NJ Is In The Very Best Of Hands
Wile E Coyote is firmly ensconced in Trenton
Dec. 4 (Bloomberg) — New Jersey taxpayers are being saddled with a bill of about $657,000 a month from Bank of Montreal for an interest-rate swap approved by state officials and linked to bonds that were never sold.
The 11th-largest U.S. state by population, which is cutting expenses to close a $1 billion budget deficit, will pay Canada’s oldest lender $23.5 million. The sum, about the same as the salaries for 113 teachers over three years, will allow it to avoid a $50 million penalty for canceling the contract, which was tied to planned sales of school-construction bonds.
The interest rate swap, an agreement between borrowers to exchange fixed and variable-rate payments on a set amount of debt, was arranged in 2004 to protect taxpayers against rising borrowing costs. The strategy backfired after officials decided against issuing the securities.
…The payments, which work out to $21,892 a day for three years, show how elected and appointed officials failed taxpayers by agreeing to financial strategies they didn’t fully understand. New Jersey spent $21.3 million in 2008 to exit three contracts signed when James Florio and James McGreevey were governors. The state’s transportation trust fund is giving almost $1 million a month to a Goldman Sachs Group Inc. partnership in an agreement linked to bonds that were redeemed.
Great; we’re paying a pension to Goldman…
Biz, Politics | Mr. Bingley | 
December 4, 2009 3:27 pm
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The politicians running these governments- state,local, and Federal- are basically unqualified to run ecven a Boy Scout troop.Those qualified have been scared off due to the intense Media rape of anyone in the public eye.So, we’re left with guys with nice smiles,who talk well-but are frigging treasonous idiots.
Your shortfall is ONLY one large! Out here we would kill for that shortfall. We have been cutting and cutting and cutting and we’re still not DOWN to that yet. That would be the Governor Janet shortfall I might add. She is not running a Boy Scout Troop but merely the Department of Homeland Security.
The Governor of Washington (a Democrat, alas) is proposing tax hikes after a series of budget cuts. This is so the state “safety net” won’t “unravel”.
Which just tells me, they haven’t cut enough. I will be communicating with my representatives on this one.
Don’t we have a governor who made his fortune selling bonds to Jersey while he was running Goldman?
Nah. Just a coincidence.
It is OK. Christie got elected. Time to put blind faith back into the system.
While Christie will almost certainly be an improvement over Corzine (he’d have to work really really hard to be worse) there is absolutely no reason to have blind faith in our elected officials.
None.