Wednesday, December 24, 2014

Illinois: the Deadbeat State,,,and Beyond

Gerald Skoning writes at WSJ:

The Land of Lincoln has accrued a $111 billion unfunded liability for government workers’ pensions—up 75% from five years ago. There is an additional $56 billion of unfunded debt to cover health benefits for the state’s retirees. Illinois today is already spending more of its general fund on pensions than on K-12 education. One in four tax dollars pays for its retired workers’ benefits. Last year the state had to defer paying $7 billion owed to contractors. All this after Democrats in 2011 raised income taxes and corporate taxes by 67% and 30%, respectively...

The level of debt is staggering. According to a recent report by Statista Inc., Illinois residents owe $24,959 each as their share of the outstanding bonds, unfunded pension commitments and budget gaps the state has accumulated...

It is no wonder that 850,000 people have left Illinois for other states in the past 15 years, according to the Illinois Policy Institute. Or that Illinois has become one of the most business unfriendly states in the country (40th in a recent Forbes survey)...

Crushing debt isn’t just Illinois’s problem. According to State Budget Solutions, America’s 50 state governments collectively owe $5.1 trillion, including outstanding bonds, unfunded pension commitments and budget gaps. California has by far the largest debt—$778 billion—more than twice that of No. 2, New York, with $387 billion in red ink.

County and local governments also are huge debtors. The Cook County treasurer notes that the county’s numerous local governments have a debt load of more than $140 billion. Of course, Uncle Sam is the worst offender in the deficit-spending Hall of Shame. The federal debt is more than $17 trillion and increasing by $4 billion a day. Every citizen’s share of the debt is $58,604.

The $17 trillion federal deficit is the tip of the iceberg. The U.S. has nearly more than $115 trillion in unfunded liabilities, principally in entitlement programs such as Medicare and Social Security. That’s $1.1 million per U.S. taxpayer.

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