$1.8 Trillion Annual Deficit – The Problems with Biden’s Budget

Angry Grizzly BearWith gratitude to the National Conference of State Legislatures (NCSL), their analysis of the proposed budget was broken down, and some sense was made.  Not that the news is logical, acceptable, or palatable, just that the budget documents were broken down, which was helpful.  We start with the most bass-ackwards aspect of the budget by asking one question, “Where is the money supposed to come from?”

The 2022 Budget Proposal left President Biden’s desk requesting Congress to spend $6 Trillion and add $1.8 Trillion in new deficit spending to the bloated debt the government already owes.  “Who is going to buy the bonds and make money on this debt?”  When a person employs a search engine, asking this exact question, many answers come forward, and some do not make any sense.

Peter Schiff stated:

The government doesn’t have money that it doesn’t take. Any dollar that the government spends is a dollar that the private sector can’t spend or can’t invest. The government has to take money out of the economy before it can put it back in. Nobody seems to understand this basic point because they see the Fed creating money, and they think, well, we just print money. They don’t realize that when they print money, they destroy the value of the money that’s already there. So, they’re not adding new purchasing power. They’re just redistributing it” [emphasis mine].

Thus the first problem with America’s debt and proposed budget transparent; there is no money that government can spend unless it first forcefully removes it from the owner.  That is theft, or as we recently discussed, legalized theft.  The Supreme Court of the United States (SCOTUS) has ruled that legalized plunder, legal theft, or forced taxation are the price we pay for civilization, thus making legal the government’s actions to steal money.Government Largess

Let me be clear; I am not an economist.  I select several very bright and experienced people to help explain things to me.  However, I can help others with less interest in economics understand what is happening in America right now to answer the question put forward, “Who is buying America’s debt instruments?”  The simple answer is that the Federal Treasury is buying the debt instruments, as the whole world sells their bonds and other American debt instruments.  What the Federal Reserve is doing is called “monetizing debt.”

Monetizing Debt

Gravy Train 3The definition of monetized debt is as follows. “Debt monetization or monetary financing is the practice of a government borrowing money from the central bank to finance public spending instead of selling bonds to the private sector or raising taxes. It is often informally and pejoratively called printing money or money creation.”  Money can only be created in two ways: selling products and services and lending money where the borrower pays interest.  While there are many different debt instruments, i.e., credit card, home loan, student loan, bonds, Treasury Notes, etc., the principle remains the same: you either sell goods and services to make money or lend money and make money on the interest.

Why does monetizing debt matter?

Two simple reasons the government allows debt to be monetized.  To hide debt, it doesn’t want the public to know about, and to absorb cash on the market as a tool to fight inflation.  Here’s the problem, there is too much debt on the government’s books to hide it from the public any longer.  Add to that the sheer volumes of cash in the marketplace after handing out money during COVID, and the Federal Reserve will monetize debt.  Even if the chair of the Federal Reserve denies monetizing debt, debt is being monetized.Burning money - THE JOSIAH BARTLETT CENTER FOR PUBLIC POLICY

In short terms, your pocketbook is going to take another hit on the chin, and possibly two.  First, your interest rate on privately held debt, credit cards, student loans, homes, etc., is going to go up, all while making lenders nervous and refuse to lend money.  Second, inflation is already making the dollars held less valuable.

Inflation first; inflation is the devaluation of dollars.  The government floods the marketplace with cash, and the currency you hold will drop in value.  For example, recently the inflation was reported to have been 4.6% higher year-over-year.  This announcement was made in April 2021, so all the money you earned last year suddenly became 4.6% less valuable this year, all before the interest rate increases affected those dollars.Inflation - 8 Things Everyone Ought To Know.

Case in point, the US Government sent me $1000 in January; I held onto those funds due to a move that was coming and spent the money in June.  However, between January and June, inflation moved up at a steady pace, and when I went to spend that $1000, it was only worth $850.  That is the power of inflation in your pocket.

