Tuesday, June 21, 2011

Chicago - Funds $108 Billion In the Hole

Tell me again how great Chicago is -
The average Chicago household now owes a staggering $63,525 to cover local government debt, according to Cook County Treasurer Maria Pappas.

Suburbanites are deeply in the red, too, with the average household owing $32,901, according to the treasurer.

Among the biggest reasons: $25 billion in unfunded pension liability.

In comments after an appearance Tuesday before the Civic Federation, a watchdog group that has released somewhat similar numbers in recent years, Ms. Pappas said she was "stunned" to learn that county taxpayers on the whole owe more than $108 billion toward local debt.
Now why oh why would you be "stunned" to hear the debt numbers? Simply, because very few knew and in order to get the info, the government HAD TO BE FORCED -
The figures were derived from a recently passed debt disclosure law. Ms. Pappas said the numbers have never before been compiled in this fashion.

"This goes well beyond big cities," she said. "These fiscal problems permeate townships, villages, school districts, park districts, fire protection districts and more, and the taxpayers are on the hook."
The Real Effect
So, what can we garner from this little revelation? For starters:
  • Do not confuse people with government. They are not the same.
  • Government WILL lie to you as a matter of practice. They just come up with sophisticated ways to do so.
  • They will attempt to hide damaging data as often as possible, it's in their own interest to do so.
  • The debt situation is SIGNIFICANTLY worse then most governments are letting on. (They're afraid of the pitchforks)
  • The bigger the government, the bigger the potential problem.
  • The real problem will not be corrected until someone forces governments hand.
  • The bureaucrats will pass the bill AND the blame onto you. (After all, you voted for it)
Think this through for a second, do you really believe that the average Chicagoan got $63,525 in services? Or is it more likely that this money was squandered and then in TARP fashion the bill was passed to the taxpayers? Who is going to pay for this? (And make no mistake someone will pay for it.) Taxpayers? Pensioners? Bondholders? Banks? The Chinese?

Let's take this just a tad further here. Pretend for a second you hired an individual to manage your finances. In turn, he would arrange schooling, water, police services, and a few other important items for you and your family of 4. Naturally, you would expect a bill. When that day comes, it says 50% on it... Not $10, not $500, but 50% of your $120,000. Outraged, you demand an explanation. What does it matter how much money you make you demand to know. I want to know how much you are charging. At this point, the individual feigns fear and arranges for the police that you paid for to arrest you and take you to jail for bill avoidance. 10 years later when you get out, you get a bill for not only his services, but your jail upkeep and food and just to rub it in - another bill for $250,000. His "debt" that you supposedly owe.

As crazy as that seems, that is how we run our finances via government.

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