{"id":10819,"date":"2015-08-07T07:49:36","date_gmt":"2015-08-07T12:49:36","guid":{"rendered":"http:\/\/olduvai.ca\/?p=10819"},"modified":"2015-08-07T07:49:36","modified_gmt":"2015-08-07T12:49:36","slug":"heres-the-next-crisis-nobody-saw-coming","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=10819","title":{"rendered":"Here’s the Next Crisis “Nobody Saw Coming”"},"content":{"rendered":"

Here’s the Next Crisis “Nobody Saw Coming”<\/a><\/h3>\n

When borrowing become prohibitive (or impossible) and raising taxes no longer generates more revenues, state and local governments will have to cut expenditures.<\/i><\/p>\n

Strangely enough, every easily foreseeable financial crisis is presented in the mainstream media as one that “nobody saw coming.”<\/b>\u00a0No doubt the crisis visible in these three charts will also fall into the “nobody saw it coming” category.<\/p>\n

Take a look at this chart of state and local government debt<\/b>. As we noted yesterday, nominal GDP rose about 77% since 2000.\u00a0So state and local debt rose at double the rate of GDP.<\/b>\u00a0That is the definition of an unsustainable trend.<\/p>\n

\"\"<\/p>\n

As noted earlier in the week, state and local taxes have soared 75%. While this would be no big deal if wages and salaries had risen by 75% in the same time frame, but earnings have barely kept pace with inflation (38% since 2000).<\/p>\n

So state and local taxes have risen at a rate twice that of wages\/salaries.<\/b>\u00a0State and local governments can keep raising taxes, but where’s the money going to come from?<\/p>\n

\"\"<\/p>\n

State and local government expenditures have risen faster than inflation or GDP.<\/b><\/p>\n

 <\/p>\n

…click on the above link to read the rest of the article…<\/p>\n","protected":false},"excerpt":{"rendered":"

Here’s the Next Crisis “Nobody Saw Coming” When borrowing become prohibitive (or impossible) and raising taxes no longer generates more revenues, state and local governments will have to cut expenditures. Strangely enough, every easily foreseeable financial crisis is presented in the mainstream media as one that “nobody saw coming.”\u00a0No doubt the crisis visible in these […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[127,181,353,7922,4924,783,6909],"class_list":["post-10819","post","type-post","status-publish","format-standard","hentry","category-economics","tag-charles-hugh-smith","tag-crisis","tag-gdp","tag-government-revenue","tag-oftwominds","tag-taxes","tag-unsustainable-debt"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/10819","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=10819"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/10819\/revisions"}],"predecessor-version":[{"id":10820,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/10819\/revisions\/10820"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=10819"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=10819"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=10819"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}