Have you asked for a credit increase recently and been denied?  What about your credit limits on your credit cards, have they shrunk?  Both are indicators that the lenders refuse to lend due to the tremendous risks caused by fiscal insanity in the Federal Government.  What about home loans, have you had to produce more documentation, prove more income, and work harder to qualify for a loan?  What about student debt?  The government controls the lending of student debt.  Even here, the Federal Government cannot demand a lender loan money to student’s and many students have found their college expenses grow, and their ability to borrow shrunk.Inflation pickpocket | Cayman Compass

In a simple fact of life, every household in America understands perfectly. When your credit scores go down, your ability to borrow reduces, and it becomes harder to meet all your bills every month.  Every city, county, state, and even the Federal Government should know this lesson, but they refuse to believe problems arise when credit scores go down.  All because those elected believe they can tax some more, and the money magically appears.

Does money magically appear in your pocket; of course not!  It must be earned through working, selling goods and services, or trading your time for employment with an employer for a paycheck.  Does the law allow you to write blank checks, kite checks, backdate checks, or simply float a check waiting for a future payday; of course not!  Yet, this is what the government is doing right now with your money.  The government is spending money, promising the lenders that a future payday will be theirs, but the government has to spend money to get money.  Does that excuse work for you when the electric company, gas company, cellphone, and other bills arrive?A Helpful Chart : How Inflation Changes Mortgage Rates

The most heartbreaking statement I have heard in a long time was recently made by a physician’s assistant, who claimed, “Aren’t we all just one paycheck from disaster?”  The simple truth, mostly, yes!  Studies exist that talk about financial resiliency in America.  Financial resiliency is all about being able to weather a patch of trouble without losing your possessions in bankruptcy.  The conclusions were all but unanimous. Along with most industrial nations, America has no financial resiliency due to government fiscal policies that hinder saving money and the need to live on credit cards to keep the basics of life paid for each month.

When inflation is stealing the value of your money, no wage can compete with government theft, all before taxes.  Add in tax laws that are counter-productive, job-killing, and increase the cost of doing business, and the job you have becomes tenuous at best.  Add in the hidden debts the government is trying to hide, and nobody in America is making money.

QuestionWhat about those who consider themselves “Rich?”

The same problems you are having with inflation are the same problems everyone is having with inflation.  Let’s go back to my $1000 that became $850 through six months of inflation.  We all spend the same money, and inflation is killing everyone’s dollar equally!  Hence, I beg you, do not allow the media hype about rich versus poor to derail the point.  Inflation and monetized debt are killing the US Dollar, which is why so many foreign investors have dumped their US Debt instruments for safer financial shores.

While some people have more financial resiliency than others, everyone’s dollar is dropping in value.  Inflation and low financial resiliency mean making budget cuts to charities, hiring someone to maintain a lawn, and a host of other ways and means American’s share our money.  It can mean turning off services, weighing how much fuel can be used, and a host of other belt-tightening decisions.  All things the government should first be doing, and they refuse.24+ Inspirational Quotes For Unemployed - Audi Quote

Yours and my liberty and freedoms depend upon stable economic policy, firm fiscal policies, and elected officials scrutinizing the government for waste, fraud, and abuse.  Yet, what do we regularly find; fraud, waste, and abuse!  The Department of Defense has lost multiple trillions of dollars; not a single politician is asking for an audit and an explanation or is willing to withhold additional appropriations until the lost money is accounted for.  The Department of Veterans Affairs continues to mismanage funds, misappropriate funds, and waste money like overripe fruit; yet, still, we have zero interest from the politicians elected to scrutinize government.

I repeat Peter Schiff, only for emphasis:

The government doesn’t have money that it doesn’t take. Any dollar that the government spends is a dollar that the private sector can’t spend or can’t invest. The government has to take money out of the economy before it can put it back in. Nobody seems to understand this basic point because they see the Fed creating money, and they think, well, we just print money. They don’t realize that when they print money, they destroy the value of the money that’s already there. So, they’re not adding new purchasing power. They’re just redistributing it” [emphasis mine].

Inflation Quotes | Inflation Sayings | Inflation Picture Quotes - Page 2In redistributing your money, the government has proven they are the problem, and the solution begins locally!  Change your mayor, city council, county board, school boards, and every other elected official.  Getting the local governments in fiscal shape allows state governments to begin practicing fiscal health and sanity.  Then, we put people into the Federal Office more interested in scrutinizing the government than in writing endless laws and abdicating their legislative role to the executive bureaucrats and the judicial branch.

