Gov. Daniels often brags about how fiscally sound Indiana is. I’ve often taken him to task for balancing the budget on the backs of local government, but I sort of took it for granted that, otherwise, he was correct that the budget had been balanced.
But, I probably shouldn’t take that at face value in light of what is happening to the state’s unemployment insurance fund. Indiana has borrowed $1.1 billion and expects to borrow another half billion before the end of the year.
Indiana Department of Workforce Development officials said the state now has borrowed $1.1 billion to pay unemployment benefits — a figure that is expected to reach $1.7 billion by the end of this year — and could add another $1 billion of debt in 2010.
Lawmakers initially hoped their plan would allow the state to stop borrowing money by 2012. Now, with long-term employment projections more grim, agency officials said it probably will take until 2015.
By no means is the Gov. Daniels’ fault alone. The unemployment insurance fund has been an obvious problem for a long time, and legislators kicked the can down the road year after year. They finally addressed it to a certain extent this year, but obviously it’s still a big hole in the state budget. But, the governor hasn’t shown much in the way of leadership on the issue and with the state borrowing a billion dollars, I’m not sure he can claim a balanced budget with any accuracy. It’s not really a defense that he would have preferred not to pay out unemployment benefits.
Never believe politicians when they talk about “balanced budgets”. Much like the mythical Clinton-Republican Congress “balanced budgets” and “surpluses” of the 90s. It takes about 30 seconds of research to verify that the national debt increased every single year in the 90s (admittedly some increases were small, but they were all increases).
When the national debt actually goes DOWN, then come talk to me about surpluses. Otherwise you’re just playing games with numbers.
If mitch claims it is an honestly balanced budget, I believe him. After all, he was proven right on his projections of the cost of the iraq war. And bosma said the same things, and he would not lie since he speaks to god every day. And privatization of dcs is working very well.
Indiana Unemployment Situation in Heat Map form:
here is a map of Indiana Unemployment in July 2009 (BLS data)
http://www.localetrends.com/st/in_indiana_unemployment.php?MAP_TYPE=curr_ue
versus Indiana Unemployment Levels 1 year ago
http://www.localetrends.com/st/in_indiana_unemployment.php?MAP_TYPE=m12_ue
Those heat maps are pretty cool. The lower unemployment in Indiana almost looks like a flood plain running along I-65.
Chris, your’re dead on about the debt going down. I hear everyone talking about a balanced budget or how much of a deficit we have. I rarely hear anyone actually talking about getting us out of debt.
However, I think as more people get out of personal debt, we’ll start seeing more people get elected with the same goal for government. I only hope that the reduction in personal debt isn’t a short-term trend, otherwise people will never care about electing people that want to get the country out of debt!
Source on personal debt: http://www.tampabay.com/news/business/personalfinance/consumers-debt-reduction-could-threaten-economic-recovery/1034644
PS, I strongly disagree with the article’s conclusion, that less consumer debt is a bad thing.