Green Room

Ouch! Total State Debt Tops $4 Trillion Dollars, California Ranked the Worst

posted at 8:39 am on September 3, 2012 by

In a year of fiscal instability, the report concerning the debt taken on by all fifty states doesn’t provide a better picture.  In fact, “for the third consecutive year, State Budget Solutions examined state debt and calculated the total amount of debt that each state faces. This year’s report shows that aggregate debt across the 50 states amounted to $4.17 trillion.”  Cory Eucalitto of State Budget Solutions wrote on August 28 that:

California again trumped other states with a $617 billion debt. California’s debt is more than twice the size of New York‘s state debt, and New York has the second largest total debt burden in the nation. TexasIllinois, and New Jersey rounded out the top five states with the most debt. Although New York and Texas moved up one and two spots, respectively, the states with the five largest debts remained unchanged from last year’s report.

Vermont has the least amount of debt of all fifty states with a $5.8 billion state debt. North DakotaSouth DakotaWyoming, and Nebraska follow Vermont with the smallest debt burdens in the country.

My sympathies go out to every resident in California.  Governor Brown has added an additional $7 billion dollars to the state deficit.  California currently faces a $16 billion dollar deficit, which is why a new tax increase measure will be on the ballot this November.  “Brownie, you’re doing a heck of a job.”

Courtesy Of State Budget Solutions

Courtesy Of State Budget Solutions

While Eucalitto wrote that the total state debt dropped from $4.24 to $4.17 trillion, he notes that the unfunded liabilities within the state pension and entitlement programs make up half ($2.8 trillion) of all the accumulated debt.  We conservatives know this issue, but it always falls on deaf ears with those on the left.  When liberals pitch their “reforms,” it’s either laughable or so weak as to not damage the Democrats’ cozy and parasitic relationship with big labor.

However, Eucalitto reported that the 2011 market value pension liabilities haven’t been released– so SBS is using 2010 figures.

Unfunded liability figures from the Pew Center on the States rely on much of the same data that states use to continually underfund their pension systems. While market-valued liabilities total $2.8 trillion, the latest traditionally calculated figures total only $760 billion in unfunded pension liabilities. Total state debt using these figures is still over $2 trillion, but a comprehensive view of state debt without accurately assessed public pension liabilities disguises the problem to the tune of as much as $2.1 trillion.

States and other sources have not yet released market value pension liability figures for fiscal year 2011. Therefore, this year’s report uses the same market-valued pension liability figures first published in 2010 and used in the previous year’s report. Even so, growth in traditionally calculated unfunded pension liability totals indicates that were updated numbers available, aggregate state debt would have continued to increase.

Other areas that contributed to this mess were health benefits, leases,unemployment trust loans, state bonds, annual shortfalls, and other “post employment” benefits owed to public sector employees.  It’s destroying the fiscal health of our states.  Yet, Barack Obama wants to impose the largest tax increase in history when Obamacare is fully implemented.  That’s on top of the tax hikes he wants for the job creating and investing class, which will do nothing for job creation.

Welcome to Obamanomics 101. Furthermore,Democrats want no changes to our current entitlement system, which will soon destroy our financial future altogether.  Furthermore, California and New Jersey have proven that tax hikes solve nothing in curbing deficits, debt, and creating jobs.

The only good indicator is that in states where Republican governors were elected in 2010–their unemployment numbers dropped cumulatively at a rate faster than the national average. Furthermore, our policies have proven to have brought back the economic vigor this country has desperately tried to resurrect with no help from the crushing, regulatory boot of the Obama administration.

Gov. Scott Walker of Wisconsin took a $3.6 billion dollar budget deficit and turned that into a $154 million dollar surplus. Gov. Chris Christie signed a bipartisan pension reform bill that will save the state of New Jersey $122 billion dollars over the next thirty years.

For liberals who think conservatives aren’t serious about fiscal reform and responsibility–are either willfully ignorant or stupendously stupid.  It’s time to get our debt under control.  Hopefully, a Republican wave will bring in more conservative governorships and a Romney presidency where we can work in tandem to curb our fiscal crisis on all levels.

