The local government "if" bankruptcy and how

In the southern United States Alabama most populous Jefferson county population November 9, after a vote, declare bankruptcy. The county to the bankruptcy of scale 4.1 billion dollars, a history of the United States the largest case in local government. The Jefferson county bankruptcy is far more than 1994 hit California's orange county $1.7 billion debt of the record company. Continued economic malaise has made the United States local financial suffered a crushing defeat, New Era Hats the current U.S. state and local government debt has reached record levels, there have been many municipal bankruptcy faced dilemma. Maybe someone will say, change is in China, such as the United States the Jefferson county the bankruptcy of the local government will not appear nine times out of ten. Because of always, so-called local government "bankruptcy" case before in China. Although domestic some local government debt, or insolvency, but who refused to face the local government "bankruptcy" the reality. Local officials and experts think, local governments will not bankruptcy also will not allow its bankruptcy. This is so, borrowing of local government officials like an eating sides, leverage and use more bold on and casual, regardless of the consequences. And the local government of the huge debt, whether the 2008 financial crisis broke out, or now, are standing in a black and white cat regardless, on the basis of municipal and the transport infrastructure investment, it is the local government financial behavior, by financial expenditure to financing, but "the market", want to rely on bank loans to support. According to the national audit office in June this year issued a report, the local government has 10.7 trillion yuan of debt, much of which is a bank loan. Although the Numbers still may be underestimated, but this is equivalent to 2010 gross domestic product (GDP) of 27%. There are a large part of the debt in the government have decision-making in 2008 for counter global recession affect, and ordered two years during mass stimulating investment. So, local governments on how these loans pay? The most effective way is to sell the land-now a quarter of the local government debt to depend on income from to pay it off. In 2010, for example, when the local government should repay debt is as high as 2.5 trillion yuan. But the fear is that in the current macroeconomic policy, domestic real estate has severely affected and the house prices began to drop significantly. Once the real estate market bubble, house prices and land price has greatly decreased, and the local government of the bank loans have been unable to pay, and its debt is likely to become a bank, the occurring of bad loans. From the decline due to income, the local government itself exists the problem of shortage of funds. The government make project development, the construction enterprise of default money; Construction enterprise default "labor contractor" money, "labor contractor" is the default of peasant workers' wages; Migrant workers some commit suicide by hanging, some jump off a building. It is a woman has been blessed in chongqing to meet in the research of the place of the central leaders, reflect his own husband's salary is overdue, successfully get the wages. And more migrant workers are not so lucky, and some on the violence of the debt collection pathway. Before long, the state council research center, a report said the local government debt crisis is beyond financial risks, and become a social stability and economic security of the primary enemy. For years, governments at all levels to take a positive measures to alleviate the risk, it should be said, improved. But, when the economic situation is the emergence of a new situation, can you keep this ease up? Local government faces test, I'm afraid acceptance. Of course, because China's political structure, local governments generally won't appear such as the Jefferson county that typical bankruptcy forms, but the financial crisis will also place the affairs of the serious threat. If for an enterprise that, may have to apply on their own or declared bankruptcy court. However, most of the local government manger son ble en herbe, but still living well. In fact, NFL Jerseys no clear for bankruptcy doesn't mean is a good thing, it often can make a financial crisis can't get enough reveal, the result is not a long time crisis over. Considering the domestic political and economic structure, and the central government will back for the local government debt. But don't know how many of these debts into the occurring of bad loans, will, it is not clear how many will be specific central finance to assume. Most loans are investing in traffic, municipal and other return of the infrastructure are in the field of high investment projects. And these loans of 20% to 30% of the highest proportion of the risk is bigger, especially small and medium-sized cities in financing platform had borrowed loans. In order to give local government alarming, the central government is trying to have some, such as allowing individual has the force local government also like America's local government that "if" bankruptcy, or allow the place National People's Congress can give full play to the function of supervision and local government, for those who borrow blind, already can't normal operation of the local government announced its "bankruptcy". Through these measures, forcing the local government had to save money, had to give up the costly the achievements of the engineering, only in this way, the frequency of the bankruptcy of local government to really saved.

see more:Real estate in breathing
Why someone nag about China save the debt