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Conservatively Speaking

State Senator Mary Lazich (R-New Berlin) represents parts of four counties: Milwaukee, Waukesha, Racine, and Walworth. Her Senate District 28 includes New Berlin, Franklin, Greendale, Hales Corners, Muskego, Waterford, Big Bend, the town of Vernon and parts of Greenfield, East Troy, and Mukwonago. Senator Lazich has been in the Legislature for more than a decade. She considers herself a tireless crusader for lower taxes, reduced spending and smaller government.

If you think things are bad in Washington.....

Economy, State budget, Taxes

 

Most Americans would assuredly agree that our debt dilemma is out of control. The debt clock looks like something in a Las Vegas casino. Take a look. …over $13 TRILLION and growing fast.


As of this writing, the debt per citizen is an incredible $42,303, the debt per taxpayer an astonishing $118, 635.

Of course, by the time you read this post, those numbers will have increased even more.

Economic experts predict that if fiscal matters don’t improve, the United States could be facing a Greece-like bankrupt scenario.

Lawrence Kadish wrote in the Wall Street Journal during October 2009, “If you think those town hall meetings over health care were fierce, wait until Americans come to understand the threat to our national financial survival posed by the interest on the government's credit card. It is the interest on the national debt that makes our future unstable. In stark but simple terms, unless Americans are made aware of this financial crisis and demand accountability, the very fabric of our society will be destroyed. Interest rates and interest costs will soar and government revenues will be devoured by interest on the national debt. Eventually, most of what we spend on Social Security, Medicare, education, national defense and much more may have to come from new borrowing, if such funding can be obtained.”

As devastating as the national debt is, astoundingly, Wisconsin’s debt history is worse.

The nonpartisan Wisconsin Taxpayers Alliance (WISTAX) reports, “S
tate and local debt in Wisconsin grew faster than federal debt over the last 19 years.”

Can’t be, you say as you scratch your head? According to WISTAX:

State debt rose 316%, an average of 7.8% per year, from $2.71 billion in 1990 to $11.25 billion in 2009.

Local general obligation debt was up 284%, a 7.3% average, from $3.41 billion in 1989 to $13.1 billion in 2008.”

Compare the above with federal figures compiled by WISTAX:

Federal debt held by the public averaged annual increases of 6.2% per year for a total increase of 212.8% from 1990 through 2009.”

Wisconsin debt increased more than federal debt over the same time period by more than 100 percentage points. How did it happen?

WISTAX explains, “About 40% of the state increase was due to $1.6 billion of tobacco bonds issued in fiscal 2002 that were funded by a stream of payments from tobacco companies, as well as $1.8 billion in appropriation bonds issued in fiscal 2004 to pay unfunded state pension and sick-leave liabilities. The tobacco bonds were issued to help balance the 2001-03 state budget. The bonds were refinanced in fiscal 2009, generating an additional $300 million that was used to balance the 2008-09 general fund. Originally expected to be paid off in 2018, the refinanced bonds will not be paid off until 2029.”

Debt problems were exacerbated when the state raided $1.1 billion from the transportation fund to help balance the state budget. The state, according to WISTAX, authorized $815.5 million of general obligation debt to partially replace the transportation funding that was transferred.

Revenue bonds issued for transportation projects also compounded the state’s debt crisis that, unbelievably from a percentage perspective, is worse than Washington’s.

Read more from WISTAX.

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