageable.

    • The Old Coach says:

      I would phrase that a little differently. Many if not most of them don’t WANT to see the US standard of living decline as their first priority – their first priority is raking off as much for themselves as possible. If the economy declines, well that’s just too bad. “I’ve got mine, Jack!” But there’s a small cadre of nihilists that DO want everything to collapse. What they get out of it other than the macabre satisfaction is beyond me. Like the scorpion in the old fable; it’s just their nature.

  22. SmokinOkie says:

    Overheard in Vegas: “I’ll take the visitors to cover the 90 point spread.”
    Our country is undergoing major, undesirable changes. The PTB just keep lying and stealing, like always. And the TV can only report stuff that fits their own twisted agenda. It seems the whole rotten system is rigged and ready to crash. Meanwhile, 150 republicans all want to be our next prez!

    Watching all this reminds me of a football game. Here’s the set-up:
    The home team players and fans are us. The real Americans. The middle class. The hard working people. The few. The proud. The Marines. Real. Comfortable. Jeans.(sorry, I got carried away)
    Visiting team is the banksters, globalists and political scum. Their fans are the sheeple.
    Cheerleaders are the mainstream media.

    Play by Play announcer: Well, folks, it looks like this is it for the home team. First the visitors spiked the home gatorade with acid, then demanded to use the referees they brought with them. So far, the refs have penalized home team 38 times for 400 yards. And they have yet to throw even one flag against the visitors. Plus, they insisted on using the visitors balls. When they have possession it’s a standard football. When home team has it, it’s got a 12 lb lead weight inside. Three of the home team boys have been knocked unconscious just trying to catch a short screen pass. But the home team hasn’t given up. They’re trailing 166 to nothing with 44 seconds left in the game. They have the ball with a 4th and 28 on their own 3 yard line.

    Color Comentator: Looks like a time out’s been called by the visitors. Evidently, they want to run the score even higher if they get the ball back! And, what’s that there? It seems the home team cheerleaders are walking down the sidelines offering crack pipes to the players. This is unbelievable! And don’t you just hate it when the home cheerleaders applaud after every visitor score?

    PBP guy: Yeah, and the referees just kneed one of the home team players in the groin…and NOW they’re throwing a penalty flag on him for laying down on the field!

    Color guy: Wait a minute… there appears to be a sniper standing up on the visitors sideline…he’s aiming a really big rifle at the other side…WOW! He just shot the home team coach! And the visiting fans are cheering wildly! This is incredible!

    PBP guy: And it looks like the refs are gonna penalize him for delay of game. The poor guy’s nearly dead, and they’re throwing a flag on him?! And somebody please get that cheerleaders foot off his chest wound!

    Color guy: The stadium announcer has just asked if any of the fans could take the wounded coach’s place to finish the game. And look at that! About 150 visiting fans are streaming on to the field! They’re fighting over who gets to coach the home team!

    PBP guy: If this gets much worse, I’m going back to doing hockey!

  23. Hard Times says:

    My question? all the retired fireman, policemen, city workers etc… Will they get completely stiffed for their pensions in the bankruptcy? This would be the case in the private sector. somehow me thinks the fed will just print a few more stacks to keep all the pension commitments. Oh what a world

    • greaseman says:

      In the end, if it’s on paper, it won’t be worth anything. Smart people will cash out of anything they have on paper, and pay the penalty now, rather than be told, “sorry” later. People think if it hasn’t happened to them, it can’t happen. They are going to be sadly mistaken, and have nothing left when everything crashes.
      Listen to your gut. it’s trying to tell you the truth. Cash out now, you don’t have much time left.

  24. clem says:

    The main stream media continues to push this “recovery rally” in the markets. Now just look at the indexes in charts and explain this recovery. I see a clear down trend or side way action at best. Little confidence in these manipulated markets.

    With investments heading lower in value, I see only more of the same without positive solutions. Scrambling to save their jobs are the rats who got us here and spit out phrases like the ones you see in the MSM.

    I think you are right Mac. More filings on the way. Stay mobile and vote with your feet.

  25. Southern Trumpet says:

    I think that if a collapse is inevitable, then it is better to be a slow decline then a sharp jolt. In much the same way in which a volcano may rumble or give off smoke before it finally blows, these all provide warning signs. I hope that this decline gives more people time to get their lives in order. Don’t forget about the ones who can’t help themselves. I was shocked when I saw the picture of the little, frail, scared old lady at the SuperDome surrounded by animals. We need to help others that DESERVE help.

