#4: Put the state's financial house in order
The Federal government is in dire financial straits, and we can't count on it not to make dramatic cuts to funding that Iowa requires. The states rely on Federal funding for an average of 29% of their annual budgets.
We are at special peril because we will probably lose a seat in Congress before the next decade is out of diapers, going from five Representatives to four. That could be a serious threat to our fiscal standing in Washington. There are as many members of the House representing metro Atlanta as delegates from the entire state of Iowa. It's reckless of us as a state to count on the Federal government for critical budget needs.
Over-promised liabilities for Medicare and Social Security will drop a hammer on the Federal government's long-term budgets. When push comes to shove, battles over discretionary spending will be fought between state governments seeking public-works assistance and AARP as it lobbies for more government benefits for senior citizens. Other battles will be fought between small states needing loans for infrastructure and large states seeking support for entitlement programs. In each case, the smart money is on the side with the biggest constituency, and in neither case does Iowa emerge victorious.
We have to prepare for a future with fewer votes in Congress and less money in the public till. At the same time, we'll be taking care of more and more retired Iowans who will be putting less money back into the state through their income taxes.
Many small communities have declining revenue bases for property tax collections, making it necessary to raise tax rates, which further aggravates the decline of the revenue base.
We are not high on the radar screens of other parts of the country: Aside from the Presidential caucus season, how often is Iowa even mentioned in the news from Chicago? Almost never; and yet, we're neighbors. North Carolina and Oregon care even less. Attention means funding in Congress, and when you don't get that attention, you have to fight for table scraps at the Federal level.
The state has been borrowing from trust funds for too long and pretending as though it has "balanced" the budget. State Auditor David Vaudt has raised the red flag more than once, but he's a lonely voice in the wilderness. Little has been done.
Future liabilities in the form of state and public employee pensions alone could be huge. But we have immediate expenses, too, in transportation, environmental quality, and health care.
The state's trust funds -- for highways, senior care, and the like -- must be bulletproof, not used to cover for our fiscal irresponsibility from year to year
If the state's existing rainy-day fund isn't enough to carry us through a rough year or two under a 99% spending limit, then it needs to be bigger.
We can achieve much of our needed fiscal responsibility either through personnel cuts or reductions in services, but we also shouldn't overlook the potential of contracting out some government services for private delivery. The Des Moines suburbs haven't gone to the wolves just because their communities have contracted out for garbage pickup.
Many states are severely over-stretched
We are at special peril because we will probably lose a seat in Congress before the next decade is out of diapers, going from five Representatives to four. That could be a serious threat to our fiscal standing in Washington. There are as many members of the House representing metro Atlanta as delegates from the entire state of Iowa. It's reckless of us as a state to count on the Federal government for critical budget needs.
Over-promised liabilities for Medicare and Social Security will drop a hammer on the Federal government's long-term budgets. When push comes to shove, battles over discretionary spending will be fought between state governments seeking public-works assistance and AARP as it lobbies for more government benefits for senior citizens. Other battles will be fought between small states needing loans for infrastructure and large states seeking support for entitlement programs. In each case, the smart money is on the side with the biggest constituency, and in neither case does Iowa emerge victorious.
We have to prepare for a future with fewer votes in Congress and less money in the public till. At the same time, we'll be taking care of more and more retired Iowans who will be putting less money back into the state through their income taxes.
Many small communities have declining revenue bases for property tax collections, making it necessary to raise tax rates, which further aggravates the decline of the revenue base.
We are not high on the radar screens of other parts of the country: Aside from the Presidential caucus season, how often is Iowa even mentioned in the news from Chicago? Almost never; and yet, we're neighbors. North Carolina and Oregon care even less. Attention means funding in Congress, and when you don't get that attention, you have to fight for table scraps at the Federal level.
The state has been borrowing from trust funds for too long and pretending as though it has "balanced" the budget. State Auditor David Vaudt has raised the red flag more than once, but he's a lonely voice in the wilderness. Little has been done.
Future liabilities in the form of state and public employee pensions alone could be huge. But we have immediate expenses, too, in transportation, environmental quality, and health care.
The state's trust funds -- for highways, senior care, and the like -- must be bulletproof, not used to cover for our fiscal irresponsibility from year to year
If the state's existing rainy-day fund isn't enough to carry us through a rough year or two under a 99% spending limit, then it needs to be bigger.
We can achieve much of our needed fiscal responsibility either through personnel cuts or reductions in services, but we also shouldn't overlook the potential of contracting out some government services for private delivery. The Des Moines suburbs haven't gone to the wolves just because their communities have contracted out for garbage pickup.
Many states are severely over-stretched
- What government should do:
- What individuals should do:
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