It looks like the exodus of tax payers from New York is taking its toll on the state’s budget and ability to stay solvent. Tax and fee hikes to fund lavish social programs are the number one reason people have been leaving New York for greener pastures for years (myself included) and now the Empire State has reached the point where they have more people and projects collecting revenue than paying it in.
NEW YORK (Reuters) – New York state’s general fund has had a negative cash balance every day since September 3, a problem that “underscores the tremendous amount of risk” in the state’s budget, Comptroller Thomas DiNapoli said on Thursday.
Though New York ended August with a nearly $528 million of cash in the general fund, which counts state tax and fee revenue but excludes federal dollars, it was forced to delay paying billions of dollars of bills that were due last month.
“Restoring the General Fund to a positive balance will depend on whether the state brings in enough revenue in the second half of the month,” said DiNapoli in a statement.
Which won’t happen as more and more Northeasterners flee to the south looking for tax relief and lower costs of living.
Reuters doesn’t see it that way though, claiming that New York is flush with money. Surprisingly (to some) the left leaning reporters blame the state’s whole financial problem on one thing – Medicaid:
The general fund paid out $20.9 billion — about 5.4 percent more than a year-ago, mainly because of an extra billion dollars needed for Medicaid. The state-federal health plan for the poor cost more this fiscal year because claims rose, a payment was delayed from the previous budget and claims climbed.
Still, there were declines in spending on health and the environment, which dropped $463 million, and other social services, which fell $335 million.
Unspoken in this of course is the MSM’s unshaken belief that Obamacare will lower these costs. That’s of course non-sense but they’ll find that out soon enough.
The real issue here is two-fold. Firstly New York has been warned that they were going to hit this wall for years and continued, under the leadership of both Democrats and Republicans and (with assists by the Green Party, Conservative party and the Libertarians) to build a massive entitlement state that is teetering on collapse. This will lead to civil unrest as up to 50-60% of that states population is completely reliant on some government subsidy to maintain their lifestyles.
The second issue is that the media sat on this information, which they knew as soon as it happened, for weeks. Why?
Civil unrest. It’s coming and the catalyst for riots in the big cities will be welfare recipients getting cut off. The government is desperately trying to hang on until the “recovery” fixes things, but that’s not going to happen. The complicit media is trying to keep the remaining New Yorkers, most of whom are the people whose care and feeding drove the productive out, from learning the bitter truth – it’s over.
But they can only hide that fact for so long. When the general public realizes that the golden years of government giving non-workers middle class lifestyles are over all hell will break loose.