Wednesday, July 12, 2017

State Budget Issues Make Headlines



There are some good articles out there on state budget issues. We are looking at articles on budget issues in key states like Illinois, Connecticut, Texas, California and New Jersey.

State budgets are in a trouble because tax revenues(and state incomes) have not grown but the demands have. Only the top 1-2% of income earners have seen growth, yet corporations want tax breaks, civil service employees want pensions and the public wants safety and aid for education.

We looked at the State Credit Ratings and some states have great ratings.  But the state fall into two groups. States with low debts and pension obligations because they historically have not done much for their citizens (south, conservative west and conservative mid-west). 

And states that deliver high government benefits (like education) and have good credit ratings. Minnesota seem be the best managed. Massachusetts is also up there.

Overall, it looks like tough times in northeast and liberal Midwest as growth slows. Both areas may have over promised pensions to civil servants and teachers.

In all jurisdictions (except CA and MA) there is huge pressure from White voters not to raise taxes(tea party) as a code for not helping the poor and minorities.. Most articles also indicate that the top 1% (2%-5%) of income earners has done very well. 


Connecticut

The Atlantic: Connecticut Inequality Vol. 1 <= really good. Discusses how finance does not create middle class jobs



Illinois

Illinois passed it first budget in two years and voted to increase income taxes and sales taxes


Texas


New Jersey

New Jersey Passes Budget thanks to Chris Christie's beach antics.

California

No news in california. The state added money for education and refinanced public pensions.



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