California Orders Spending Freeze on $68 Billion Budget Deficit

[pasayten]

Second - think of 10 people sitting around a table. Each person owes $100 to the person on their left. What is is ‘total debt’ at the table? It is $1000.
If someone comes along and gives $100 to one of those 10….then they pass it left…and the $100 bill goes around the table. Everyone is paid off.

That only works if people are fair and play by the rules... They don't...

[just-jim]

Yes, the debt has to be repaid at some point. But not with 2023 dollars. Who is to say that when your share of that debt comes due your bill might be the same as what you paid for a cup of mini mart coffee that morning?

One of my Economics professors explained public debt this way:

First- most of this debt is money we owe each other (that’s in spite of the prevailing right-wing clamor that ‘China owns us’). By far, the biggest owner of the debt are American citizens. We owe each other this money.

Second - think of 10 people sitting around a table. Each person owes $100 to the person on their left. What is is ‘total debt’ at the table? It is $1000.
If someone comes along and gives $100 to one of those 10….then they pass it left…and the $100 bill goes around the table. Everyone is paid off.

Yeah…simplistic. But government debt isn’t the same as household debt.
.

[Fun CH]

"As of August 31, 2022 Texas had a total of $64.40 billion in state debt outstanding, including both general obligation and revenue debt.
State of Texas Debt "

Population in 2023 is 30 million.

$2,133 per person

MPD in the Methow School district at max debt limit could have been approximately $10,000 per person

[mister_coffee]

Yeah, but the United States is very unlike a household, a business, or a state. The United States has the authority to print money to pay off its debt.

I'm not saying that is a good idea or even necessary, but the credit risk of United States government debt is by definition zero. Some economists (that I kind of agree with when I can understand what they are saying) would say that makes T-bills a lot more like a currency than an actual debt instrument. So if you subscribe to that argument then we are just printing more money.

Yes, the debt has to be repaid at some point. But not with 2023 dollars. Who is to say that when your share of that debt comes due your bill might be the same as what you paid for a cup of mini mart coffee that morning?

[pasayten]

Wow... These guys ever go to math and economics classes???
$68,000,000,000 / 39,000,000 population = $1,743 for each and every person

(Bloomberg) -- California Governor Gavin Newsom ordered a spending freeze as the state’s projected budget deficit ballooned to $68 billion for the next fiscal year — almost five times higher than the initial forecast.

State agencies should cut spending on everything from office supplies to computer equipment and halt all non-essential travel, Newsom’s Department of Finance said in a letter posted to its website late Tuesday. The freeze also restricts purchases of new vehicles and other equipment.

Government entities “must take immediate action to reduce expenditures and identify all operational savings achieved,” budget director Joe Stephenshaw said in the letter.

The deficit for the fiscal year that begins in July is now projected to be double the size of the current year’s shortfall, forcing the government to consider cuts to key services, including schools, and to weigh tapping budget reserves. The deficit is tied to the waning fortunes of California’s wealthiest taxpayers, who pay the bulk of personal income taxes, the state’s largest revenue source.
The Newsom administration originally projected a $14 billion deficit in the upcoming fiscal year. In January, Newsom will present a detailed budget proposal.

The last time California ordered state agencies to freeze spending was in spring 2020, when the state was concerned that pandemic-related restrictions would reduce tax revenues.

Of course, for the entire U.S., the U.S. government has run a deficit averaging nearly $1 trillion every year since 2001...
$1,000,000,000,000 / 339,996,563 people = $2,941 for each and every person

Then, our national debt...
US Published National Debt
$33,890,865,462,948

The Truth
- assets and liabilities reported in the Financial Report of the U.S. Government
- unfunded Social Security and Medicare promises, based on assumptions
$162,909,846,575,000

Each Taxpayer's Share: $970,000
https://www.truthinaccounting.org/about ... ional_debt