Tuesday, April 2, 2013

"Emerging Majority" Drives Stockton, CA into Bankruptcy

Stockton, CA now has the distinguished identification of being labeled the nations largest American city to go into bankruptcy, thanks to U.S. Bankruptcy Judge Christopher Klein.
"It's apparent to me the city would not be able to perform its obligations to its citizens on fundamental public safety as well as other basic government services without the ability to have the muscle of the contract-impairing power of federal bankruptcy law," Klein said.
Stockton was one of the first cities to be hit by the diversity recession.  Mortgage foreclosures had hit the cities property values especially hard.  It became so bad the city became known as "Foreclosureville, USA" and had been labeled the most miserable city to live in by Forbes magazine.  These falling property tax receipts forced the city to issue bonds in 2007, more than a year before the nationwide economic collapse, to help meet pension obligations.  Those bonds have put the city in a billion dollar whole.

Today, Stockton has one of the highest crime rates in the country.  They are also suffering an unemployment epidemic, with unemployment rates at nearly 16%.

Stockton's economy is built around the agriculture industry.  As such, they have been a prime destination for illegal immigrants.  So much so, that the city has seen it's non-Hispanic white population drop from 57.1% in 1980 to 22.9% in 2010.  The largest shift occurred in just the past 10 years with whites dropping from 43.7% in 2000.

Hispanics now make up the city's largest demographic at 40.3%.  Meanwhile, over the last 3 decades, the population of Stockton has nearly doubled, going from 149 thousand in 1980 to over 290 thousand in 2010.  Thus, the reduction in the white demographics share of the population can't be attributed to white flight, instead it is do to mass immigration from Hispanics.

In order to meet the economic demands put on the city by this wave of mass immigration, the city has cut employment, health benefits, and renegotiated public employee union labor contracts.  They've even slashed the police department to a level where they can only respond to emergencies that are actively in progress.

Now, thanks to this judge's order, the city's pensioners will be forced to take another hit.  All so the city can continue to supply free services to it's rising illegal immigrant population.

Joe Gazzardi, senior writing fellow for Californians for Populations Stabilization, put the city's problems succinctly,  "Too many people, most of them immigrants from distant countries who had no capacity to assimilate and, worse, didn’t know that the bountiful free services they received were not, in fact, free."

Al Lewis, in describing Stockton as the most miserable city in America for Forbes magazine echoed this idea, "An overly optimistic and undereducated people, electing ignorant and misinformed leaders, piling up debt, until the one day when they can’t."


Anonymous said...

That unemployment rate you cite for Stockton is depressing. If these are the children and grand children of the immigrants who only came to the US to 'do the jobs that Americans wouldn't do', then why won't their kids do those jobs as well? With unemployment rates that high in the Central Valley, the government should not let any more illegals or guest workers into this nation until the farmers start to hire those already there. If their parents worked the fields, they can too.

Anonymous said...

Actually... the Okies and Asians were doing "the jobs Americans won't do" until they got scabbed out of Ag work by the illegals. Just as you hear Hispanic (and other) Americans say they're been driven out of construction. and meatpacking. and retail. and landscaping. and ...

About Stockton: the U6(real) unemployment rate is over 20%. The city went broke in part by paying 25% above market & hiding the fact.
Pensions are huge, but maybe not ultimately. The "lifetime medical crashed & burned, retirees got a penney on the dollar for it.