The Fiscal Future Looks Grim for State and Local Governments
Article from For Liberty by Norm Leahy.
We all know the federal government has a spending problem. With every trillion dollars added to the $23 trillion national debt (you can watch it grow in real-time here), our children and grandchildren are made a little bit poorer, and a lot less secure.
But as the Government Accountability Office notes, Uncle Sam isn’t the only one struggling with spending. State and local governments are having more difficulty paying their own bills. And that problem is only going to get worse. What’s behind it?
GAO’s simulations suggest that growth in the sector’s overall expenditures is largely driven by health care, with states’ share of Medicaid spending as the primary driver. These expenditures are projected to grow more than GDP each year. Employee compensation, the largest share of operating expenditures, decreases as a share of GDP during the simulation period. Health benefits are the only component of employee compensation that increases as a percentage of GDP.
Galloping health care costs, plus other factors like state and local government pensions, wages, and more, all point to potential problems in the long term…unless changes are made now.
Of course, efforts aimed at convincing government of the need to curb, restrain, or reform spending is usually met with indifference, or worse.
The bills will – inevitably – come due. We can either change course now, and make the repayment more manageable, or allow the political class to keep on spending in our name, consequences be damned.
Image Credit: By Jericho [CC BY 3.0 (http://creativecommons.org/licenses/by/3.0)], via Wikimedia Commons
Our governments, AT ALL LEVELS are SO SELF CENTERED, SO FOCUSED on growing their personal wealth and re-elections, they have lost all site of their OATH of OFFICE. CORRUPTION is the only CONSTANT of our present elected and appointed government officials – and BUREAUCRATS!
Thankfully, Texas had the good sense not to expand Medicaid, since no state could afford it. I feel badly for the people of the states who, mostly led by Democrats, accepted the carrot offered by Obamacare and did expand Medicaid in their states. However, the citizens of those states did elect those Democrats who are leading their states into bankruptcy. Now, I just don’t want Texas to participate in bailing them out.
I agree with all comments. Go0vernments at all levels are out of control. even here where businesses are moving in and the tax base is increasing they continue to raise taxes rather than living within their means. The stupidity in government is ever increasing. The one chore our federal government was originally given was to provide for the common defense and when a president does that, the whiners criticize while never saying a word when an idiot blows up an aspirin factory. The rest of the waste of funds the politicians created on their own. Few care to look at the total tax bill when all taxes fees and dues are added up that we pay for city, county, state and federal taxes so the parasites (politicians and friends) can feed off the taxpayers.