Knowledge Check!The budget put forth by President Biden is the height of insane, and I have only covered less than 1/10th of the budget problems in this article.  Granted, I covered the most egregious problem, but the fact that the legislative branch is even negotiating a compromise is beyond insanity and borders on criminal negligence!  We, each citizen of a representative government, must stand and tell our representatives NO MORE!  No more fiscal insanity, borrowing to buy votes, entering into debt obligations that make captives of unborn millions of other people.  No more will we allow them to buy votes to maintain power.  End the financial abuse of the taxpayer; your wallet will thank you!

© 2021 M. Dave Salisbury
All Rights Reserved
The images used herein were obtained in the public domain; this author holds no copyright to the images displayed.

NO MORE BS: Have You Heard?

DutyThe following is a recap of several stories that should have been big news, but since the corporate media is practicing “Biden Behind Covering” (BBC), I doubt this news was heard anywhere.  However, this information is critical, and I have included the links if you want more than my paltry summation of the story.  I encourage you to always hit the links included in the articles I publish, so you know where I get my source materials.

Judge for yourself the importance of the following, but I encourage you to judge wisely, for America is in deep trouble!

Inflation Definition: Formula & How to CalculateFrom the NCSL regarding the future of finance, we find a curious article, “Do State and Local Governments Need to Worry About Inflation?”  The simple answer is absolutely, as the continuing pension crisis will be multiplied as inflations grows.  How much is inflation up, a year ago inflation was 4.2% less than it is today.  But that is a statistic that doesn’t carry the real weight of the problem.  If you owed $100 last year, without interest calculations, you now owe $4.20 more.  That $10.00 steak is now $10.42, before taxes.  That tank of fuel, before all the taxes, is $0.42 more expensive than a year ago, and inflation was already hurting America.  The way inflation works is comparable to running on a freshly waxed floor in your socks, you have to exert more effort to maintain your same spot, forget slowing down, or stopping for that will include falling.  Let me reintroduce you to a term used in the early 1970s, stagflation.  Stagflation occurs when the inflation rate is so out of control, no new jobs are created, employers are looking to cut employees left and right to maintain shareholder profits, and the entire economy grinds to a messy halt.

Inflation may erode PTI's political capital - Newspaper - DAWN.COMRisk managers across the financial system are looking at the government on the Federal, State, and Local levels and are not liking what they see as inflation continues to grow beyond the Federally approved 2% annual allowed rate.  As taxes adjust for increased inflation, it will require more money to pay taxes to maintain current levels, as inflation depletes the value of dollars saved.  Thus, every government is looking at their “Rainy Day” funds, and are watching it depreciate as inflation increases, and this is happening before a penny is even spent.

VaccineFrom SHRM, we find the next astounding piece of news, the “EEOC Gives the Greenlight for Limited Incentives for COVID-19 Vaccinations.”  Mandatory vaccinations are illegal in the United States, currently.  However, incentivizing vaccinations by an employer has now been made acceptable.  Do you see a problem with this EEOC ruling?  Did you notice how slippery the slope is between employers incentivizing vaccinations and mandatory vaccinations?  During periods of higher inflation, how much value is $500, from an employer to vaccinate?  Other employers are allowing employees to sticker their badges showing they vaccinated and can stop wearing a mask in public.  No sticker, you have to keep your mask on.  Slippery slope?  Colleges, K-12 Schools, and other organizations all have a hodgepodge of rules for mingling in a post-COVID government mandated lockdown, as the “New” normal.