 

 

 

 

Recently in the Green Room:

Blowback

Note from Hot Air management: This section is for comments from Hot Air's community of registered readers. Please don't assume that Hot Air management agrees with or otherwise endorses any particular comment just because we let it stand. A reminder: Anyone who fails to comply with our terms of use may lose their posting privilege.

Trackbacks/Pings

Trackback URL

Comments

I think debt per capita would have been useful here. Seems that the large states have the most debt and the small states the least. Well no crap! Per capita could really tell us who is doing a good job fiscally.

Donald Draper on September 3, 2012 at 9:47 AM

At the suggestion of Mr. Draper, here’s a quick compilation per capita debt, using 2010 Census data.

High end:
NJ: $29,252
IL: $21,067
CA: $16,386
NY: $15,416
TX: $11,139

Low end:
NEB: $4,250
SD: $7932
ND: $8,943
VT: $9,333
WY: $12,193

I also checked NH which is fairly fiscally conservative but with a bit larger population that VT.NH: $8,599.

Wyoming’s per capita indebtedness should include it in the top list.

SJBill on September 3, 2012 at 11:24 AM

What puts California at the top of the special states in terms of the cluelessness of their voters is when most of the rest of the nation was waking up to the danger in 2010, the California Voter swept the Democrats into total domination of State government.

While the debt numbers for NJ (for instance) have some chance of getting better, the numbers for CA are destined to keep soaring for at least a few more years.

By then crashing and burning will be the only way ‘out.’

fadetogray on September 3, 2012 at 11:58 AM

The problem is that California can even begin to fix it until it realizes it has a problem.

And for those of you who are wishing Cali would fall into the ocean, 90% of all goods from China, S.Korea, The Philippines, Taiwan and Japan, as well as 75% of the goods from South America come though California ports. WalMart, Target, Home Depot (just to name a few) as well as pretty much every grocery store’s produce section from November to March would be gone.

Yeah, it’s messed up. But California is the Führerbunker of liberalism.

MunDane68 on September 3, 2012 at 12:02 PM

The recently passed state worker “pension reform” pushed by Brown was nothing more than a cheap ploy to trick voters into approving Prop 30 tax increases, which have been on a track to failure.

The pension bill only effects future hires, and is thus irrelevant until 2050, as well as being easily repealed once the low information voters go back to sleep after the election. The unions howled and cried of course, but it appeared to be a coordinated effort to convince voters that the unions were taking a hit so they should chip in more taxes.

The bright spot is that the bankruptcy courts have taken a less charitable view of the unions demands. Stockton had its pension obligations cut significantly.

In Socal public safety unions have taken to mob style tactics to smear reform minded city council members. Look up “Jim Righeimer” for more.

At some point there’s no more money, and it will be fun to watch how it plays out. Many of the indoctrinated sheep haven’t gotten their backsides burnt quite badly enough yet to wake up to the financial disaster around them. Brown of course hopes for a DC bailout.

Kungfoochimp on September 3, 2012 at 1:08 PM

At some point there’s no more money, and it will be fun to watch how it plays out.
Kungfoochimp on September 3, 2012 at 1:08 PM

There is plenty of money, hundreds of trillions, quadrillions even, of untapped money. Just waiting to be consumed by the people of today. It is wonderful, and you never have to worry about paying for something today. Just charge it on other people’s children’s future earnings. It is simple. So simple even a Senator from Wisconsin can think it up.

astonerii on September 3, 2012 at 9:56 PM

astonerii on September 3, 2012 at 9:56 PM

That is how the Dem sheeple of California have been taught to think. I know some of them. I can’t wait to see their crestfallen expressions when the pension tsunami collapses the state’s finances. My guess is that they will blame all those “evil”, and occasional, Republican governors they’ve had despite the state Senate and Assembly having been under Dem control since the 80s and 60s respectively. The state is full of children in adult bodies.

Kungfoochimp on September 3, 2012 at 11:58 PM