10 States With Enormous Debt Problems: Report

Aug 28 (Reuters) - America's 50 state governments owe $4.19 trillion, including outstanding bonds, unfunded pension commitments and budget gaps, according to a new report.

At $617.6 billion, California had by far the biggest total debt, more than twice the total of No. 2, New York, with $300.1 billion owed, according to State Budget Solutions, a research and non-partisan advocacy group.

Texas, with $287 billion owed, New Jersey, with $282.4 billion, and Illinois, with $271.1 billion, ranked next among states with the biggest total debt, according to State Budget Solutions. Vermont had the smallest debt load at $5.85 billion.

The annual study said state governments had benefited in the last year from smaller budget gaps and reductions in loans taken from the federal government during the worst of the Great Recession to pay unemployment claims.

Those trends helped reduce total debt, which includes medical insurance due retired government workers, from last year's $4.24 trillion of total debts owed by the 50 states, according to State Budget Solutions.

"Our states are in trouble and no amount of budget gimmicks, political posturing or hiding bills will fix the massive debt that they face," said Bob Williams, president of State Budget Solutions. "Drastic reforms, innovations and political courage are needed to put our states back on the road to fiscal survival."

Check out the states with the worst debt problems below:

Loading Slideshow

• 10. Massachusetts

  Total State Debt (in thousands): $102,258,050

• 9. Michigan

  Total State Debt (in thousands): $124,496,677

• 8. Florida

  Total State Debt (in thousands): $134,900,802

• 7. Pennsylvania

  Total State Debt (in thousands): $142,513,672

• 6. Ohio

  Total State Debt (in thousands): $239,540,635

• 5. Illinois

  Total State Debt (in thousands): $271,111,148

• 4. New Jersey

  Total State Debt (in thousands): $282,393,641

• 3. Texas

  Total State Debt (in thousands): $286,999,196

• 2. New York

  Total State Debt (in thousands): $300,066,114

• 1. California

  Total State Debt (in thousands): $617,620,709

Comments

[Bklein153]

12:18 PM on 08/31/2012

I luv how they include TX with NJ and IL! TX has 25.6 MILLION residents, while IL only has 12.8 million (half) and NJ only has 8.8 million (a third). SO on a PER CAPITA basis IL debt problem is TWICE as large as TX and NJ's is a whopping THREE TIMES the problem! Oh and TX has a faster growing economy, growing population (it has gained Congressional seats while the other two lost seats) and a stronger business climate. These are apples and oranges!

[DontTreadOnMe89]

10:49 AM on 08/30/2012

This is interesting.

Blue states: Massachusetts, Michigan, Florida, Pennsylvania, Ohio, Illinois, New Jersey, New York, California

Red states: Texas

http://www.electoral-vote.com/evp2010/Info/red-blue.html

I can tell you from personal experience, Texas is in debt, but we are also doing well. With major companies like Dell (possibly you computer), Texas Instruments (most likely your graphing calculator), a couple Apple factories, a couple of IBM facility's, and even the new F1 track, Circuit of the Americas, it's alright here. We are 1 of 5 states that does not have State Income Tax, hence the reason why Californians are flocking here in droves.

[Wisdom and Victory]

01:13 PM on 08/30/2012

Your Blue/Red state theory applies only to presidential elections. Which has nothing to do with how states are run--that job belongs to the governor.

On the state level:

Michigan--Rick Snyder-----------Republican
Florida--Rick Scott-----------------Republican
Pennsylvania--Tom Corbett-----Republican
Ohio--John Kasich-----------------Republican
New Jersey--Chris Christie-----Republican

California's problems can all be traced back to the Enron (based in Houston, Texas!) scandal.

[DontTreadOnMe89]

02:43 PM on 08/30/2012

It's safe to say, 9 out of 10 states voted Barry in, and half of them are run by republicans.

[MANOFCOMMONSENSE]

12:28 AM on 08/31/2012

Michigan had 3 terms with Republicans in charge when Engler was Gov.. Then 2 terms of Democrat...Which she did nothing to increase the debt.. Republicans were in charge of the legislative branch during her term.. And now Republican Snyder is in office...With most of the same Republican majority they enjoyed for decades

[BR1234]

09:13 AM on 08/30/2012

And the 800 pound gorilla is OBAMA with 16 TRILLION and happily getting larger by the second as he promises ever more while pandering for votes.

