you know what this is? this is kimberly s lip gloss. dire time for dire measure. a rhode island city is living that now. they re declaring bankruptcy. the city has cut contract with the police, firefighters and municipal workers. the city said they had no other choice but to file chapter 9. let me put context about this. five in this economic downturn that filed bankruptcy and this is not new. generally when this happens a state moves in to take over a city. this is not unusual and it s sad. somebody has to pay bills. eric: point this out, ronald reagan bad economy, you mean when carter gave him horrendous economy? and double digit unemployment and he turned it in to
bob: quiet. you know what this is? this is kimberly s lip gloss. dire time for dire measure. a rhode island city is living that now. they re declaring bankruptcy. the city has cut contract with the police, firefighters and municipal workers. the city said they had no other choice but to file chapter 9. let me put context about this. five in this economic downturn that filed bankruptcy and this is not new. generally when this happens a state moves in to take over a city. this is not unusual and it s sad. somebody has to pay bills. eric: point this out, ronald reagan bad economy, you mean when carter gave him horrendous economy? and double digit unemployment and he turned it in to
we have to make sacrifices. there has to be pain and sacrifice. pat buchanan, tom touched on it today, a county on long island being taken over by the state of new york. because it s insolvent. you look at the situation in connecticut, and other states that were supposed to be wealthy states, the new york times today saying they are awash in debt. this is a crisis. a crisis of epic proportions for us economically. it really is. you hear about the back rooms of congress, they re talking about a proposal whereby states like california and illinois can go chapter 9, which means they can simply, you know, basically default and write down their debt, municipal bonds and things like that. that s going to have an impact on the municipal bond market. as we mentioned, meredith whitney said expect 50 to 100 counties, cities or communities to go belly up and default on
pay the debts. reporter: it s extremely rare for a large municipality to go bully belly up and laws m it difficult for cities to file for bankruptcy known as chapter 9, but the downturn has more considering the worst-case scenario from jefferson county, alabama, to detroit, san diego and even los angeles. the economy is not getting better. we have high unemployment and the dollar is weak. the government spends way too much money at the federal level and the state level. the federal government is funneling tons of money in the state to keep them afloat which in turn gives it to local government. with i ll see more of this. reporter: the new mayor of harrisburg inherited the debt and said she is considering other options first, including downsizing government, raising taxes or selling assets including parking garagarages. this is a very complex issue. we didn t get here overnight and we re not going to be able to solve it overnight. reporter: debariclareing bankruptcy is consid
pay the debts. reporter: it s extremely rare for a large municipality to go bully belly up and laws m it difficult for cities to file for bankruptcy known as chapter 9, but the downturn has more considering the worst-case scenario from jefferson county, alabama, to detroit, san diego and even los angeles. the economy is not getting better. we have high unemployment and the dollar is weak. the government spends way too much money at the federal level and the state level. the federal government is funneling tons of money in the state to keep them afloat which in turn gives it to local government. with i ll see more of this. reporter: the new mayor of harrisburg inherited the debt and said she is considering other options first, including downsizing government, raising taxes or selling assets including parking garagarages. this is a very complex issue. we didn t get here overnight and we re not going to be able to solve it overnight. reporter: debariclareing