Bankruptcy does not just happen to families; it also can happen to states. According to the Associated Press, the Minnesota government was forced to shut down Friday, July 1, for the second time in 6 years after Minnesota lawmakers could not reach an agreement for the state’s budget.
According to a statement issued by the Republicans and the Senate Majority Leader Amy Koch they believed that the governor gave up too soon and considered his decision to stop negotiations two hours before the deadline was a “major disappointed.”
“We met several times in order to bridge the gap between our differences over more complicated areas of the budget and left thinking that a budget agreement was imminent. Unfortunately, Gov. Dayton has chosen to prioritize his rigid, tax-and-spend ideology, rather than prioritize the best interests of Minnesotans as we move into the holiday weekend,” said Koch.
The Governor, Mark Dayton, held a press conference to announce the stand-off, declaring, “This is a night of deep sorrow for me.” The governor and member of the Democratic-Farmer-Labor party have been pushing to raise taxes on the wealthiest 1.9% members of the state and to cut spending.
Temporary funding measures were proposed by the Republicans which would allow the legislature to continue to negotiate an agreement, but the Democratic-Farmer-Labor party opposed their effort accusing the Republican party of refusing tax hikes and favoring millionaires over other lower income Minnesota residents.
According to Ken Martin, a Democratic-Farmer-Labor chair, “Minnesotans deserve more than what the GOP has forced upon them with this government shutdown. Our state’s residents deserve much more than the devastating cuts to education, health care, public safety, and other vital services that the Republicans are digging in their heels to enact.”
This is not the first time the state has had to suspend services. In 2005, under the leadership of Tim Pawlenty, the state also had to shut down.
It will not take long for Minnesota residents to feel the impact. The state government shutdown will force state boards and agencies to close and the Minnesota Department of Transportation to shut down, closing 80 highway rest stops. The state’s zoos and parks will also close.
The Minnesota court system, the prison system and the police departments will not be impacted by the shut-down.
Filing for Bankruptcy
States become bankrupt for the same reason that individuals or families can become bankrupt. The amount of income that is generated by each party is less than their expenses causing a financial crisis.
The economic crisis has hurt governments and families. If you have suffered a divorce, unexpected family death, medical crisis or high credit card debt, you may be bankrupt and unable to pay your bills.
Unlike a state that must suspend government services, you may have legal options to discharge certain qualifying debts by filing for bankruptcy protection.
Filing Chapter 7 Bankruptcy may allow you to immediately discharge most of your debts including medical bills and credit card bills. Filing Chapter 13 Bankruptcy may allow you to create a 3 to 5 year debt repayment plan and restructure your debt payments.
Hiring a Bankruptcy Lawyer
Not all individuals will qualify for bankruptcy. If you are considering filing for bankruptcy you should contact a bankruptcy lawyer who can review your financial situation and help you determine if bankruptcy is right for you.
Bankruptcy is a serious financial decision and should not be made without first understanding all of the financial ramifications of your decision.
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