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Drowning in debt, Connecticut faces budget crunch

Renae

Renae

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HARTFORD (Reuters) - Connecticut, home to hedge fund billionaires alongside cities mired in poverty, is racing against the clock to pass a budget or face further spending cuts to education and municipal aid across the state.Nearly two months without a budget, Connecticut is getting crushed by a burdensome debt load that has squeezed spending and amplified legislative discord.
State lawmakers must agree on a biennial budget soon or else Governor Dannel Malloy's executive order to slash state aid to municipalities and eliminate school funding for some districts will go into effect in October. The state faces a $3.5 billion deficit over the next two years.

Connecticut has piled on debt to bolster its public pensions, selling $2.3 billion of bonds in April 2008.
And again in December 2009, the state sold $916 million of economic recovery notes to close a budget deficit after depleting its rainy day fund during the Great Recession.
By many measures, Connecticut's debt levels are the worst of the 50 U.S. states.
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https://www.reuters.com/article/us-connecticut-debt-idUSKCN1B318N

Another state imploding under the weight of public pension plans that are underfunded and over promised.
 
AliHajiSheik said:
"Economic recovery notes", brought to you by the government euphemism office. All they need to do is to keep using these notes and they will be out of debt in no time.
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It's actually scary how bad their debt and economic situation is.
 
Connetcticuts debt is couch change compared to California's

Cali's public pension liabillities were 6 billion in 2003. By 2016 it had risen to 245 billion and rose another 22 percent from 2016-2017

Last I heard it was 346 billion and its only 346 billion because Cali is projecting a extremely optimistic 8 percent return on their pension investments

Theyre actually have close to 1 Trillion dollars in unfunded pension liabilities.

Makes you wonder what the real motivation is behind the new interest its succession

If Cali exits the Union it can create it own soverign currency and float that currency in forex markets and create its own monetary policies to deal with its crippling debng

Will it work ? Hell no, they would still be beholden to the tax and spend polocies that got them in this mess in the first place
 
Renae said:
https://www.reuters.com/article/us-connecticut-debt-idUSKCN1B318N

Another state imploding under the weight of public pension plans that are underfunded and over promised.
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Eh...no:


In the biggest picture, Connecticut is a victim of two huge trends—first, the revitalization of America’s great rich cities and second, the long-term rise of hot, cheap suburbs. But Connecticut’s cities are not rich or great; its weather is not hot year-round; and its cost-of-living is not low. The state once benefited from the migration of corporations and their employees from grim and dangerous nearby metros, but now that wave is receding. To get rich, Connecticut offered a leafy haven where America’s titans of finance could move. To stay rich, it will have to build cities where middle-class Americans actually want to stay.
 
Gimmesometruth said:
Eh...no:


In the biggest picture, Connecticut is a victim of two huge trends—first, the revitalization of America’s great rich cities and second, the long-term rise of hot, cheap suburbs. But Connecticut’s cities are not rich or great; its weather is not hot year-round; and its cost-of-living is not low. The state once benefited from the migration of corporations and their employees from grim and dangerous nearby metros, but now that wave is receding. To get rich, Connecticut offered a leafy haven where America’s titans of finance could move. To stay rich, it will have to build cities where middle-class Americans actually want to stay.
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You're right, you got me to see the err of my ways! It wasn't over spending and debt leveraging it was people LEAVING THE STATE. Gosh it is so clear now!! They should just raise taxes more to solve their problems, and make it illegal to move out. That's the ticket!
 
Renae said:
You're right, you got me to see the err of my ways! It wasn't over spending and debt leveraging it was people LEAVING THE STATE. Gosh it is so clear now!! They should just raise taxes more to solve their problems, and make it illegal to move out. That's the ticket!
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When an article lays out, in terms simple enough for you to understand, it really isn't necessary to act as if I wrote it and then to try to put words in my mouth. Hint: Try re-reading it, understand that there are ebbs and flows in the macro....and that sometimes you ought to keep from jerking yer knee.
 
Gimmesometruth said:
When an article lays out, in terms simple enough for you to understand, it really isn't necessary to act as if I wrote it and then to try to put words in my mouth. Hint: Try re-reading it, understand that there are ebbs and flows in the macro....and that sometimes you ought to keep from jerking yer knee.
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You posted an article that says it's not government spending to blame.
 
Renae said:
You posted an article that says it's not government spending to blame.
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Um, you don't have to keep proving you did not absorb the article, I got that...trust me.
 
Renae said:
I'm sorry, you apparently didn't absorb mine or you wouldn't have posted yours.
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Uh, they spoke to the same issues:

Among the wealthiest in the United States, Connecticut has been strained by already high taxes, outmigration, falling revenues and $50 billion of unfunded pension liabilities.

They wanted to focus on "unfunded liabilities" and not go too far in depth on the changes in employment/income for the vast number of citizens. As a matter of fact, there wasn't much depth to the article at all, but then that is the audience it was shooting for.
 
Gimmesometruth said:
Uh, they spoke to the same issues:

Among the wealthiest in the United States, Connecticut has been strained by already high taxes, outmigration, falling revenues and $50 billion of unfunded pension liabilities.

