There are now over 2 million Illinoisans dependent on food stamps, and more than 1 million in Cook County alone. That means that one in five residents of Cook County depend on food stamps just to get by.
Category / bonds
Indianapolis Still Paying Off RCA Dome Debt
In 1984 the RCA Dome opened for business its primary tenant was the Indianapolis Colts. The total cost to complete the RCA Dome was $77.5 Million($176.5 Million in present day inflation adjusted pricing). The cost was financed by the taxpayers of Indianapolis($47.2 million worth of bonds) and The Lilly Endowment/The Krannert Charitable Trust($30 Million). In 2006 the city undertook building a new stadium where the Colts presently play today. In 2006 the total outstanding debt on principal still stood at $75 Million and scheduled to be paid off by 2021. Before 2006, the actual debt was supposed to be paid off by 2013, but through refinancing of bonds, it jumped to 2021.
The city of Indianapolis does its best to make access in researching debt it owes on things tedious to find. The most current numbers I could find were published in 2010 showing RCA Dome debt standing at $61 Million. With eleven years of payments left comes to about $5.5 Million in annual payments on an already demolished structure.
Investors make a lot of money off local governments through time in financing these short term adventures that politicians want. Lucas Oil Stadium where the Colts presently play was built for $700 Million along with their new $275 Million Convention Center. This was financed over thirty years and once interest/financing charges are factored in, the combined project will cost taxpayers about $1.8 billion.
Updated Federal Government Deficit & Debt
Washington DC political reporter Jamie Dupree released the current financials of the Untied States Government:
Budget deficit in August was $128.7 billion; total deficit so far this fiscal year is $589 billion
Current government debt is
$17,764,720,406,589.08
United States YTD Interest on Debt Payments
Month of August Interest on Debt payment was $27,093,517,258.24. Fiscal YTD payments now stand at $411,217,855,816.94. There is one fiscal month left for 2014.
Soure: Twitter page @USGovtInterest
Numbers from Illinois Teachers Pension Fund
Illinois is a broke state and their teacher pension fund does not make things any easier on how it is contractually written. Yes, it is a contract and the state is honoring the pension as of right now. In the spirit of “States Rights” the voters of Illinois find their financial situation very pallable no matter the current conditions or what they will be facing as the physics of economics plays out. This blog is not making fun of Illinois but it also will not give pity to the residents when debt hell hits.
The Washington Times had a long article showing the ramifacations of this current penson plan that they operate on. I will post the key financial highlights of it while you can read the rest in the embedded link.
About 6,000 retired educators collecting more than $100,000
More than 100,000 retired Illinois educators had been paid back what they invested into the system just 20 months after leaving work
The pension is about $54 billion underfunded
The teacher pension’s 3 percent annual increases aren’t tied to inflation — meaning they cannot fluctuate up or down depending on the economy or budget pressures.
Illinois public sector workers will receive, on average, a $1,906 annual cost of living adjustment this year — nine times more than the average Social Security beneficiary
Housing Market Will Be Very Slow Next Decade
I’ve been seeing some house sales numbers popping up as of late but haven’t really dug into them. This post I’m writing is because I stumbled upon a claim, looked it up and found a trend that maybe reversing……How long Americans stay in their homes they buy. While reading an article from Dave Ramsey on “Homebuyer Mistakes” he had this in the article:
Homeowners stay in their homes an average of just four years, according to the National Association of Realtors.
I found this to be very intriguing and wanted to dig more into this number. First article I found (Longtime Homeowners a Relative Rarity in U. S., Census Shows) dated November 21, 2003. Seems to back up the claim of short ownership of a home.
Although a relative rarity in the United States, where homeowners stay in their homes an average of six years, according to the National Association of Realtors
Now a more recent article I found (Downside of low US mortgage rates? Less selling) written in July of this year shows homeownership economic factors pertaining to the effects of low interest rates caused by in fashion by the Federal Reserve. Shows why the housing market will be very slow the next decade.
More than one-third of homes with a mortgage now have rates below 4 percent, real estate data provider CoreLogic estimates….. As a result, many homeowners with low rates are staying put. Others are moving and buying new homes, but keeping their old ones and renting them. The number of available homes last year was the equivalent of just 4.9 months’ worth of sales, according to the National Association of Realtors.
The big problem of people not being be able to sell is equity issues…..
Another factor is that almost 40 percent of homeowners still don’t have enough equity to enable them to sell. Some are “underwater,” with a mortgage higher than the home’s value. Others may have so little equity that they can’t afford to pay off the sales costs and put a down payment on their next property.
One final note on top of this, many investors and Americans expect interest rates to rise significantly over the next few years. This will be a big pressure on home sales along with the above mentioned.
Indiana Hoosier Lottery Financial Release
Via Indiana Hoosier Lottery –
Hoosier Lottery officials announced Tuesday that the Lottery is providing the State of Indiana with more than $250 million in surplus revenue for fiscal year 2014.