Do you see the problems with employers picking winners and losers based upon vaccination status?  How long before those who cannot, or will not, be a guinea pig for a useless vaccine, that is shrouded in mystery, and which has zero long-term studies completed, for a viral disease with a 99.02% chance of survival, are shown the door because of risk averse insurance policies?  I have some concerns with this decision and remain convinced that the EEOC has been bought and paid for by parties unknown.  Their last several decisions have left me seriously concerned.  Watch the bureaucrats, they are sneaky!Plato 2

Virginia Allen, writing for The Daily Signal, provides the next piece of news that should be wall-to-wall with parents marching.  “California Public School Gives Third Graders Assignment About ‘Place on Gender Spectrum.’  Let that sink in for a moment.  9-year-old students are being asked to choose where they place themselves on the “gender spectrum.”  What the heck is a “Gender Spectrum?”  At 9-years old, I was more interested in getting better at little league than I was about anything else, except my paper route.  A quote from the article sums the problem nicely:

The school board is completely indoctrinated. Many teachers are completely indoctrinated. … You cannot change their mind. The only thing you can do is vote them off [the school board] and let them know there are consequences to teaching children inappropriate things for their ages.”

When your politicians are no longer afraid of the citizens they afflict, tyranny has begun to reign!  California is a perfect example of what happens when the populace checks out, the politicians stop fearing the ballot box, and power concentrates under a single party.  Now, ask yourself, is this the America you want for your kids and grandchildren?  I know my answer!Apathy

Cal Thomas also writing for The Daily Signal, presents the scariest topic of all, “Ministry of Truth 2.0.”  Consider for a moment, you make a comment in a grocery store, an off-hand comment to another person, the next day a person from Homeland Security is knocking on your door to discuss your passing of disinformation, who possesses the legal authority to place you under arrest, no evidence needed, and you are guilty until reluctantly allowed to be innocent.  From the article:

Secretary of Homeland Security Alejandro Mayorkas is reportedly considering the development of tools that would help America’s children discern truth from lies and know when they are being fed “disinformation.”

Millstone of Designed IncompetenceIf you have not read, or listened to, George Orwell’s book 1984, you might not recognize “the Ministry of Truth,” which is the propaganda arm of the government who rewrites history to what the government says it is, and not what actually happened.  Would someone please explain to me who appointed the Homeland Security Secretary the harbinger and decider of truth and lies?  When the media cannot even get the truth right, how will a government, senate appointed, person who serves at the pleasure of the current sitting US President know, recognize, or even understand truth?  When the media allow truth to be “subjective to circumstances, environments, and cultures,” how will bureaucrats be able to discern truth?

Tell me, how will the tools be protected from the bias of the tool designers?  One of the biggest issues in modern research is researcher bias; yet somehow the secretary of Homeland Security can magically control bias to protect the tools from the opinions, knowledge, experiences, and politics of the designers.  Exactly how will this occur?  Do you recognize how slippery this slope is, and how dangerous?Why

As a homeowner in a town that is within 50-miles of the southwest border, the continued blind-eye being turned to the southern border infuriates me.  Please, follow this link, and then consider what is being said.  Do not look at the politics of the situation, do not listen to the political leaders and political commenters.  Listen to your heart, your gut, your conscience, and tell me, if the 9-year old girl was your sister, cousin, daughter, what would be your response?  From the article we also find the following:

The cartels are making an ungodly amount of money on a daily basis, somewhere to the tune of $15 to $25 million a day in just the trafficking and smuggling of human beings. That doesn’t include the narcotics. We’re seeing, for example, fentanyl, 5,000% increase in fentanyl coming across the border.”

America Is Crying Digital Art by Deborah VicinoWant to hear the truth about the problem on the southern border, let’s talk about “got-aways.”

Got-aways” are individuals that are crossing the border illegally that don’t want to get caught. They don’t want to go through processing because they are either a gang member, someone on the terrorist watch list, a convicted sex offender, [or] a violent offender. These are people who know that once they are caught, they will get turned right back around because of their record, because they have a record in the United States.”

From January to June, the Border Patrol, through all their efforts, have lost around 200,000 “got-aways.”  These are people seen on cameras, who have eluded apprehension, and are now roaming American streets.  A convicted sex offender was given a small baby to help him cross the border.  Where the parents of this child are, no one knows.  So, even when they get caught, we still have problems getting rid of the vermin mixed into this humanitarian crisis.  How many terrorists from non-South and Central American countries have slipped through as “got-aways?”

