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Austerity In America: 22 Signs That It Is Already Here And That It Is Going To Be Very Painful
Austerity In America: 22 Signs That It Is Already Here And That It Is Going To Be Very Painful
Courtesy of Michael Snyder at Economic Collapse
Over the past couple of years, most Americans have shown little concern as austerity measures were imposed on financially troubled nations across Europe. Even as austerity riots erupted in nations such as Greece and Spain, most Americans were still convinced that nothing like that could ever happen here. Well, guess what? Austerity has arrived in America. At this point, it is not a formal, mandated austerity like we have seen in Europe, but the results are just the same. Taxes are going up, services are being slashed dramatically, thousands of state and city employees are being laid off, and politicians seem to be endlessly talking about ways to make even deeper budget cuts. Unfortunately, even with the incredibly severe budget cuts that we have seen already, many state and local governments across the United States are still facing a sea of red ink as far as the eye can see.
Most Americans tend to think of "government debt" as only a problem of the federal government. But that is simply not accurate. The truth is that there are thousands of "government debt problems" from coast to coast. Today, state and local government debt has reached at an all-time high of 22 percent of U.S. GDP. It is a crisis of catastrophic proportions that is not going away any time soon.
A recent article in the New York Times did a good job of summarizing the financial pain that many state governments are feeling right now. Unfortunately, as bad as the budget shortfalls are for this year, they are projected to be even worse in 2012....
While state revenues — shrunken as a result of the recession — are finally starting to improve somewhat, federal stimulus money that had propped up state budgets is vanishing and costs are rising, all of which has left state leaders bracing for what is next. For now, states have budget gaps of $26 billion, by some estimates, and foresee shortfalls of at least $82 billion as they look to next year’s budgets.
So what is the solution? Well, for state and local politicians from coast to coast, the answer to these financial problems is to impose austerity measures. Of course they never, ever use the term "austerity measures", but that is exactly what they are.
The following are 22 signs that austerity has already arrived in America and that it is going to be very, very painful....
#1 The financial manager of the Detroit Public Schools, Robert Bobb, has submitted a proposal to close half of all the schools in the city. His plan envisions class sizes of up to 62 students in the remaining schools.
#2 Detroit Mayor Dave Bing wants to cut off 20 percent of the entire city from police and trash services in order to save money.
#3 Things are so tight in California that Governor Jerry Brown is requiring approximately 48,000 state workers to turn in their government-paid cell phones by June 1st.
#4 New York Governor Andrew Cuomo is proposing to completely eliminate 20 percent of state agencies.
#5 New York City Mayor Michael Bloomberg has closed 20 fire departments at night and is proposing layoffs in every single city agency.
#6 In the state of Illinois, lawmakers recently pushed through a 66 percent increase in the personal income tax rate.
#7 The town of Prichard, Alabama came up with a unique way to battle their budget woes recently. They simply stopped sending out pension checksto retired workers. Of course this is a violation of state law, but town officials insist that they just do not have the money.
#8 New Jersey Governor Chris Christie recently purposely skipped a scheduled 3.1 billion dollar payment to that state's pension system.
#9 The state of New Jersey is in such bad shape that they still are facing a $10 billion budget deficit for this year even after cutting a billion dollars from the education budget and laying off thousands of teachers.
#10 Due to a very serious budget shortfall, the city of Newark, New Jersey recently made very significant cuts to the police force. Subsequently, there has been a very substantial spike in the crime rate.
#11 The city of Camden, New Jersey is "the second most dangerous city in America", but because of a huge budget shortfall they recently felt forced to lay off half of the city police force.
#12 Philadelphia, Baltimore and Sacramento have all instituted "rolling brownouts" during which various city fire stations are shut down on a rotating basis.
#13 In Georgia, the county of Clayton recently eliminated its entire public bus system in order to save 8 million dollars.
#14 Oakland, California Police Chief Anthony Batts has announced that due to severe budget cuts there are a number of crimes that his department will simply not be able to respond to any longer. The crimes that the Oakland police will no longer be responding to include grand theft, burglary, car wrecks, identity theft and vandalism.
