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States by Fiscal Condition

bballcrook21
Posts: 4,468
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8/8/2016 1:06:29 AM
Posted: 3 months ago
The Mercatus Center has released its annual ranking of each state"s financial health based on debt, unfunded pensions, healthcare benefits, and other key fiscal obligations. The states were quantitatively analyzed in five separate categories, as described by Mercatus:

1. Cash solvency. Does a state have enough cash on hand to cover its short-term bills?

2. Budget solvency. Can a state cover its fiscal year spending with current revenues, or does it have a budget shortfall?

3. Long-run solvency. Can a state meet its long-term spending commitments? Will there be enough money to cushion it from economic shocks or other long-term fiscal risks?

4. Service-level solvency. How much "fiscal slack" does a state have to increase spending if citizens demand more services?

5. Trust fund solvency. How much debt does a state have? How large are its unfunded pension and healthcare liabilities?

Several observations on the data:

As is often been the case, states run by fiscally conservative governments take better care of their financial health than the more liberal tax and spend states. There are many diverse reasons for this, not least of which are public union pension obligations, which grew when times were good but have become unsustainable as the economy slows. Liberal governments also tend to offer more generous, and expensive, entitlements, often to the point that they can't afford to pay them when they grow.

TOP FIVE STATES

Alaska, Nebraska, Wyoming, North Dakota, and South Dakota rank in the top five states. It's important to note that the data on which these rankings are based is from FY'14, because states are notoriously slow in releasing economic data. Which means states like Alaska which are heavily influenced by the oil industry performed better at that time but have since seen budget pressures from falling oil prices.

BOTTOM FIVE STATES

Kentucky, Illinois, New Jersey, Massachusetts, and Connecticut rank in the bottom five states. Each exhibits serious signs of fiscal distress massive debt obligations, unfunded liabilities and healthcare benefits, and high deficits.

The bottom line is that governments that spend profligately, often to their own short-term political benefit, often wreak fiscal havoc upon their states when economic conditions shift, while those who follow a more laissez-faire approach to the economy perform better over the longer term.

Source: http://mercatus.org...
If you put the federal government in charge of the Sahara Desert, in 5 years there'd be a shortage of sand. - Friedman

Underlying most arguments against the free market is a lack of belief in freedom itself. -Friedman

Nothing is so permanent as a temporary government program. - Friedman

Society will never be free until the last Democrat is strangled with the entrails of the last Communist.
triangle.128k
Posts: 3,630
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8/8/2016 8:30:31 AM
Posted: 3 months ago
At 8/8/2016 1:06:29 AM, bballcrook21 wrote:
The Mercatus Center has released its annual ranking of each state"s financial health based on debt, unfunded pensions, healthcare benefits, and other key fiscal obligations. The states were quantitatively analyzed in five separate categories, as described by Mercatus:

1. Cash solvency. Does a state have enough cash on hand to cover its short-term bills?

2. Budget solvency. Can a state cover its fiscal year spending with current revenues, or does it have a budget shortfall?

3. Long-run solvency. Can a state meet its long-term spending commitments? Will there be enough money to cushion it from economic shocks or other long-term fiscal risks?

4. Service-level solvency. How much "fiscal slack" does a state have to increase spending if citizens demand more services?

5. Trust fund solvency. How much debt does a state have? How large are its unfunded pension and healthcare liabilities?

Several observations on the data:

As is often been the case, states run by fiscally conservative governments take better care of their financial health than the more liberal tax and spend states. There are many diverse reasons for this, not least of which are public union pension obligations, which grew when times were good but have become unsustainable as the economy slows. Liberal governments also tend to offer more generous, and expensive, entitlements, often to the point that they can't afford to pay them when they grow.

TOP FIVE STATES

Alaska, Nebraska, Wyoming, North Dakota, and South Dakota rank in the top five states. It's important to note that the data on which these rankings are based is from FY'14, because states are notoriously slow in releasing economic data. Which means states like Alaska which are heavily influenced by the oil industry performed better at that time but have since seen budget pressures from falling oil prices.

BOTTOM FIVE STATES

Kentucky, Illinois, New Jersey, Massachusetts, and Connecticut rank in the bottom five states. Each exhibits serious signs of fiscal distress massive debt obligations, unfunded liabilities and healthcare benefits, and high deficits.

The bottom line is that governments that spend profligately, often to their own short-term political benefit, often wreak fiscal havoc upon their states when economic conditions shift, while those who follow a more laissez-faire approach to the economy perform better over the longer term.

Source: http://mercatus.org...

But muh 10%, free stuff, Denmark, and democratic socialism
bballcrook21
Posts: 4,468
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8/8/2016 4:26:04 PM
Posted: 3 months ago
At 8/8/2016 8:30:31 AM, triangle.128k wrote:
At 8/8/2016 1:06:29 AM, bballcrook21 wrote:
The Mercatus Center has released its annual ranking of each state"s financial health based on debt, unfunded pensions, healthcare benefits, and other key fiscal obligations. The states were quantitatively analyzed in five separate categories, as described by Mercatus:

1. Cash solvency. Does a state have enough cash on hand to cover its short-term bills?

2. Budget solvency. Can a state cover its fiscal year spending with current revenues, or does it have a budget shortfall?

3. Long-run solvency. Can a state meet its long-term spending commitments? Will there be enough money to cushion it from economic shocks or other long-term fiscal risks?

4. Service-level solvency. How much "fiscal slack" does a state have to increase spending if citizens demand more services?

5. Trust fund solvency. How much debt does a state have? How large are its unfunded pension and healthcare liabilities?

Several observations on the data:

As is often been the case, states run by fiscally conservative governments take better care of their financial health than the more liberal tax and spend states. There are many diverse reasons for this, not least of which are public union pension obligations, which grew when times were good but have become unsustainable as the economy slows. Liberal governments also tend to offer more generous, and expensive, entitlements, often to the point that they can't afford to pay them when they grow.

TOP FIVE STATES

Alaska, Nebraska, Wyoming, North Dakota, and South Dakota rank in the top five states. It's important to note that the data on which these rankings are based is from FY'14, because states are notoriously slow in releasing economic data. Which means states like Alaska which are heavily influenced by the oil industry performed better at that time but have since seen budget pressures from falling oil prices.

BOTTOM FIVE STATES

Kentucky, Illinois, New Jersey, Massachusetts, and Connecticut rank in the bottom five states. Each exhibits serious signs of fiscal distress massive debt obligations, unfunded liabilities and healthcare benefits, and high deficits.

The bottom line is that governments that spend profligately, often to their own short-term political benefit, often wreak fiscal havoc upon their states when economic conditions shift, while those who follow a more laissez-faire approach to the economy perform better over the longer term.

Source: http://mercatus.org...

But muh 10%, free stuff, Denmark, and democratic socialism

lol
If you put the federal government in charge of the Sahara Desert, in 5 years there'd be a shortage of sand. - Friedman

Underlying most arguments against the free market is a lack of belief in freedom itself. -Friedman

Nothing is so permanent as a temporary government program. - Friedman

Society will never be free until the last Democrat is strangled with the entrails of the last Communist.