Knowledge Check!America is being taken for a ride by the Cartels who run the Southern border!  This is the truth, and anyone trying to tell you something else is selling snake oil and trying to make a buck off the tragedy that is the US Southern Border.  Like all evil and conspiring people through history, the innocent are the shields covering the criminal actions, these children deserve better, but they will never have a future until America becomes a land of laws again, where the Rule of Law is honored.

Child Abuse - New Day Advocacy CenterCan you hear the Statue of Liberty weep at how are laws are being manipulated by the drug cartels, for the glorification of single-party rule and fiscal return on investment?

© 2021 M. Dave Salisbury
All Rights Reserved
The images used herein were obtained in the public domain; this author holds no copyright to the images displayed.

NO MORE BS: Come, Let Us Reason Together – Chapter 5

Bait & SwitchIn Chapters 2 and 3 of this series, the discussion regarding money and the $350 Billion dollars COVID relief monies were discussed.  As this is a continuing discussion, I would encourage you to read those missives as well for a fuller understanding of the principles being discussed.  Regardless, several facts remain pertinent:

      1. The states accepting this money will be bound to spend it in a manner the Federal Government specifies.
      2. The money being given to the states as a “stimulus for COVID economic growth,” will not spur anything but inflation and poor fiscal policies.
      3. The strings attached to this money are a noose on individual state economic growth long after the deadline to spend the money (31 December 2026) comes and goes.

Doherty (2021) writing for the NCSL (National Conference of State Legislatures) provides some clarity on the Treasury Department’s rules and regulations regarding this $350 Billion albatross being forced down the state’s throats.  The funds being discussed originate in the $1.9 Trillion American Rescue Plan Act, and the Treasury Department has released operational guidance to the states and cities receiving the funds.  Never forget, while the Treasury Department claims there is an algorithm for sharing the money, politics and political connections will be the final determinant in who receives how much of the funds being doled out.

The Duty of AmericansPensions are the first point of discussion as to where these funds can go; never forget, pensions remain the largest single expense for states in the United States.  Those bloated governmental salaries, negotiated by unions, and put in place by legislative fiat, keep the taxpayer on the hook for poor financial planning long after the initial beneficiaries of the union retirement pyramid scheme and dead and buried.  Read carefully the pension data provided by USAToday for a full and detailed discussion on just how big the pension problem is for the states of the United States.

Millstone of Designed IncompetenceJust as important, look at the total number of government workers as a share of the total workforce, and you will discover just how big your state and local governments have become.  For example, two states selected at random from the 50-state list, New Jersey, and New Mexico are displayed below, and sourced from the article:

New Jersey

  • Funded ratio: 38.4%
  • Total pension shortfall: $130.7 billion shortfall (3rd largest)
  • Gov’t workers as share of total workforce: 13.3% (20th lowest)
  • Avg. annual payout per public retiree: $32,148 (9th highest)

New Mexico

  • Funded ratio: 61%
  • Total pension shortfall: $18.2 billion shortfall (18th largest)
  • Gov’t workers as share of total workforce: 18.6% (4th highest)
  • Avg. annual payout per public retiree: $20,907 (15th lowest)

ApathyConsider New Jersey for a moment, if you met 100 new people in one day, more than 1/10th of those met will work for the state or local government in some capacity, and those 11 people are earning $32,148 taxpayer paid dollars a year for being retired.  Worse, New Jersey is kiting checks on your children’s future to the tune of $130.7 Billion dollars every year.  Raising taxes cannot help closing the funding gap in the pension.  Want more news, the majority of those retired are not living in New Jersey, so all those taxpayer monies are not being recouped in sales taxes, property taxes, and other taxes.

Yet, the Federal Government just borrowed $1.9 Trillion to give the states $350 Billion, and the monies provided will not even pay a years’ worth of pension payments in most cases.  Let alone pay for all the other accounts that have been stripped to pay for the pension gap.  For example, infrastructure (Roads, Bridges, Highways, Broadband Internet, the Electrical Grid, etc.), Teachers, Community Colleges, Unemployment Insurance, Water and Wastewater Treatment facilities, and Health and Human Services, just to name a few cash strapped state programs.