#15 In Connecticut, the governor is asking state legislators to approve the biggest tax increase that the state has seen in two decades.
#16 All across the United States, conditions at many state parks, recreation areas and historic sites are deplorable at best. Some states have backlogs of repair projects that are now over a billion dollars long. The following is a quote from a recent MSNBC article about these project backlogs....
More than a dozen states estimate that their backlogs are at least $100 million. Massachusetts and New York's are at least $1 billion. Hawaii officials called park conditions "deplorable" in a December report asking for $50 million per year for five years to tackle a $240 million backlog that covers parks, trails and harbors.
#17 The state of Arizona recently announced that it has decided to stop paying for many types of organ transplants for people enrolled in its Medicaid program.
#18 Not only that, but Arizona is do desperate for money that they have even sold off the state capitol building, the state supreme court building and the legislative chambers.
#19 All over the nation, asphalt roads are actually being ground up and are being replaced with gravel because it is cheaper to maintain. The state of South Dakota has transformed over 100 miles of asphalt road into gravel over the past year, and 38 out of the 83 counties in the state of Michigan have transformed at least some of their asphalt roads into gravel roads.
#20 The state of Illinois is such a financial disaster zone that it is hard to even describe. According to 60 Minutes, the state of Illinois is six months behind on their bill payments. 60 Minutes correspondent Steve Croft asked Illinois state Comptroller Dan Hynes how many people and organizations are waiting to be paid by the state, and this is how Hynes responded....
"It's fair to say that there are tens of thousands if not hundreds of thousands of people waiting to be paid by the state."
#21 The city of Chicago is in such dire straits financially that officials there are actually toying with the idea of setting up a city-owned casino as a way to raise cash.
#22 Michigan Governor Rick Snyder is desperately looking for ways to cut the budget and he says that "hundreds of jurisdictions" in his state could go bankrupt over the next few years.
But everything that you have just read is only the beginning. Budget shortfalls for our state and local governments are projected to be much worse in the years ahead.
So what is the answer? Well, our state and local governments are going to have to spend less money. That means that we are likely to see even more savage budget cutting.
In addition, our state and local politicians are going to feel intense pressure to find ways to "raise revenue". In fact, we are already starting to see this happen.
According to the National Association of State Budget Officers, over the past couple of years a total of 36 out of the 50 U.S. states have raised taxes or fees of some sort.
So hold on to your wallets, because the politicians are going to be coming after them.
We are entering a time of extreme financial stress in America. The federal government is broke. Most of our state and local governments are broke. Record numbers of Americans are going bankrupt. Record numbers of Americans are being kicked out of their homes. Record numbers of Americans are now living in poverty.
The debt-fueled prosperity of the last several decades came at a cost. We literally mortgaged the future. Now nothing will ever be the same again.
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How many do you plan on hiring?
What if 3 people mug you?
Speaking of which, since you don't believe in property rights enforced by the state (i.e. the police) can you tell me:
(1) How much you earn?
(2) How many security personnel you employ?
(3) Your address?
See Rothbard's Society Without A State
In this talk, he distinguishes state enforcement from social arbitration of rights.
Also, see Aesop's The Frogs Who Desired A King
No. Government fails when it only serves to serve itself. That is what we have here and the can is getting too big to keep kicking down the road.
We have a Constitution, and we haven't been following it. Bankrupt town, counties, states, and a federal government is the result.
Consider:
1. The Constitution is a piece of paper, whose intrinsic value is zip.
2. Governments everywhere and always serve only themselves.
3. Justice is the interests of the stronger.
4. There are exceptions.
5. False reasoning converts the exception into the rule.
6. The rule is 1-3 above.
In the case of the US, probably.
The US has been nothing but a big Ponzi.
In the nineteen century, the Ponzi was always more Indian land to rob. Collapsed to give the GD.
This said, this Ponzi building was against the US proclaimed rules and rendered judgement.
Andrew Jackson called for judges to come and apply the law if they wanted to.
So, yep, the US ponzi was started because of a failure in regulation.
i say over regulation that was not enforced... but yes I agree.
No.. Ponzi in housing was caused by very BAD regulation.
