VIDEO: State Finances
Tuesday 14 June 2016 / Hour 1, Block C: Veronique de Rugy, Mercatus (George Mason University), in re: Fiscal solvency of the states within the US. The worst US states for economic condition? Illinois, New Jersey, Massachusetts, Connecticut; New York, Maine California and PR. A bill opening union contracts, which constitute a major part of PR’s problems. To work, need a really strong control board. Also, special interests have got huge benefits for many years; need to tie their hands so actual member get the benefit/ If you can’t do these things, then I'd be against bankruptcy. The real level of unfunded liabilities: PR is completely in the red— dramatic – but Connecticut isn't far behind. Said that 49% of pensions and benefits are unfunded. What kind of discount? Oops – higher than 49%; in CT, using 7 or 8% — that’s crazy. They overspend, overtax, overpromise public employees and use acctg gimmicks to show an incorrectly small unfunded liability CT is ‘way over 49% . . . Cook Co jails: they hold people in detention for two or tree years for minor crimes; here’s no control even though they often walk away after court. Returns to the unhealthy marriage of the govt and special interests. We need to clear up debt to GDP: mostly reforming transfers and the pay of public employees. Also: 80% of fiscal adjustments fail because they continue catering to special interests. Scott Walker: teacher’s unions and __. His labor plan was very important.
Florida has a healthy fiscal condition (is now No.6). It dropped because Nebraska has been going up. FL rates very high on cash solvency: have a lot of cash on hand to cover short-term liabilities. Also rank high in how taxes and spending are in connection with . . . No. 11 is Ohio, a big, populous statw that’s doing well in comparative fiscal solvency. However, it uses a lot of fiscal gimmicks.