Laissez le bon temps rouler

Asking the difference between Illinois and Venezuela is soon to reach the same point on the economic map. While we are considering this pair, forget not Puerto Rico, another glorious example in Socialism successes. But the former two are the real stars, paragons of the terminal condition of any Socialist construct. We believe you know about Venezuela, probably heard about Puerto Rico so lets concentrate on Illinois.

Illinois in danger of entering financial ‘death spiral’

Illinois’ budget crisis has become so dire that the state is in danger of entering a financial “death spiral,” as a prominent ratings agency threatens to downgrade the state’s credit score to “junk” status.
Doing so would increase the cost of borrowing, worsening the deficit and making it even harder for taxpayers to dig out of the hole.

“We’re in a death spiral—Illinois has the worst pension crisis in the nation and needs the boldest reforms,” Ted Dabrowski, Illinois Policy Institute’s vice president of policy, told Fox News. “There is no doubt that junk bond rating is on its way.”

S&P Global Ratings has warned the agency will likely lower Illinois’ credit rating to below investment grade if feuding lawmakers fail to agree on a state budget for a third straight year.

Lawmakers are now in a special session in an effort to break the budget impasse, prodded by Republican Gov. Bruce Rauner, who has referred to his state as a “banana republic.”

The state currently faces $130 billion in unfunded pension obligations and a backlog of unpaid bills worth $15 billion. A downgrade to “junk” status would increase the cost of borrowing for critical infrastructure, or refinancing existing debt. [snip]

Through all this the Dems won’t agree to cap spending and cut programs that cannot be funded. What programs would those be? How about schools closing for starters, then no road repairs and state property maintenance.

Many taxpayers fled the state over the past half decade followed by businesses looking to avoid the onerous taxes. The current situation isn’t going to improve in the future not with a S&P downgrade of the bonds.

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