Why “bankruptcy” is a stupid mechanism to get back at public-employee unions

After New Jersey Governor Chris "Powderkeg" Christie mentioned state bankruptcy in connection with health-care costs, New Jersey had to reduce a bond sale (hat tip: a friend in New Jersey). While state officials are denying any connection, this should put a damper on any foolish schemes to declare local or state bankruptcy for the sole purpose of getting out of pension obligations. Most jurisdictions are not Detroit, and the long-term consequence of a bankrupcy declaration is much more expensive borrowing costs. It's tempting to declare nuclear war to get at your adversaries, but this was very, very stupid on the part of Christie. He needs to get a shovel out… again.