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State budget crises

July 3, 2017 by Jeff (ILoveCapitalism)

These seem to be popping up. For decades, State public pensions have been under-funded and overly-generous. The bill is coming due. Bloomberg has a map:

Gray means nothing good. California, for example, has under-funded its pensions by $1 trillion – or $93,000 per household – which is worse than Illinois.

The big crisis of the moment is Illinois. They have not enacted a budget in 3 years, have $15 billion in unpaid bills, and a court just ordered them to make some large Medicaid payments they had been skipping. In consequence, the Democrat legislature has passed tax hikes – that the Republican governor has vowed to veto, at least for now.

Other states in crisis are

  • Connecticut, where the Democrat governor has signed an executive order to take control of State spending (and do service cuts) after the Democrat legislature couldn’t pass a budget.
  • Maine, where the Republican governor is threatening a government shutdown (and state of emergency) rather than accept another Democrat tax hike.

All of these States face downgrades of their bond ratings.

As to California: it already has some of the nation’s highest tax rates (13% top income, 7-10% sales taxes). With typical “progressive” insanity, CA is spinning on whether to do single-payer health care – a $400B idea that it can’t afford even today, and still less after California’s inevitable pension crisis hits.

Filed Under: Big Government Follies, California politics, Debt Crisis, Socialism in America, State Politics & Government Tagged With: Big Government Follies, California politics, connecticut, Debt Crisis, illinois, maine, Socialism in America, State Politics & Government, taxation is theft

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