  26. RandomTangent1957 says:

    Good article Mac ! I was born & raised in Pittsburgh PA. Used to be the Steel City….before all the steel mills closed down. Pennsylvania has been the land of taxes as far back as I can remember. Back in the ’50’s Pittsburgh was the number 2 city for big band & Broadway acts. They used to perform at the Holiday House In Monroeville ….& at the Airport Clubs as well.

    The County Commissioners decided that they needed to get in on the game….so they came up with all kinds of ammusement taxes & fees….& ran all of that out of town. In the 70’s & 80’s it got even worse. They started charging promoters for police to direct traffic & raised the ammusement tax some more. A county west of Allegheny County said that they would be happy to have the events there…..so Star Lake Ampitheater was built….& most of the good bands preformed there….instead of in Pittsburgh. These idiots just don’t get it ….that when people feel that they are getting robbed…..they find another way to do things. I bet Pittsburgh brings in a lot less revenue now than they did back in the ’70’s! My job went away up there in 1997…..& I moved to Houston Texas. This is a much better place to live. I will be making a road trip up to Pittsburgh later this week. I will see what I can learn as to what finances are like…..
    Montgomery County Texas

  27. greaseman says:

    everybody knows the saying, “crap rolls downhill”. Well, the downhill portion of the track has filled up, and the stuff is piling up. How these idiot talking heads on lame stream media can keep saying everything is going to be ok, and all we need is another bailout, is beyond me. Common sense says the hole in the dam is about to break wide open. if it was my municipality, I would want to file now, before the crap really starts to pile up.
    Denial of reality is a strong emotion, but reality will rear it’s ugly head soon enough. If I was a city government employee in one of any thousands of towns across the US, I would be considering a plan “B”. The end of the road is close, and the life style of all of us is coming to an abrupt change very soon. Learn to adapt or die. it’s that simple. Welcome to the new normal.

  28. Copout says:

    I am interested in knowing, for those that are attending church, are your Pastors talking about prepping? Do other church members talk about it, the conditions the country is in? Would like your input. Thanks, I hearing nothing and when I talk about I am a moron!

    • Glad you asked..Copout.
      Not a word..and the last church I belonged for two years..actually???? made fun of me behind my back..sometimes ya just know…well, since I don’t have tv in the house, it was part of the package..being weird or strange.
      A lady I did a favor for called Monday; mentioned the word prepper and she said “a what??” and I said never mind.
      I’m trying to live down the weird stigma from the last church.

      • WestVaFolks says:

        In our church, only two other people (that we know of) are preppers – a husband & wife, very kind, very quiet people. Their children are grown and gone, but we’ve seen them at discount stores with loads of food and supplies in their carts (like us – ha!). We exchange the usual pleasantries but somehow seem to avoid the real reason we’re there. I think it’s because WE know and THEY know and…sort of like a silent understanding, you might say. Of course the usual cuckoo clocks are milling around (hubby’s word for morons) so the less said, the better, anyway.

        • Copout says:

          Thanks for responding, my son married a pastors daughter, and at Christmas time last year i had asked the pastor whay he would do if the Government came to haul him away, he looked at me and said Well i dont have anything else to loose. I am sorry but that statement to me is unacceptable. I wonder if the 5013c status keeps the majority of pastors neutered. Personally i think what is being said from the pulpit isnt enough. Ok i accepted Christ as my Savior, now what? What about everyday life, whats going on in the world? It concerns me greatly that nothing is be said, and just thought i would ask for some opionions, THANKS!

    • WaroftheRoses says:

      Our Bible study group is our mag. We don’t “preach” prepping, but encourage it.

    • Sam not sam says:

      There are several of “us” in my Church.. but no one much talks about it.. the Pastors know some; but generally, everyone just keeps it to themselves. Most Pastors won’t particularly get too political; that’s not their primary business and would distract from their main concern.

      Outside of my immediate family, only 2 other “local” people know about my preps and they are included in the deal if it all blows up.

    • Pastor R.G. says:

      Hey Copout,
      I am a local pastor in NC. I have been talking about prepping at our church for about a year now. Most of my folks were kinda skeptical at first, but time and the proper education won them over. Our church is small with a large number of seniors. They save what they can and together we have quite a large stash of food, water, seeds, tools and other items of importance. Some of our members lived through the great depression and are quite willing to talk about their experiences. The younger people in our congregation are the most skeptical, and aren’t willing to use their generations technology to see the truth.

