subject: Nothing in Life is Certain but Debt and Taxes [print this page] Nothing in Life is Certain but Debt and Taxes
**DISCLAIMER: THE SITUATIONS AND NUMBERS USED HEREIN ARE COMPLETELY HYPOTHETICAL AND FICTIONAL.
With such an alarming amount of debt for one small state, something drastic has to be done. Imagine that you and your spouse owed over $100,000 on your credit cards, plus a $200,000 mortgage, plus two car payments worth around $75,000, plus the cost of your day-in day-out lifestyle. Even if your household income is $125,000 annually, you'll never be able to get out from under your debt. Although you can comfortably make the minimum payments and have the things you like. But is that really helping you get out of debt? Is it going to blow up in your face in the end?
It's important for everyone to maintain not only daily and monthly budgets, ensuring that there will be money for bills and groceries, but also long-term budgetary planning otherwise you'll never really own anything, never retire, never get out from under it all. After all, those minimum payments towards unsecured debts (credit cards, personal loans, etc.) pretty much only cover fees and interest. That's why to pay off a $2,000 credit card, you'll often end up spending well over $10,000 to see the balance completely removed. Now just imagine all of this debt on a state scale.
Unlike the average individual, the state has the option to increase its income. No individual in the world just wakes up one day and says, "I'm going to double what I make today." It simply doesn't work like that. In order for the individual to pay off their credit cards and other debts owed, maybe it means not getting season tickets to the UConn basketball games or cancelling those February cruises from Miami to Nassau. States don't maintain lifestyles to cut. If anything gets taken away, the citizens are the ones that lose. Fire and police departments, libraries, schools, roads, sanitation, etc. are the cutbacks that the state has to make not expensive bottles of scotch and 18-holes twice a week with Bob from down the street. This is why tax increases are simply not an option.
Of course, citizens can enroll in various credit card debt relief programs to help right the proverbial financial ship, but far too many people take advantage of wiping away their unsecured debt. And even if they can handle that, the problem of mortgage principle and car-notes still persists. So does that person file bankruptcy? Wash their hands of their debt and just move on? Sure, if they reach a point of insolvency and have absolutely no chance of ever rectifying the situation they face. Otherwise, no, that's absurd. Life simply doesn't work that way. States are in the same boat.
The next time you start to complain about tax increases, take a look at your own life. Budgeting and campaigning are reflexive evils that your state legislatures are forced to balance. Don't be mad at them for trying to keep up with the Jones's.
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