They wanted to focus on "unfunded liabilities" and not go too far in depth on the changes in employment/income for the vast number of citizens. As a matter of fact, there wasn't much depth to the article at all, but then that is the audience it was shooting for.
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Personal insults, typical. I think we're done here.
 
Renae said:
Personal insults, typical. I think we're done here.
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They have been there all along, you just realized that the article you pointed to wasn't the be all and end all. Big projects, like schools and jails, require long term planning that depends on stable jobs and increasing populations. As stated, CT has been caught out by the resurgence of NYC and Boston, massive changes in middle incomes/jobs...and the resultant declines in populations, particularly working age. No one has a crystal ball, fortunes can change.
 
Gimmesometruth said:
Uh, they spoke to the same issues:

Among the wealthiest in the United States, Connecticut has been strained by already high taxes, outmigration, falling revenues and $50 billion of unfunded pension liabilities.

They wanted to focus on "unfunded liabilities" and not go too far in depth on the changes in employment/income for the vast number of citizens. As a matter of fact, there wasn't much depth to the article at all, but then that is the audience it was shooting for.
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Renae said:
Personal insults, typical. I think we're done here.
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He's right, Renae. It's not the gov't that's the problem, it's unions. Without them jacking up pensions to draw in members to get more union dues to use to buy political power, Conn. wouldn't have a problem with their debt. Of course, without the union/Dem. gov't partnership, none of this would be possible.
 
faithful_servant said:
He's right, Renae. It's not the gov't that's the problem, it's unions. Without them jacking up pensions to draw in members to get more union dues to use to buy political power, Conn. wouldn't have a problem with their debt. Of course, without the union/Dem. gov't partnership, none of this would be possible.
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Uhm, the government is the one doing the dealing with public sector unions.
 
faithful_servant said:
He's right, Renae. It's not the gov't that's the problem, it's unions. Without them jacking up pensions to draw in members to get more union dues to use to buy political power, Conn. wouldn't have a problem with their debt. Of course, without the union/Dem. gov't partnership, none of this would be possible.
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Renae said:
Uhm, the government is the one doing the dealing with public sector unions.
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Yeppers....
 
Renae said:
Uhm, the government is the one doing the dealing with public sector unions.
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And I would not be surprised if "the govt", like many states, was underfunding the pensions and instead gambled that stock investments would make up the difference. But that is not the base problem, it is just a simple answer for simple folk.
 
I don't see the terror in Connecticut's situation. According to the article, CT spends and borrows on the state level while other states spend and borrow on the local level. The effect on the taxpayers is the same-- whether debt is in bucket A or bucket B makes no difference.

In the end, this is all manageable in a wealthy state.
 
Gimmesometruth said:
And I would not be surprised if "the govt", like many states, was underfunding the pensions and instead gambled that stock investments would make up the difference. But that is not the base problem, it is just a simple answer for simple folk.
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That last line, is another personal insult. I'm not insulting your intelligence, stop insulting mine.
 
Renae said:
. I'm not insulting your intelligence,
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Yeah, when you start of the debate with me by putting words in my mouth, you do. When you refuse to critically read the article I refer you to, you do. When you come into an econ forum and post trite rw garbage, you do. Please don't act like partisanship is fair.
 
Typical of many threads on a similar subject, liberals will do anything to avoid admitting admitting that Big Government is the problem.
 
Gimmesometruth said:
Yeah, when you start of the debate with me by putting words in my mouth, you do. When you refuse to critically read the article I refer you to, you do. When you come into an econ forum and post trite rw garbage, you do. Please don't act like partisanship is fair.
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WOW... I am astounded at your line of reasoning.

I came to this forum with information that I find interesting for a discussion, you posted an article from the Atlantic, a partisan site. You asked me to wade through your article and find the same conclusions as you do. I do not. For that you insult my intelligence, for that you accuse me of being simple because I don't conclude the issue the way you do.

If you want an echo chamber, this isn't the site for you.
 
Gimmesometruth said:
Yeah, when you start of the debate with me by putting words in my mouth, you do. When you refuse to critically read the article I refer you to, you do. When you come into an econ forum and post trite rw garbage, you do. Please don't act like partisanship is fair.
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Also I didn't put words in your mouth, I mocked the article. Quit saying things which are not accurate.
 
Renae said:
WOW... I am astounded at your line of reasoning.

I came to this forum with information that I find interesting for a discussion, you posted an article from the Atlantic, a partisan site.
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and yet, you have not shown the article to be partisan...at all.
You asked me to wade through your article
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No i did not, I said try to absorb it.
and find the same conclusions as you do. I do not.
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Good grief, that is the last thing I would expect, let alone "ask". What I did do was to show both articles pointed to the same macro trends.
For that you insult my intelligence, for that you accuse me of being simple because I don't conclude the issue the way you do.
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I said the article you pointed to was shallow, if that what you want, go for it.

If you want an echo chamber, this isn't the site for you.
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I'm more than willing to debate the issues within the articles, with or without you.
 
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