U.S. States Carry Insurmountable Financial Burdens
A Sad State of Affairs: U.S. States Carry Insurmountable Financial Burdens
by David Moadel | Oct 4, 2019 | Articles, CTS-News, Macro Economics
If a nation is only as strong as its constituent states, then America is in serious trouble. Some states are in worse shape than others, but unfunded liabilities have gotten so bad that the nation as a whole is threatened with financial ruin.
Truth in Accounting releases a report each year called Financial State of the States, and it’s much more accurate, complete, and readable than anything you’ll see from the U.S. government. I believe it’s every informed American’s duty to seek independent sources on the country’s financial health, and this source has painted a particularly bleak picture.
According to Truth in Accounting’s recently released report, the latest findings indicate that out of the 50 states, 40 of them don’t have enough money to pay their bills – and this is true despite the fact that 49 states require, by law, that they balance their budgets.
The greatest financial burdens on the states are the usual suspects: pension debt (which totaled an astounding $824 billion this year) and other post-employment benefits (which include retiree health-care debt and totaled $664.6 billion this year).
Remember, this is only the individual states’ debts; it doesn’t include the national debt, which is quickly approaching $23 trillion. With these ominous figures, both the states and the country are paying billions of dollars annually just to pay off the interest on the debt; that’s one of the reasons why the government is pushing so hard for a cheap dollar, which would make these interest payments less burdensome.
Altogether, Truth in Accounting identified $1.5 trillion of state-level debt in the span of just one year. This debt burden isn’t distributed equally, however, as some states are in worse shape than others.
Truth in Accounting has coined the term “sinkhole states” for the most egregious offenders, and if you’re thinking that they’re all going to be poverty-stricken localities, you’re wrong:
![image1-sadst[1].jpeg](https://images.squarespace-cdn.com/content/v1/5d5222a44813620001d89582/1570651443434-2P5RG8J0757038GYF8J6/image1-sadst%5B1%5D.jpeg)
You probably didn’t expect to see Connecticut or Massachusetts on the sinkhole states list, but debt burden isn’t biased towards any particular region or demographic segment of the country.
Rather, it’s a function of government malfeasance: elected leaders mismanaging taxpayer funds and kicking the can down the road until the debt burden becomes unmanageable.
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