Plato 2A few days ago, I was discussing broadband Internet grids, and there susceptibility to failure with people who work for a major Internet Service Provider.  In Umatilla County, as an example, the Internet either currently, or previously, went down nightly for 5-6 hours at a time.  Read the outage reports and you will find regular large geographic areas of the country suffering with Internet latency and connectivity issues.  Yet, your state legislators must focus not upon the potholes damaging your car, not upon shaky bridges and overpasses prone to failure, but upon pensions for retirees.  All due to labor unions and promises that should never have been made in the first place!

Pensions are the number one reason I, personally, think that government workers should not be able to unionize, and that the government pensions should be as rigidly controlled as the private sectors pensions.  Yet, the inverse is true, unions growing in the public sector, shrinking in the private sector, and the taxpayer is left with the bill.  Since the government can continue to kite checks, our children’s great grandchildren are already up to their necks in debt that is unsustainable.

Plato 3Come, let us reason together for solutions that actually work.  I offer below the following suggestions, feel free to agree, disagree, add more, and discuss openly in the comments.  We, the owners of government, must re-take control of the government, and to do so, we must communicate and act.

      1. Reduce the size of government immediately to the size posted on 31 December 1999. This is an immediate and interim step.  To be followed by a position by position, value discussion, where technological solutions to replace workers is decided.  Eventually culling government size back to a Pre-1930’s level.
      2. Automate as many functions as possible. The processes of how government function are necessarily complicated to justify a jobs program.  This culture of complication must cease forthwith, the processes cleared of unnecessary complications, and streamlined to allow for automation of the processes.
      3. Take the pensions and eradicate the unions. Privatize pensions should be the letter of the law for all, public and private sector employees.  Thus, creating a new market and investment industry.
      4. Privatize public maintenance of roads, the fuel taxes are sufficient to pay for this and improve road maintenance immediately.
      5. Privatize wastewater and water generation and distribution.
      6. Privatize and deregulate all utilities, allowing for maximum competition, and ending the private geographic monopolies the tech companies and Internet providers have established.
      7. Privatize K-12 and Community Colleges changing the pay structures for teachers and reducing the “staff” positions. Get focused on delivering a product, the product is an educated student who can read, write, and do math, thinking logically, and critically.  This means ending the surplus of standardized tests and putting the teacher in charge of the classroom.

PatriotismNever Give Up!Not every child should be forced into college.  Not every job requires a college degree.  Opening the community colleges produces certified, trained, and non-debt laden students that are workforce ready.  Workforce ready means able, willing, and skilled in working, be that in academia for a degree, or in the workforce as a tradesman the requirement is the same and the distinction needs removed from the leaders of K-12 educational leadership.

The aim and the intent of all government programs is to get out of the way and let people act as they think best for themselves and their families.  Not pushing children to college for a degree and a life of debt payments.  Not forcing them into the military because you are too lazy to teach them how to read, write, think, and speak.  Not forcing them into poverty to support a government jobs program.  The government will not go “quietly into that dark night.”  But, with enough insistence the government we currently know can be cut, reduced, and forced to retreat.  We, the citizens, need to take back our government through the ballot box, through the judicial branch, and through demanding change in the legislative and executive branches at all levels of the government.

Knowledge Check!First step, believe it is possible; live like it has already occurred.  Second step, join others to raise the cry and demand the changes.  Third, support only candidates who already live fiscally proper, morally upright, and ethically dedicated.  Fourth, never give up!  Never lose focus, and never relinquish the moral high ground for a bowl of pottage or 30 pieces of silver.

© 2021 M. Dave Salisbury
All Rights Reserved
The images used herein were obtained in the public domain; this author holds no copyright to the images displayed.

No MORE BS: A Worthy Resource and Government Funding

VirtueI am a nerd; when it comes to data, I am a sponge.  I tell dad jokes because they make me laugh.  I have many resources for these articles, and I generally do not share my resources, as I find many people are not as nerdy as I am when it comes to the issues surrounding America.  I also find abbreviating stories fun and hope they are helpful for others who need information but do not have time to track all the data sources I follow as a  nerd.