The ponzi in homes was balloned by baby bush... you need the video?
you wanna see the act daddy bush put together and baby bush pushed thru?
do you?
google is free, learn something.
Bush wanted to privatize Fan/Fred but was prevented by the libs in Congress. That is a fact, JW.
We've reached the End Game for the Chicago School ideology. And like any ideology that puts itself above the welfare of the populace, its going to be fugly.
And not one broke municipality even considers bondholder haircuts.
Yes. Amazing, isn't it.
well no one wants to start the fall of the dominoes of derivatives now do they? Look how fuckin' smart our TBTF bankers are...they're making money hand over fist while we going down, and they have everyone running scared. I say get out the pitch forks and chase them down the streets and let them know who the real boss is and what real fear is! Fuck those cocksuckers (I want to be clear that there are good banks and bankers out there....just not at BAC, JPM, CITI, GS or WF)
Underrated post of the year.
Oakland, California Police Chief Anthony Batts has announced that due to severe budget cuts there are a number of crimes that his department will simply not be able to respond to any longer. The crimes that the Oakland police will no longer be responding to include grand theft, burglary, car wrecks, identity theft and vandalism.
Not responding to identity theft, sure, I could see that, but burglary, theft and car wrecks? What the fuck? So there will be a big spike in those crime rates, and a lot of people deciding to just take the law into their own hands. It's a good thing they didn't de-list homicide, because there's gonna be a lot of those.
An enterprising bounty hunter / thief taker could probably get some business out of this. If the police won't do it, somebody has to. An ounce or two of gold and I'll find your man.
"Oakland police will no longer be responding to include grand theft, burglary, car wrecks, identity theft and vandalism."
I thought this must be a joke when I first read it.
The US of A is entering third world status...if you don't live in a gated community or condo with private security you better put a wall up around your property...make sure to line the top with broken glass and get a few pitbulls, dobies and rotweilers to roam your yard. Have guns close by, and even better, pay an armed guard for protection.
>> you better put a wall up around your property..
I can tell you from experience, that won't do any good. I just escaped from a similar situation. We were broken into probably 10 times in the five years I was there. There were an untold number of petty larcenies, probably 50. The even stole plants out of the ground. I had all the windows screwed permently shut. I had bars and hardware cloth on my garage windows, metal exterior security doors. I removed all gates to the fences as that was an entry point. I reinforced the entire perimeter fence. There were two locks on every gate or door and the garage doors were padlocked from the inside. Still, the bastards would find a way in. A couple of times a month someone would try to barge into the front door, hoping we had left it unlocked. In our last 30 days before closing on the property, we were broken into one more time (the cops finally caught one of them, although they tried their damndist to arrive too late), or car window was smasted out with a brick to ransack the interior, and a guy pulled a knife on me while I was out walking.
This was all in a neighborhood most eveyone thought was a decent neighborhood. An attorney bought the place to remodel into her office. I can't belive my luck in getting it sold.
If things continue to deteriorate, as I expect them to, living in the city, other than wealthy enclaves, will be hellish. I moved so far out into the sticks I have to walk a third of a mile to get to my mailbox. I'm sure this location has it's vulnerabilites if things continue to deteriorate, but nothing like the hell of an inner city.
Wow! Where were you living?
Look on the bright side, guys. You will be able to steal power, cable, and license plates with impunity. Sex offenders won't get run out of down anymore, and considering how easy it is to get on those lists, this is (mostly) a good thing. One thing conspicous by it's absence: having small amounts of drugs. Probably because drugs help people realize what a load of crap the system is, and because they can easily be sold from the evidence locker.
When things get really bad, cops will become the dominant local gangs and they will pay themselves by confiscating "contraband" like gold, unregulated produce, out-of-season elk, whatever. Arm yourselves.
Might have a problem with insurance claims.
Honestly, I was robbed.
Did I report the incident to the police?
Uh yeah, they said to f*ck off, they don't investigate theft.
#14 Oakland, California...police will no longer be responding to...grand theft, burglary, car wrecks, identity theft and vandalism.
