When the facts change, I change my mind. What do you do? -- John Maynard Keynes

Friday, August 2, 2013

Businesses Should Fear States' Big Pension Debts

Better think twice before locating in Illinois, etc.--

RealClearMarkets - Businesses Should Fear States' Big Pension Debts: "Smart businesses are starting to figure out that their decisions on where to expand, relocate or otherwise invest their resources have to take into account the staggering debts that some states and cities have accumulated, especially since the retirement debt burden is not dispersed equally across the country. Some states are in far worse shape than others. As the Chicago Tribune, writing about Illinois' formidable pension debt, astutely observed last year, "Companies don't want to buy shares in a phenomenal tax burden that will unfold over the decades." Businesses in Illinois already know what this means. In January of 2011 the state, facing incredible pressure to pay its bills, instituted $7 billion in new corporate and income taxes. But the legislature did nothing to reform spending. Raising taxes, it seems, is easier in Illinois than reforming employee pensions. Absent reform, about half of the Illinois tax increase simply went into the state's pension system to keep it afloat. Meanwhile, state debt continues to mount. . . ."

The Big Picture

Financial Crisis - The Telegraph

JohnTheCrowd.com | The Sailing Website

Craig Newmark - craigconnects