The National debt is over $34 trillion. California has a debt of over $73 billion. L.A. and San Fran will hit the one billion mark in deficits. School districts are breaking. Bottom line? Government in America is dead broke—but making it worse.
“At the end of the fiscal year 2022, 53 cities did not have enough money to pay all of their bills. This means that to claim their budgets were balanced—as is required by law in the 75 cities—elected officials have not included the actual costs of the government in their budget calculations and have pushed costs onto future taxpayers.
Together, the 75 cities had $307.4 billion worth of assets available to pay bills; their debt, including unfunded retirement benefit promises, amounted to $595.3 billion. Pension debt totaled $175.9 billion, and other post employment benefits (OPEB), mainly retiree health care, totaled $135.2 billion.
According to the analysis, the biggest obligation faced by large cities is their pension liabilities, which become more affordable based on the market worth of investments:
The State of California pension debt is north of one trillion dollars. Now, we are inviting in over ten million illegal aliens—and we will feed, cloth, house, give a free education and health care, credit cards, phones and more. We can’t afford to keep criminals in jail—so we import more from other countries.
Forget the National Debt – Most of America’s Big Cities Are Broke
By Ben Kew, RedState, 2/20/24 https://redstate.com/benkew/2024/02/20/most-of-americas-big-cities-are-broke-analysis-finds-n2170396#google_vignette
The opinions expressed by contributors are their own and do not necessarily represent the views of RedState.com.
A majority of America’s largest cities are broke and unable to meet their liabilities, according to a new analysis.
In its eighth annual Financial State of the Cities report, the right-leaning think tank Truth in Account determined that as of 2022, 53 of the country’s 75 largest cities have fewer assets than liabilities.
The report notes:
At the end of the fiscal year 2022, 53 cities did not have enough money to pay all of their bills. This means that to claim their budgets were balanced—as is required by law in the 75 cities—elected officials have not included the actual costs of the government in their budget calculations and have pushed costs onto future taxpayers.
Together, the 75 cities had $307.4 billion worth of assets available to pay bills; their debt, including unfunded retirement benefit promises, amounted to $595.3 billion. Pension debt totaled $175.9 billion, and other post employment benefits (OPEB), mainly retiree health care, totaled $135.2 billion.
According to the analysis, the biggest obligation faced by large cities is their pension liabilities, which become more affordable based on the market worth of investments:
In 2022, the cities continued to receive and spend federal COVID-19 relief funds, and as the U.S. economy reopened, they took in additional tax revenue. Such economic gains were offset by increases in their pension liabilities, which were caused in large part due to decreases in the market value of pension investments.
Over the past few years, investment market value shave swung dramatically. In 2022, this volatility negatively impacted most cities’ pension investments and their financial condition, which demonstrates the risk to taxpayers when cities offer defined pension benefits to their employees.
Of the 75 cities the report examined, only one received an A grade for fiscal health. The most common grade was D, followed by C and B.
The cities are also analyzed on their respective taxpayer burden, which means the amount of money every taxpayer would have to pay in order for the budget to be balanced.
Unsurprisingly, nine out of the ten cities with the largest taxpayer burden are run by Democrats. Leading the pack is New York City( -$61,800), followed by Chicago (-$42,900), Honolulu (-$24,200), Philadelphia (-$20,400), Portland (-$20,100), New Orleans (-$18,200), Miami (-$15,500), Milwaukee (-$15,300), Baltimore (-$14,100), and Pittsburgh (-$13,000).
It was not all bad news, however. Some cities were in taxpayer surplus, meaning they could afford to give every taxpayer a certain sum of money and still have a balanced budget. The five cities with the greatest surpluses were Washington, D.C. ($10,700), Irvine, California ($6,100), Plano, Texas ($5,100), Lincoln, Nebraska ($4,100), and Oklahoma City ($2,900).
The report concedes its limitations, including the fact that 2022 was still at the peak of the COVID-19 recovery process. However, it also notes that all of these cities received billions in federal relief funds, which should have helped the process of balancing out their budgets.
