So, what should the state do with that surplus? Given the nearly $40 billion state debt (23.5% of gross state product), a rational individual might think that the incentive might be to use the surplus to pay down the debt just a little--and it would be by just a little $110 million is a mere 0.275% of our state debt. What are our politicians planning to do with the surplus instead? Eliminate it, of course! How? As should be expected according to public choice theory, our politicians, in an effort to satisfy the politically organized, are going to give tax breaks to businesses who have argued that they have been over-burdened by the increased taxes to pay back the federal loans received to keep unemployment benefits flowing back in 2009.
The unfortunate reality is that the only legitimate way to get out of this problem of excessive federal and state debt is to cut spending and over-burden current tax-payers to pay off the federal and state loans taken out in the past to provide excessive benefits to past voters. We MUST run surpluses, not just balance the budget. I don't want to bear that cost, but we are past that now. It is wrong to further burden future generations with greater tax burden. This level of spending without taxation is not sustainable. The longer we put off the correction, the more painful that correction gets.
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