Hawaii taxpayers are suffering a crippling tax load due to the state debts, particularly the unfunded retiree health care and unfunded pension costs.
That is the assessment from Bob Williams, president of State Budget Solutions a non-partisan advocate for state budget reform, whose organization released a new study this week showing state government debt amounts to $13,425 for every American and $37,486 for every private sector worker in this country.
Hawaii is ranked in fourth in terms of heaviest debt loads per taxpayer, with Alaska, New Jersey, Connecticut and Illinois also in the top 5.
“Voters deserve to know how much debt their elected officials are saddling them with before they go to voting booth. $13,425 per person is an unacceptable debt and immediate fiscal reform is desperately needed,” Williams said.
The whopper: Hawaii taxpayers carry a burden more than twice the national average at $29,062 each, compared with the US average of $13,425 per taxpayer.
That means, to pay off the state debts, each Hawaii taxpayer would have to pay $29,062.
When looking at private sector workers alone, Hawaii’s private employers and employees have a much more substantial burden, more than twice the national average, and the highest in the nation.
Hawaii private sector workers owe $83,815 each compared with the US average of $37,486.
“Hawaii’s state employee salaries and benefits levels are unsustainable and if taxes are continued to be raised more and more businesses will either leave the state or fail financially,” Williams said.
Priave sector workers are at increased risk as they are the ultimate tax base for reducing state debt, Williams said.
Bureau of Labor Statistics shows that after Hawaii, Alaska, New Jersey, Connecticut, and New Mexico have the highest burden on private sector workers.
Nebraska again has the lowest total, with $9,829 in debt for each private sector employee. Indiana, Tennessee, North Dakota, and South Dakota follow.
When calculating state debt as a percentage of private sector GSP, State Budget Solutions said Hawaii’s debt stands at 79.21 percent of its entire private sector GSP, the highest percentage of the 50 states.
New Jersey’s debt is 59.69 percent of private sector GSP and Ohio, New Mexico, and Alaska make up the remaining top five.
Nebraska, Tennessee, Indiana, North Dakota, and Virginia have the lowest debts as a percentage of private GSP, the State Budget Solutions report said.
This report is an extension of the organization’s third annual State Debt Report, released in August.
The report shows in total, state governments collectively have a whopping $4.6 trillion in debt.
The analysis of debt per person looks at state debt per capita, per private sector employee, and the percentage of private sector gross state product (GSP).
According to Williams, in each of the three categories, Hawaii, New Jersey, and Alaska are among states with the five largest debt figures.
Nebraska has the lowest total debt per capita at just $4,249 for each resident. Tennessee, Indiana, Florida, and Idaho round out the lowest five debt levels per capita.
“Americans are sadly desensitized to the trillions of dollars in debt our states are facing. This report brings the debt closer to home by demonstrating that a newborn arrives already more than $13,000 in debt and that a family of four owes their state government $53,700,” said Williams. “It is the individuals and families who will ultimately bear this horrific financial burden if state governments do not get their budgets under control.”
To read the full study click here.
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Lucky we have the visitor industry. If we didn't, and we were experiencing economic hardship comparable to some of the states on the mainland, this issue would've come to the forefront a lot sooner. In the financial meltdown of 2007, the economy lost about $40 trillion. Can we reasonably expect to have turned this situation around in four short years? Where will the money come from to amortize our debt? The business community should be the first to come up with some solutions. The politicians are not going to do it because they might be voted out of office in the next election.
This has to come down on us in a crushing fashion . There is no way out, but we keep "dancing on top of the vulcano.."
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