Great legacy, Jerry. Perhaps if he'd just take all the cell phones away he could restore proper law enforcement activities. What a freakin joke!
Not to let fact get in the way of a good rant, but Jerry runs the state, Okland is a city, Jean Quan is the Mayor.
I don't know why people are surprised. What did people think was going to happen when they wanted massive layoffs in their local governments?
I see a lot of pencil pushers still pushing their pencils. Why cut services like FD and police? Somehow, administration always escapes the brunt of the cuts. Bureaucrats are untouchable.
in theroy, the demand for security should go up but, for some unknown reason, it never does.
http://covert2.wordpress.com
A TAXCUT TO SOMEWHERE NEAR ZERO.
That actually what people always think. Fire everybody so they need to pay less taxes, let all the sick just rot so they need to pay less taxes...
Guess what...
All is cut or is going to get cut...
and taxes will rise.
NEXT UP: Put the unemployed into camps.
I kid you not, the average Joe and Jane only care about themselves.
Unless something happens to them, then the whole planet needs to help them out.
Copy that on the camps.
No savings, no un-employment (ran -out),
no doubt the prisons er... un-employment camps will be full, full, full.
In Michigan, two years ago, there was an event for review of a book on the CCC camps of the 30's. Special guests included one or two surviving CCC workers who discussed their memories. The buildings had rows of bunks, regular hours for getting up and lights out, meals and work schedules. Both individuals had positive impressions of the effect of the experience on their lives. (It prepared them, no doubt, for WWII. Income, except for basic experiences was sent home to familys.
Put the unemployed into camps? I'll have to think about that one.Lot's of unintended financial consequences to be sure.
What we're headed for and to a certain extent are already experiencing is legalized extortion. The cities, counties, and states are so desperate for revenue that basically they will stop at nothing. Not sure where this information may reside but based on a very informal survey, I can assure you that the volume of traffic tickets and the average fee per ticket have increased in California over the past five years. Need revenue, no problem just increase the traffic ticket quota for the CHP officers to drive revenue or expand the use of traffic photo systems and increase the fees. No joke, a friend of my received a photo ticket for $476 for not coming to a complete stop when making a right turn on a red light. Add in his time, inevitable increase in insurance, and traffic school and this one event will cost him more than a grand.
Increased fees, costs, charges, or whatever you want to call it are happening to every consumer, every day. Just look at your utility bills, bank fees, you name it. We're being extorted across the board and what's scary is this looks to be only the start. It's hard to believe how big of a mess the Muni situation really is.
...noticed this too here in norcal...the CHP has taken to posting radar gun cops on freeway overpasses, with ticket writers down the road...lived here for 40 years and this is the new reality.
At the same time we get lowered police protection against violent crime, our idiotic state government has tried to limit the ability of law abiding citizens to buy ammo...
discovered this blog yesterday. good times. good stuff.
it's about time. we waited too long.
http://covert2.wordpress.com
AND DO YOU ALREADY FEEL LIKE SINGING CUMBAJAH ALREADY? :)
The Geniuses in the US Congress were working hard 100 years ago too:
The U.S. Congress once appropriated money to paint the Statue of Liberty. In 1906, the Congress of the United States voted to appropriate $62,000 to paint the statue. The original copper had started developing its beautiful blue-green patina, and some politicians were upset with the change. Public outcry kept the statue from being painted.
The copper patina preserved the statue. Copper develops its patina as a result of exposure to air. Once the pristine copper has turned blue-green ("patinated") the patina serves to reduce further oxidation. Thus the patina serves to protect the copper from further deterioration. Studies have revealed that only the top 5% of the skin has oxidized in the first 100 years, with most of that occurring in the first 10-25 years through a process called early oxidation.
It is good to see that the people of yesteryear learned about oxidation and oxide coatings as a protective method. Knowledge available to junior high students today was just being discovered by the politicions of that era.
Perhaps this generation will learn the need for protection through education from the easy money politicians.
DID YOU JUST CUT THE LINE?!
All over the nation, asphalt roads are actually being ground up and are being replaced with gravel because it is cheaper to maintain...
You know your empire is in trouble when the infrastructure starts going downhill.