I am going to recommend the following resource and getting on their email list.  The National Conference of State Legislatures (NCSL) is an organization that works to help state legislatures work better.  The NCSL Mission is all about increasing independence and integrity in state legislatures, and I have been very happy to gather and use data from this source.  When I found this resource, I immediately signed up for their email list and occasionally receive state legislature news that is considered “local” or not “worthy” of corporate media reporting.

Ziggy - How Government Should Have to RunA critical activity of the NCSL is training state legislators to operate in their elected roles more fully.  Training has been a concern of mine for many years due to how America selects its elected representatives.  I do not want more bureaucracy, but junior legislators need mentoring, training, and having a network dedicated to watching, reporting, and offering help in training is a critical niche market for Americans to produce more trust in government and those elected to scrutinize the government.  I do not want, and I think America could use, a lot less, lawyers as elected representatives.  Thus, I promote the NCSL’s efforts to help.

My congratulations to the Executive and Legislative Branches of Indiana, you appear to be working well together, and I hope this trend continues.

“The revenue forecast Indiana received is good news and comes on the heels of a decade of fiscal discipline that is paying off in a big way for Hoosiers,” said Senate Appropriations Committee Chair Ryan Mishler, R-Bremen, in a statement [emphasis mine].
House Speaker Todd Huston said the legislative leaders hope to use the extra $2 billion to pay off state debt, give public and private schools funding, and make one-time investments.
Just one year ago, the pandemic entered the ring and seemed to deliver a knockout punch to our booming economy. Our near-record-low unemployment of 3% skyrocketed to a record-breaking high of 17% in a short period. Now, Indiana is not only bouncing back but winning the fight,” said Huston, R-Fishers, in a statement.Government Largess

Now, here is the bitter pill in the good news posted above by the NCSL.  A question has been percolating in my head since writing the series of education articles, Here, Here, and Here, “Where do states get their money?”  With the continuing changes to state tax law, where the state is stealing county and city government tax revenue for school budgets controlled at the state level, more questions continue to percolate.  I do not like the answers I am getting.

Hence, we introduce the information gleaned to inspire action in a more informed manner and understand the relationships between funding government on the state level and the incestuous relationship on the federal level.

Detective 4We find the following article from PEW: “Where States Get Their Money: FY 2019.”  The report contains a graphic that spells out the problems quite well, and I encourage you to visit, find your state, look at the sources, and ask questions!  Averaging all the states, 49.1% of a state’s funding arrives as tax dollars directly.  31.4% arrives as funding from the Federal Government.  However, this is not a good indicator of the incestuous relationship between the federal and state levels of government.  Not all states are equal in receiving federal funds or the reasons for acquiring those funds.  11.3% arrives in state coffers as service charges for teachers’ licensure, building permits, and other executive branch-controlled service charges.  7.4% originates in a miscellaneous category (discretionary funds), which is a problematic category, as political payoffs are paid out of many a miscellaneous fund.  Finally, 0.8% arrives from local funds, or the cities and counties are forwarding funds to the state for various reasons; for example, taxes on homes meant for local public schools but have to be filtered through the state coffers.

Thankfully, no single state is 100% funded by the federal government.  However, FY 2019 definitely should raise some eyebrows and questions in Alaska, Louisana, Montana, and Wyoming, as to why these states top the list for receiving federal funds.  The top 10 receivers of federal funding are Mississippi, Arizona, Kentucky, Tennessee, Missouri, and Alabama.  The states receiving the lowest funds are Hawaii, North Dakota, Virginia, Kansas, Utah, and Iowa.  Also, a category needing more questions asked, scrutiny, and a lot more answers using audits and third-party auditing to explain.

ApathyPlease note, I am only using PEW reported data; I do not know how these numbers were collated, I do not have access to the raw data, or see the bias built-in by humans when reporting numbers through statistics.  I can only report the numbers and hope people take action by asking questions.  FY 2019 needs examined quite heavily as the past is a prelude to the future.  Unfortunately, the past being a prelude to the future is especially true where government funds arrive and depart in any level of elected representation.

© 2021 M. Dave Salisbury
All Rights Reserved
The images used herein were obtained in the public domain; this author holds no copyright to the images displayed.