The staggering bill of our profligate spending of the last thirty years is progressively coming to bear not only on the national level, but on the state and municipal levels as well. A recent study shows our state by state indebtedness is now approaching a trillion dollars and the ability to structure solid payment plans by state legislatures is steadily diminishing. The Pew Center records that only four states are currently in a budgetary position to successfully fund their future pension and health care mandates and their position is rapidly slipping as well.
How did we get ourselves in this ridiculous mess? The old fashioned way – spending without control for processes we had no intent on paying for through the current generation, assuming the growing economy would forever shield and cover our inability to spend within our means, and continuing to elect corrupted politicians who bought re-elections with the votes of monopolizing public employee unions secured with ever more gluttonous pension and healthcare benefits.
The current national hero in the fight for fiscal sanity is the rotund pitbull governor of New Jersey Chris Christie who has been declared mean and a bully for simply stating the obvious- that New Jersey is out of money currently with an over 11 billion dollar current deficit and, spectacularly, out of future money with over 100 billion of unfunded mandates to public services and employee unions. the bad news? – New Jersey is only one of many states in this situation of intolerable budget choices, and that the bill may come due as early as next summer.
This next summer is the time that many state and municipal bonds come due in states that are approaching default status. It may well be that one of the most secure forms of investment by major banks may go the way of default similar to the loans related to the housing collapse of two years ago, leaving many banks highly vulnerable and over leveraged. Can you say double dip recession?
HotAir.com presents an important sixty minutes video that is worth the initial commercials and every bit of its extended view. Hopefully the recent elections put enough adults in place that the day of reckoning does not come forth without an eventual day of salvation.