[thekid360]

11:27 AM on 08/30/2012

You do know that 10,000 baby boomers are retiring every day and are now collecting social security and medicare. That does cost money and these people are over 55, they are real they have to be dealt with now. Those numbers will add weight to that 800 pound gorilla and zero's to that $16 trillion. Anyhow Obama can't spend any money the cause GOP has spending on lock down so they tell you ,and you went for it

[BR1234]

11:53 AM on 08/30/2012

LOL You are completely oblivious to reality... It must have been the Mayor of Cleveland asking to have the National Debt Limit raised....not Obama.

[Bklein153]

12:23 PM on 08/31/2012

10,000 baby boomer per day did not take the debt from 8 trillion to 16 trillion in 3 1/2 years. That was Bush and Obama. Like the president you fail to take responsibility - how typical!

[Pinmason]

11:51 AM on 08/30/2012

You can't blame either candidate for the 800 pound gorilla or the 16 trillion...That goes back to the Zoo Keepers...people like Wall Street and the Banks and the Koch Brothers who set the prices.
When Jobs are shipped overseas or outsourced, tax revenue goes with it...when you keep money in off shore accounts to avoid taxes, that debt rises. When you subsidize the rich with tax loopholes and subsidies, that debt rises.
When you propose a jobs bill that taxes American products manufactured overseas and proposes a twenty five percent tax rate down from thirty five percent for business in the hopes of creating jobs while your counterparts in the Republican Party propose a "jobs bill that holds the federal reserve bank and it's board of govenors exempt from any charges stemming from the Libor Scandal and takes the teeth out the SEC to stop investigations into the wrong doings of Banks like Chase that lose nine billion because they gambled away that nine billion on the stock market using customers commercial accounts to back the bet and you blame the trillions lost in property values due to failed republican legislation that allowed banking fraud to sweep this country no matter who sat in the Oval Office, I think you need to point that Gorilla in the right direction...you might start with Bank of America.

[BR1234]

11:59 AM on 08/30/2012

There is one person to blame... and as it was said years ago, The "Buck Stops Here"...., that one person is B Huessien Obama

[Bklein153]

12:25 PM on 08/31/2012

How does Koch 'set the prices?" Is there some secret room they met at and decide what apples, or oil or bread cost? You need to understand that is not reality but a place over the rainbow called OZ!

[bullthull]

08:06 AM on 08/30/2012

But debt does not matter according to Washington, just borrow more.
PS Michigan is finally recognizing and accounting for the debt.
Snyder and Christie inherited bigger messes than Obama - states cannot borrow the same way the federal government can.

[mostimpressive]

07:26 AM on 08/30/2012

Something to add to the résumé, Mr. Krispie.

[need2know]

04:54 AM on 08/30/2012

Wow more republican controlled ones than non republican. Why is Texas on there, i thought they had great budgeting skills and didn't Christie say he balanced his budget?

[bullthull]

08:07 AM on 08/30/2012

Snyder and Christie inherited bigger messes than Obama, they cant print money in state capitals.

[Dean Dake]

09:48 AM on 08/30/2012

lame comparison

[DontTreadOnMe89]

10:50 AM on 08/30/2012

Did you look to see who runs these states? 9 out of 10 are blue states.

[need2know]

01:10 AM on 09/04/2012

wrong 4 out of ten are red states. re-do your counting 

[Global32]

02:19 AM on 08/30/2012

I was expecting Montana to be among the top three states with higher debt because of the huge population of 15 people.

[Presidium Patriot]

12:33 AM on 08/30/2012

From 1979 to now, worker productivity has sky rocketed 80%, but our wages have only gone up 10%. During this same period, 56% of the wealth our productivity created went to the top 1% -- with only 16% going to the lowest 90% of wage earners.

If American workers wages kept pace with our productivity, the state economies -- as well as the national -- would all benefit from our spending power.

The rich hide money away in foreign bank accounts, while the middle class spends it and creates jobs.

Unfortunately, we have been systematically destroying unions, workers groups and collective bargaining while at the same time cutting taxes for the wealthy - and giving tax payer funded subsidies to oil and sugar industries.

Look at the European countries that are attempting to resolve economic disaster with 'austerity' measures... how is the 'no spending' recovery working for them?

[Appleblossom]

02:12 AM on 08/30/2012

Time to raise income taxes on the 1% to 70%.

If you do that every wage worker in the country would get a raise.

[MarquisFacade]

03:05 AM on 08/30/2012

or the 1% stop producing because it's no longer in their interest to do so, and all those employees no longer have jobs. Your choice, comrade.

