Borrowing from Peter to Pay...Peter

The Wall Street Journal is reporting that the US Treasury is making $25 Billion in "recovery bonds" available to the states as part of the economic stimulus package Congress passed earlier this year.  So the US government is borrowing money in the name of future taxpayers to cover State spending that current taxpayers are not willing to finance.  It would be one thing if this were simple one-for-one exchange, but it isn't.  It is a special subsidy for the states who can't keep their financial affairs in order (California, Michigan, New York) paid for by the states who can (Texas, Florida, and others).  What is so outrageous about this is that Texas and Florida manage to keep their budgets balanced on a much lower tax burden than California and New York, who can't keep their budgets balanced.  It is more or less the federal government stepping in and equalizing the effective taxes paid by the citizens of all states, destroying our federalist system and usurping the power and autonomy of the states.  If the Union is to survive, it will require ending these perverse policies.

Posted via email from skinnerlayne's posterous