Isn't California entertaining to watch?

[Torie]

The people of California made this bed by screwing with their property taxes and increasing the govt spending without coming up with ways to pay for them, why should the rest of the country pay for that if you guys refuse?

Because we have 50 plus electoral votes and Congresscritters?  

[Torie]

The idiocy of Proposition 13 coming to fruit is a beautiful sight.

Prop 13 was ludicrous, even though over time it has hugely benefited me financially, but given the high real estate values in Cali (and that is still the case relatively speaking), it is not the lack of property tax revenues which has led to insolvency. Indeed, I think Cali is in the top 5 in per capita taxes raised among the states.  We have a very high income tax, where you hit the max rate of 9.6% at about 50K or so (10.6% actually if you earn over a million in taxable income in a year), high sales taxes, along with high property values, which even with Prop 13 generate handsome revenue. Prop 13 was ludicrous because folks owning homes or commercial property of similar value can pay tax amounts that can vary by as much as a factor of 5.  If I sold one of the properties I bought in 1979, the new owner would indeed pay property taxes about 5 times as high as I am paying. That is at once unjust and well, simply insane really.

[Torie]

We did make this.

Torie, Prop 13 created more problems than just the ability to raise money via property taxes.  It also made it impossible to pass a common-sense budget and forced a cycle of constant housing development in order to get property sold with the latest tax rates, underfunded schools in areas like cities that cannot support constant development, etc.

Other props, mandating that such and such percent go to this or that are also screwing the state over. 

Interesting comment, which I would like to pursue further with you Lunar. But at the moment, I'm wasted, and it's time to decamp from the puter.

[Torie]

Is there a source that lists deficit by state?

http://money.cnn.com/news/storysupplement/economy/gapmap/

Bear in mind that this site just shows the state deficits. When including private debt in the total of projected expenditures, California drops to something like fifteenth place - with Louisiana, Mississippi, and Alabama ranked in the top three positions, respectively. So the State deficit actually doesn't tell you everything about the financial solvency of the states; privately-held debt can swing these numbers fairly drastically. And that's what we need to focus on solving first.

What is the significance of "private debt" whatever that means in this context, in terms of state governmental solvency?  I need more bridge work here to understand your point.  Thanks.

[Torie]

You have a point Einzige. If folks are broke, it may be hard to tax them some more. But I suppose one could raise taxes on their income, and they could just go BK, and screw private creditors. Anyway thanks.

By the way Louisiana gets a ton of revenue from oil, so that is the real source of its revenue. Without oil, and its attendant industries, Louisiana would be in terrible shape indeed.