[Rigger2175]

01:48 PM on 08/30/2012

let's look at your statement. so if i earn 100 million a year, and have to pay in 30 million in taxes, and you make 30k and pay in 3000. How does my taxes going to 70 million, decrease your tax rate or increase your disposable income? It doesn't in any stretch of the imagination, in fact I will probably by less, which in turn means less people have jobs in the middle class to produce the goods or services. I am not seeing any logic in your argument. Personally i want a flat tax rate, no deductions and .5% national sales tax, a reduction in overall govt spending by 20% by 2016.

[MarquisFacade]

03:03 AM on 08/30/2012

They "hide" it? Because it really belongs to you, or the people, right? The commissar approves of your message, comrade.

[Icantbelieveher]

06:47 AM on 08/30/2012

Asking for a decent living wage makes us communists?  How did this country survive when the top tax rate was 90%!  I'll tell you how -- there were more prosperous people, rather than just 1% of the population holding more wealth than the bottom 150 million combined!

[Presidium Patriot]

02:42 PM on 08/30/2012

It is common for the rich -- like Romney for example -- to use foreign bank accounts to avoid paying taxes. So yes -- 'hiding' or 'tax shelter' can be used for this behavior.

[YeOldeSnark]

11:33 PM on 08/29/2012

Note the states with the highest debt loads also produce most of the jobs, especially Texas California ,and New York. Let this be a lesson to those Republicans who would tell you how sacred a balanced budget is or the great value of NO DEBT can be.

Look at Vermont for example which has one of the highest rates for losing young people looking for employment elsewhere of any state in the nation. Many of them going to Texas, Florida, Tennessee and California. Vermont has virtually NO DEBT.

A prescription for continuing depression and continuing economic under performance if there ever was one..

[Alice Merritt Clark]

04:58 AM on 08/30/2012

Much as I love Vermont and would love to return, YeOldeSnark is right. I don't know if this is a product of the left or the right, but the small debt load is deceiving. Taxes are very high, there is very little job opportunity, wages are low, and there is no growth. Because of this, the revenue that the state can generate from income tax on good jobs and a robust economy is limited, so expenditures are made reluctantly. Everything is very austere and pared down, which is not always good, nor is it necessarily a bad thing. I have always hoped that Vermont could attract clean sustainable jobs, perhaps customer service and call center jobs brought back from offshore now that technology allows interesting, transportation free possibilities, but alas, the high speed internet infrastructure is not there. The well educated, hard working population suffers as a result. It is laudable to prudently control spending before it becomes insurmountable debt, but I agree, zero debt is not the holy grail in state government.

[Rigger2175]

01:54 PM on 08/30/2012

what are your thoughts on why ND is so prosperous? Unemployment under 5%, wages some of the fastest growing in all sectors and sections of the state (not just the oil patch) Budget surplus, should i go on

[YeOldeSnark]

08:22 PM on 08/30/2012

Who is rushing to North Dakota to find jobs other than in an oil patch? Perhaps, it's so boring it's like retreating to a cave? That said, you shouldn't have a debt of any kind.

[Blackstone3]

11:17 PM on 08/29/2012

States are in financial trouble. No kidding, who would have thought. I see the usual Democratic lead suspects: CA, NY, NJ (too many years of Dem leadership not to be hopelessly in debt), IL. But TX? omg. Can it be?? Tell me it ain't so Joe, tell me it ain't so.
Liberal blue states can and will continue to spend, spend, spend until they simply cannot borrow anymore. No limit to the NEED they see. No, they will not get (yet) another handout from the broke Federal Government.
One reaps what one sows.

[DingoDango]

12:17 AM on 08/30/2012

Texas has all the ILLEGALS that it has to support.

[Solomon Moon]

01:17 AM on 08/30/2012

you do know that red states are in debt as well?

[Blackstone3]

05:54 AM on 08/30/2012

Yes I do. But we will be able to handle it much better. We are in debt less and we have more responsible governments.

[POV of the other side]

10:16 PM on 08/29/2012

Four of the top five are extremely liberal states.

[chatnuptime1]

12:06 AM on 08/30/2012

Hey this issue is nationwide.. And no plan on either side is doing anything but making things worse. It looks like an avalanch. Once it gets started there is no stopping it.

[Bufflyn]

04:18 AM on 08/30/2012

And so is the lowest, Vermont. The one state where you can legally be married to the same-sex.

