When I lived in California, people thought of Connecticut as either one big suburb of New York, or “somewhere by Maine”. These kinds of perceptions contribute to small-state syndrome, and have created a bit of a chip on our shoulders. We are not nearly as inwardly focused as some states (I’m looking at you “Republic” of Texas), but it seems as though we have this need to stand out from the jumble of states in the upper-right quadrant of the map.
When I read Mary William Wash’s article in today’s New York Times, I was happy to see Connecticut was number one in something besides women’s basketball. We are now number one in, drum roll please, highest total indebtedness per capita!
Not only did we win, but it wasn’t even close. Connecticut’s debt of $9,366 per man, woman, and child, is 17% greater than that of our closest competitor (Hawaii). Our per capita debt towers almost 40% higher than that of #5 Illinois, a state that Moody’s has rated A1 with a negative outlook, the worst state bond rating in the country. That victory feels especially good since our defeat to the Land of Lincoln for most corrupt former governor is still fresh in the minds of many. Perennial poster child for financial mismanagement, California, doesn’t even crack the top 10.
Mary’s article reminds us that under the preposterously outmoded rules of Government Accounting Standards Board (GASB) – GAAP’s less popular step-sister – “states do not show their pension obligations – funded or not – on their audited financial statements.” Perhaps Moody’s recent change to begin including unfunded pension obligations into state debt burdens will spur some new transparency into state and municipal finances. If we let the sunshine in, perhaps it will give some of our less brave politicians the cover they need to enact much needed structural changes.
Until then, We’re number one! In your face New Jersey!