The State uses the contributions to support the Build Indiana Fund, pensions for local firefighters and police officers and retirement funds for Indiana teachers.The $250 million in surplus revenue for fiscal year 2014 is a 12 percent increase from $224 million in fiscal year 2013. Although final audited figures will not be available until later this year, preliminary totals show sales were $1.018 billion for fiscal year 2014.
The rest of the article is here
Census Bureau: 109 Million on Welfare
The Census Bureau released their fourth quarter 2012 results and found 35.4% of all Americans to be receiving welfare. Here is more from a lengthy CNSNews Report.
109,631,000 Americans lived in households that received benefits from one or more federally funded “means-tested programs” — also known as welfare
The number jumps when other programs are added in:
When those receiving benefits from non-means-tested federal programs — such as Social Security, Medicare, unemployment and veterans benefits — were added to those taking welfare benefits, it turned out that 153,323,000 people were getting federal benefits of some type at the end of 2012.
Here is a breakdown of what welfare program is received by Americans and how many on it:
82,679,000 Medicaid
51,471,000 Food stamps
22,526,000 Women, Infants and Children program
20,355,000 Supplemental Security Income
13,267,000 lived in public housing or got housing subsidies
5,442,000 got Temporary Assistance to Needy Families
4,517,000 received other forms of federal cash assistance.
Social Security Disability Insurance Fund Will Be Depleted in 2016
Charles Blahous of the Manhattan Institutue recently reported on some findings from the July 28th Social Security Trustees annual report. Social Security and Medicare are two government programs that have been long embedded in government spending. These programs are political hot topics whenever they are suggested to be “reformed” or made more efficient, political dogma ensues. Changes for the most part of these programs are made to give MORE benefits to people and not a regression. I will take some information from Mr. Blahous write up which he did testify in front of Congress about and then turn to two other sources for completion of this summary.
The public must understand the breakdown of how Social Security functions when pertaining to funds
Social Security has two trust funds. Payments for retired workers as well as spouses, children and survivors are made from the Old-Age and Survivors (OASI) trust fund. Payments for disabled workers and their dependents are made from the Disability Insurance (DI) trust fund. It has become commonplace to refer to the two trust funds’ combined operations as though they were one fund. This nomenclature is convenient but not truly accurate. By law each of the two trust funds must separately have a positive balance to allow them to make benefit payments.
Here is big point for people to grasp about this trust fund. Many people who support Social Security at any cost claim the program has too by “law” go on forever no matter what funding issues arise. That is true to a point and here is that BIG point. Once funding for the SS Disability Insurance fund starts going in the red, payments can be greatly reduced “BY LAW”.
The trustees have been warning for several years (long before I became one) that Social Security is on an unsustainable financial trajectory. We have now moved from a long-term problem to an immediate one. The DI trust fund is currently projected to be depleted in two years, in the fourth quarter of 2016. At that point, unless the law is changed disability payments will drop suddenly by 19 percent.
I would suggest reading Charles Blahous article (A Guide to the 2014 Social Security Trustees Report) a few times and even take some time to ponder it. It is a very nice write up and one to keep on file for further events.
Social Security and Medicare produce reports and the federal government then puts together a summary(Status of the Social Security and Medicare Programs) of these two reports. Here are some highlights of the summary pertaining to just Social Security.
Neither Medicare nor Social Security can sustain projected long-run pro- gram costs in full under currently scheduled financing
Social Security and Medicare together accounted for 41 percent of Federal expenditures in fiscal year 2013
The Trustees project that this annual cash-flow deficit will average about $77 billion between 2014 and 2018 before rising steeply as income growth slows to its sustainable trend rate after the economic recovery is complete while the number of beneficiaries continues to grow at a substantially faster rate than the number of covered workers.
In October 2013, “60 Minutes” reporter Steve Kroft did a segment called “Disability, USA”. If you have not seen it, I suggest you take a look at the SS disability situation happening in America.
Final summation: For years many Austrian Economic students have talked about the Social Security situation. They are usually met with resistance by economic pundits who produce wild and complicated graphs that say everything is o.k. Problem with this belief is it defies reality. Real money is being given to real people. This program has real issues that cannot be delayed as the physics of debt take over.
Year To Date Federal Government Deficit $460 Billion
The United States Treasury just released up to date tax revenue collection relating to 2014 fiscal government budget. 2014 government budget ends in September.
CSN News provides a more detailed analysis:
Inflation-adjusted federal tax revenues hit a record $2,469,178,000,000 for the first 10 months of the fiscal year this July, but the federal government still ran a $460,450,000,000 deficit during that time, according to the Monthly Treasury Statement.
After the current fiscal year, the second highest federal tax intake in the first 10 months of a fiscal year occurred in the first 10 months of fiscal 2007, when the government collected $2,432,115,460,000 in 2014 dollars – or $37,062,540,000 less than in the first 10 months of this fiscal year.
The total dollar amount already spent by the government stands at $2,929,628,000,000.
You can read the rest of the article here.
Hoosier Econ 