      We have a community garden and rely heavily on the older members gardening skills to help us raise our crops. Most of us can things like beans and tomatoes, corn, peas, peppers. We are exploring whitener the town will allow us to dig a well on church property. That would be our biggest concern.

      If your pastor isn’t talking about what is truly happening in this country, you need to wake him up. No thinking man, spiritual or not should be unawares of the current condition of our country. Make him see what you see.

      • KY Mom says:

        Pastor R.G.

        Your congregation is lucky to have you as their pastor – to lead and encourage them in these trying times. 🙂

        I wish their were more pastors like you who would speak to the people and warn them to prepare.

        In my church, I feel there is an “unspoken rule” that pastors are not supposed to mention “prepping” in church.

        KY Mom

    • KY Mom says:

      Copout,

      It may depend alot on the pastor.

      Our last pastor “got it” and we sometimes discussed things in Bible study. He is now retired (grew up on a farm). He has bought a small house on some land and raised a huge garden.

      Our new pastor hasn’t mentioned anything remotely connected to prepping and probably doesn’t realize what is coming.

      I live outside a small town in a rural area. There are a number of people (older and well as some younger families) in the congregation who raise gardens, can their food, and live simply. They may not recognize the term “prepping”, just living wisely.

      Unfortunately, there are also a number of people in the church who are sheeple and not prepared at all.

  29. SmokinOkie says:

    To:
    City Council
    City of Harrisburg
    289 Deadend St.
    Harrisburg, PA

    Dear Councilpersons,
    It has come to our attention that you have recently filed for bankruptcy protection and re-organization under United States Code 24-303, Financial Relief Provisions, Subsection 40-9 (Chapter 9). Please be advised that under the terms of our contract, you are still fully liable for payment of all legitimate obligations.
    Our ongoing relationship with the city of Harrisburg has been fruitful and, we hope, as profitable for you as it has been for us. We remind you that our company gave your city the absolute lowest possible bid on our products, and you seemed very happy to purchase them at the time.
    We discounted our single layer product to a near-break even for us at only $2.45 per sheet. And we provided our premium quality two-ply at only $4.25 per sheet.
    Many surveys showed your Parks&Recreation Dept to be very satisfied. We hope to continue doing business with you, at the same low rates, but we must henceforth require pre-payment of all orders until the bankruptcy case is settled.
    Your current balance is as follows:
    Single ply, 80,000 rolls @ $245.00 each……$19,600,000
    Premium TwoPly, 26,000 rolls @ $425.00 each..$11,050,000
    Total Balance Owed………………………$30,650,000

    Also, we remind you again, of the irrevocable and non-cancelable balance which is still outstanding. Please remit the balance in full immediately. Thank you.

    Sincerely,
    Rahm

    Emanuel Toilet Paper Co, Inc.
    666 Graft Ave.
    Chicago, IL

  30. SmokinOkie says:

    Urgent Memo
    To: Shipping Dept, Billing Dept, Sales Dept

    Absolutely NO orders are to be shipped to ‘City of Harrisburg, PA’ without prepayment IN FULL.

    Sales Reps: Make this new policy CRYSTAL CLEAR to all your Harrisburg clients. If they complain, tell them to find another supplier(sucker).

    Billing Clerks: Make sure the check has cleared BEFORE you send any pick tickets to Shipping. Call the bank to make sure.

    Shipping Supervisors: Double check with Billing and with my office before loading ANY outbound trucks to Harrisburg. And tell our drivers to stop lending money to people in the mayors office there. They won’t get it back.

    All of you- pay strict attention to these new procedures. Every one of our jobs depends on it!

    Also note- We may soon have to adopt this same policy for the entire state of California. Check with me daily for updates. And ship their orders last in the day.
    Thanks guys and gals. If we’re careful, we may just be able to stay in business. (cross your fingers)

    Sincerely,
    The CEO of Every Company In America

  31. GoneWithTheWind says:

    It would be interesting to know what the city did in the last year to reduce expenses. I suspect they did not do much at all to reduce their risk of bankruptcy.

  32. SmokinOkie says:

    Think I’ll head over to Olive Garden for dinner. Anybody got a flag they can lend me?

