Professor Ayer Comments on State Budget for SF Chronicle

Professor Jack Ayer commented on California's budget problems for an article in the San Francisco Chronicle assessing whether the state could be categorized as "bankrupt."  States cannot actually declare bankruptcy, the article notes, so the meaning of the term with reference to their fiscal solvency is open to interpretation.

Professor Ayer stated that a fair measure of an insolvent state would be if its assets were worth less than liabilities and it could not pay all of its bills, which could mean that there would be banks no longer lending money to the state.

"The banks are happy to keep lending - they don't want to stop - but if they aren't going to get paid back, they are going to stop," Professor Ayer said.

John D. Ayer is a professor emeritus at the UC Davis School of Law and an expert on bankruptcy law.

San Francisco Chronicle article