- State governments face combined debt of more than $4trillion
- When broken down to a per capita basis, every American – including babies born each day – owes an average of $13,425
By Graham Smith
PUBLISHED:07:55 EST, 3 October 2012| UPDATED:07:56 EST, 3 October 2012
The true scale of America’s financial crisis has been exposed after it was revealed that every man, woman and child in the country owes more than $13,000 in state debt.
Researchers found that state governments face a combined debt of more than $4trillion.
When broken down to a per capita basis, this means that every American – including babies born each day – owes $13,425.
For private sector workers, who are at increased risk and shoulder much of the state tax burden, that figure increases to an eye-watering $37,486 per person.
The figures were published yesterday by State Budget Solutions, a nonpartisan organisation pushing for state budget reform.
Bob Williams, president of State Budget Solutions, said that the aim of the study is to highlight how much state debt is costing each resident.
The report calculates total state debt per capita, per private sector employee, and as a percentage of private sector gross state product.
In each of the three categories, Hawaii, New Jersey, and Alaska are among states with the five largest debt figures.
At the other end of the spectrum, Nebraska has the lowest total in each of the areas.
STATES WITH THE LARGEST PER CAPITA DEBT
- Alaska – $31,141
- New Jersey – $29,252
- Hawaii – $29,062
- Connecticut – $27,540
- Illinois – $21,067
- Ohio – $20,749
- Rhode Island – $17,993
- New Mexico – $16,895
- California – $16,386
- Delaware – $16,012
The largest per capita debt figure for all 50 states is Alaska, where each person’s share of state debt stands at $31,141.
New Jersey, Hawaii, Connecticut, and Illinois make up the top five states with the highest per capita share of the state debt.
Nebraska, on the other hand, has the lowest total debt per capita at just $4,249 for each resident. Tennessee, Indiana, Florida, and Idaho round out the lowest five debt levels per capita.
Private sector workers are at increased risk as they are the ultimate tax base for reducing state debt.
Using figures from the U.S. Bureau of Labor Statistics, State Budget Solutions determined that Hawaii has the largest debt per private sector worker at $83,815, followed by Alaska, New Jersey, Connecticut, and New Mexico.
Nebraska again has the lowest total, with $9,829 in debt for each private sector employee. Indiana, Tennessee, North Dakota, and South Dakota follow.
State Budget Solutions also calculated state debt as a percentage of private sector gross state product (GSP). Hawaii’s debt stands at 79.21 per cent of its entire private sector GSP, the highest percentage of the 50 states.
New Jersey is again right behind with its debt representing 59.69 per cent of private sector GSP. Ohio, New Mexico, and Alaska constitute the rest of the top five.
Nebraska, Tennessee, Indiana, North Dakota, and Virginia have the lowest debts as a percentage of private GSP.
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