    I pledge allegiance to the pasta, and to the restaurant for which it stands. One salad, indigestableable, under franchise, with liberty and breadsticks for all.

  33. VRF says:

    San Diego, Ca.

    Deficit through June 2012 : $73 million

    Budget in FY2011: $2.85 billion

    New York, NY

    Deficit through June 2012: $2 billion

    Budget in FY2010: $63.1 billion

    San Jose, Ca.

    Deficit through June 2012: $90 million

    Budget in FY2010: $2.7 billion

    Cincinnati, Oh.

    Deficit through December 2012: $60 million

    Biennial budget FY2009/2010: $2.5 billion

    Honolulu, Hi.

    Deficit through June 2012: $100 million

    Budget in FY2011: $1.8 billion

    San Francisco, Ca.

    Deficit through June 2012: $380 million

    Budget in FY2011: $6.55 billion

    Los Angeles, Ca.

    Deficit through June 2012: $438 million

    Budget in FY2011: $6.7 billion

    Washington, D.C.

    Deficit through September 2012: $688 million

    Budget in FY2011: $8.89 billion

    Newark, NJ

    Deficit through December 2011: $30.5 million

    Budget in FY2010: $677 million

    Detroit, Mi

    Deficit through June 2011: $85 million

    Budget in FY2011: $3.1 billion

    Joliet, Il

    Deficit through December 2011: $21 million

    Budget in FY2010: $274 million

    Camden, NJ

    Deficit through December 2011: $26.5 million

    Budget in FY2010: $178 million

    Hamtramck, Mi

    Deficit through June 2012: $4.7 million

    Budget in FY2011: $18 million

    Central Falls, RI

    Deficit through June 2012: $7 million

    Budget in FY2011: $21 million

    Paterson, N.J.

    Deficit through December 2011: $54 million

    Budget for FY2010: $225 million

    Chicago, Il

    Deficit through December 2011: $654 million Closed

    Budget in FY2010: $6.8 billion

  34. Durango Kidd says:

    Much of the overhang for most of these state and local governments are unfunded pension liabilities. The middle class will get hosed again as these benefits are renegotiated.

    Better to default on the bond holders and have the institutions like banks, pension funds, and insurance companies absorb the losses.

    But government workers, including police and fire will get a serious haircut before it all falls out. The next wave of protestors will not be the poor looking for a handout.

    They will be middle class voters.

  35. Grayfoxgreen says:

    Greetings Everyone!!
    Absolutely Outstanding NEWS,Mac!!! 4****!!

    Just watched a local news station “rehash” it’s 5 A.M. news broadcast at noon.Foxy News was only slightly better in that the weather was more current.Neither one had ANY info but the local murders worth seeing.
    I’ve seen a video I think was on Blacklisted that showed the Comptroller for the Cook County(which includes Chicago)who listed the retirement liabilities that have for years been UNDERFUNDED massively by the local Elected Government officials for police,firefighters and other muni employees.The figures were astoundingly awful and depressing.Would have never heard about these without you and BL.
    Keep up the fine reporting!!!
    If Foxly did half as good we would be hearing far more about Ron Paul and the shenanigans on Wall Street and Washington and less about the latest starlet misadventures on a airline.
    Very Best to All
    GFG

  36. Geoff-UK says:

    “Tenticles”?

    Nobody uses spell-check anymore. And it’s totally, 100% free.

  37. Copout says:

    There is no spell check on an Android phone, sorry its hard to type on these phone, have a nice day in the U.K.!

  38. That’s way more clveer than I was expecting. Thanks!

  39. Scott says:

    Government runs out of money because it pays people to have babbies and not to work and for being partially physically disabled and for having drug addictions and among other excuses, not working. While having to layoff thousand’s of government workers including.police. the unions who forced the governments to pay extremely high wages and impossible pensions and.benifits complain that the non working need help basically spreading the wealth is good for everyone right? Well it appears that unions cannot rape companies and govermemts for too long before the money runs out trying to take.care of the non- working people and the over-compensated union worker. What you dont realize is that the working non-union worker out there actually creating.profits for companies are the largest contributors to the revenue stream that keep your utopia boat afloat and those revenues are shrinking because those workers and companies are coming south the right to work states where your unions dont exist. See example of south carolina. Also refer to wisconsin as.a.way to fix your problems. Good luck.