By Rep. Raul Torres
The two issues are Texas has a debt and an education crisis. This week I will be discussing the debt crisis and later I will discuss the education crisis.
Everybody knows that our federal government have a serious $15.5 trillion debt problem, but most people do not know that our states have a similar problem. According to a new report issued by Reuter’s America’s 50 state governments owe $4.19 trillion which includes outstanding bonds, unfunded pension commitments and budget gaps.
The top five states with the highest state debt are: California is at $617.6 billion, and is more than twice the total of No. 2, New York, with $300.1 billion owed. In third place is Texas, with $287 billion followed by New Jersey, with $282.4 billion, and Illinois, with $271.1 billion.
“Our states are in trouble and no amount of budget gimmicks, political posturing or hiding bills will fix the massive debt that they face,” said Bob Williams, president of State Budget Solutions. “Drastic reforms, innovations and political courage are needed to put our states back on the road to fiscal survival.”
However, the debt crisis doesn’t’ end here. We also have a serious debt crisis in the area of local government debt. According to Peggy Venable, Executive Director of Americans for Prosperity local debt is a national crisis. Consider these facts:
- Local government debt is now $1.785 trillion nationwide.
- Texas is second in the country in local debt, behind only California and now totals $322,331,957,000 when interest is added.
- Texas local government debt is larger than all local revenue, which is at $1.169 trillion. That’s not counting the interest payments.
- Local government spending grew at a rate of two times the increase in population plus inflation from 1992-2008.
- Local debt has grown 72% in Texas in the past 10 years.
Currently combined state and local debt equals to $609 billion in Texas. This translates into an additional tax burden of $24,000 for every person. When you add the federal debt per person the total debt per person is $75,000 and this amount continues to grow daily.
Bottom line is that we are leaving our children and grandchildren a legacy of debt. That is not the legacy most of us want to leave future generations. If you would like to read more about this very important issue visit: Local Governments Racking up Debt.
In conclusion, our state’s economic future is at stake and it is our children and grandchildren who will be burden with this massive debt and in most cases without having the benefit of the project those dollars were funding.
That is why I will continue to talk about this problem and I plan to submit legislation to address this major problem so we can put Texas back on a strong financial foundation.
Raul Torres , State Representative