Excellent chart from Barry Ritholtz’s The Big Picture. He uses data from the Federal Reserve’s Flow of Funds Accounts to map credit flows. State and local governments have become negative borrowers in the first quarter as the amount of bonds that have matured and the amount of principal that has been repaid exceeded new bond issuance. States and municipalities are making the hard fiscal choices and restraining borrowing and expenditures. It’s painful, but it must be done.
Taxes are the fuel for the government. Without taxation the state withers. Our governments have taken on so many responsibilities but have become starved for fuel. There is much debate on how much we as a country should spend on entitlements and defense, but often these arguments are made on the premise that the United States has higher taxes than other nations.
California needs to extend tax increases to balance budget
These are hot times in Sacramento. California’s constitution requires the legislature to send a budget to the governor by June 15. Time is running out to patch up an agreement, and there is a new incentive for lawmakers to get it done. From Bloomberg:
CA Treasurer launches another derivatives investigation
We often see Wall Street selling sophisticated products to state and local governments which are not appropriate for them — think interest rate swaps and Jefferson County. So it’s always refreshing to find a government official who actually tries to keep Wall Street in line.
A post-Memorial day salute to all who have served our nation!
Grand Rapids shakes her booty
In Michigan, the decline of the U.S. auto industry has shrunk many cities. In January Newsweek highlighted the decline of American cities and identified Grand Rapids as a city on a downward spiral. Grand Rapids has fought back, producing the video above to show the vitality of their city. Good on you Grand Rapids. Your sense of caring and community shines through. (H/T CuriousityCounts.com)
The Congressional Budget Office has published a new report entitled “Estimated Impact of the American Recovery and Reinvestment Act on Employment and Economic Output from January 2011 Through March 2011.” It makes some large claims about how many jobs stimulus funds have created:
Attention Muniland! Do you have an idea for a public web or mobile application? Change.org is sponsoring a Hack for Change on June 18th and 19th and is soliciting ideas for their programming competition. Here are some of the ideas that have already been posted: