> Pulling or cutting the pensions of retired public service workers (many of whom who risked their lives to protect the public) would, beyond the ethical questions, eliminate the credibility of the city's promises
Well, yes. It would be a default. But more money has been spent than is there and there are only three pools to draw from: taxpayers, services and creditors. (Creditors include both pensioners and bond holders.) At this point, multiple pools have to be hosed. It’s just a matter of when and to what degree, with the hosing being less extreme the earlier it’s dealt with.
In all likelihood, the city will go bankrupt and have creditors cut services in federal bankruptcy proceedings, thereby imperilling the city’s long-term tax base. State, being unable to go bankrupt, will probably hose creditors more.
Well, yes. It would be a default. But more money has been spent than is there and there are only three pools to draw from: taxpayers, services and creditors. (Creditors include both pensioners and bond holders.) At this point, multiple pools have to be hosed. It’s just a matter of when and to what degree, with the hosing being less extreme the earlier it’s dealt with.
In all likelihood, the city will go bankrupt and have creditors cut services in federal bankruptcy proceedings, thereby imperilling the city’s long-term tax base. State, being unable to go bankrupt, will probably hose creditors more.