[Lona Schuyler]

10:14 PM on 08/29/2012

It appears that the states with the largest populations have the greatest debt. It seems logical that the ratings would turn out that way. I wonder, if a debt per taxpayer ratio were considered, would these states still rank the highest?

[main945]

12:05 AM on 08/30/2012

That's interesting, it's all in how you look at the numbers. So everyone just calm down.

[chatnuptime1]

12:07 AM on 08/30/2012

Considering that the taxes are used on stupid stuff that does not help the people or bolster public reform no.

[Melvin Reed]

08:35 PM on 08/29/2012

Reuters said America's 50 state governments owe $4.19 trillion, including outstanding bonds, unfunded pension commitments and budget gaps, according to a new report. This is the quiet effect of the incredible imbalance between the rich and the poor. The appeal that we are an a united states of America falls on deaf ears. As the states go deeper in debt, so do their citizens. The resulting drop in discretionary spending and cash in circulation is the grounds the GOP is using to declare that President Obama has failed. Thhis crisis has been engineered by a rvery small number of very, very wealthy people intent on getting richer. They are counting on voter suppression and white blue collar workers to make it happen. Anybody home out there? Amen?

[Blackstone3]

11:22 PM on 08/29/2012

We are not in a United States when it comes to state debt: your problem you blue state prolific losers. Vote them pensions. Vote those mandates. Vote those feel good results. Your problem, not mine.
Listen clown, no wealthy people made you blue staters stupid. You did that on your own. Look in a mirror and pay up. I lived in CA (elect them Dems), NY (elect them Dems), and NJ (they finally had enough of outrageous property taxes and elected a Rep, too late, check out those unfunded public pensions, wow!!).
Kiss off, pay your own bills.

[JDShipley]

01:20 AM on 08/30/2012

Property taxes are up 20% in NJ because of the cuts at the state level by Christy. He just shifted the load elsewhere. Unfunded pensions are because of both parties in IL. You forgot to note that the Texas deficit is entirely the work of the keen granite-like mind of Gov. Perry (R) as is the looming crisis in Tea Bagger dominated Kansas. But then red states where the teen pregnancy rates are skyrocketing as education levels dive or, like Mississippi where one fifth can't afford to eat regularly, are veritable nirvana.

[Wisdom and Victory]

07:00 AM on 08/30/2012

The Blue States support the Red states--Red states receive more money from the gubmnt than they pay in taxes. And yet, the Red states still manage to drag along the bottom in literacy rates, education, infant mortality, etc..

[muck-raker]

06:55 AM on 08/30/2012

http://www.commentarymagazine.com/2012/08/06/what-money-will-not-buy-even-for-sheldon-adelson-jonathan-pollard-israel-romney/

[msgirlintn]

07:31 PM on 08/29/2012

Rick Perry's Texas is #3 in the country for having the most debt. That is after he took the stimulus money and paid down his budget deficit instead of creating jobs.

[AZterritory]

09:37 PM on 08/29/2012

Word. Interesting list.

[Cara DePalma]

10:02 AM on 08/30/2012

Great micro-bio!

[Blackstone3]

11:24 PM on 08/29/2012

The stimulus didn't create any jobs. Your line of thinking is why all those blue states are going to be groveling and begging on their knees for a handout. Right, the GOP House is going to float CA. Sure. Grovel away liberal, beg like the dogs you are.
Now someone tell me what happened in TX?????

[msgirlintn]

03:17 AM on 08/30/2012

Blackstone,

Didn't read the article did you?   Keep skipping the article and making comments that aren't true.  It just proves you Fox viewers are less informed than those that watch no news at all.

[msgirlintn]

07:26 PM on 08/29/2012

Seven of the top ten are governed by Republicans.  CA had a Republican governor until 2011.   It's true.  Republicans accumulate more deficit spending than Democrats in state houses and federally.

[damilitant1returns]

08:40 PM on 08/29/2012

I was hoping that someone would do the math. Thanks.

[Blackstone3]

11:26 PM on 08/29/2012

Give it up you whining blue state loser. CA has been run by Dems for two generations. NY for three. IL by one. Only surprise to me is TX. What happened?????????

[DingoDango]

12:19 AM on 08/30/2012

Illegals happened in Texas!

[sfgiants25]

01:25 AM on 08/30/2012

Wait a minute...4 of the last 7 (going back to Ronald Reagan) Governors of California have been Republican. What's that about "been ruled by Democrats for 2 generations" again?