The spreading impact of the current economic mess
As believers we must force ourselves to understand a few things about what is going on in the world. The Bible urges us to NOT be ignorant of the enemy's devises. Please read the following from the perspective of being a smart believer able to avoid pitfalls and capable of helping others also.
As if there are not enough things to be very concerned about when looking at the current and future state of the economy; new data indicates trouble brewing in places no one thinks about. There is, according to the Center on Budget and Policy Priorities, a very real and present danger that 46 of 50 states in this union may have to declare bankruptcy within the next 18 months.
I beseech anyone genuinely interested in the scope of the current crisis to spend a little time and look at the data presented on this site. There is a lot of numbers, but in this case the numbers don't lie.
http://www.cbpp.org/9-8-08sfp.htm
There are many states facing huge budget shortfalls this current fiscal year, but near the bottom of the above linked article, one sees where the real problems lie and that is next year with the 2010 state budgets. One of the more sobering lines in this article was:
"Unlike the federal government, states cannot run deficits when the economy turns down; they must cut expenditures, raise taxes, or draw down reserve funds to balance their budgets. As a new fiscal year begins in most states, budget difficulties are leading some 39 states to reduce services to their residents, including some of their most vulnerable families and individuals."
Just a few days ago, the mayor of New York City, Michael Bloomberg announced cuts in services, job cuts and raises in fees to try and close the current 4 billion dollar gap in the budget. While many of these things may seem trivial to those living outside of New York, for residents of our country's biggest city and especially its employees-this is a HUGE deal.
http://wcbstv.com/breakingnewsalerts/nyc.budget.mayor.2.921808.html
When one considers the current expected budget gap in California is nearly 15 billion dollars, and that it is well documented that the state will be totally out of money and the means to borrow money by the end of this month; it doesn't take a genius to figure out what is in the cards. The United States Government has to ride in on its white horse and bail out the states to keep them from all declaring chapter nine bankruptcy. Look for gigantic outlays of Federal dollars to keep the states afloat.
The truly scary part of this whole thing is trying to figure out where it will ever end. I was speaking the other day with a local attorney who is "taking care" of my ticket for supposedly running the red light awhile back. He said in our little town of just under 5,000 the revenue has dropped so dramatically that the police department has standing orders to ticket everyone for every possible infraction. He said the city police managed to issue over 2,500 citations for running red lights or stop signs last year. They are truly desperate for revenue.
Rumor has it that the county is going to RAISE property taxes this fall to make up the shortage in revenue. My insurance agent says all the major insurance companies are broke and either must dramatically raise rates or demand deductibles go up to around $2,500 for the average homeowner's policy. Everywhere we are seeing places RAISING PRICES, FEES and TAXES trying to get back the revenue lost in the current depression.
What is the worst thing to do during an economic downturn? It is to raise prices and taxes, yet that is what everyone is doing. The banks are losing money so they raise interest rates and fees to bring money back into their business. The more places raise fees, prices and taxes; the more people will collapse under the burden of being unable to afford them.
Perhaps the most troublesome part of this whole thing is where the states are looking to cut expenses. The biggest part of most state government's budgets is education. The number one place most states are cutting expenditures is-education. Up next are various services for the elderly, disabled and chronically poor. To read more, please look at the following articles:
http://www.cbpp.org/12-17-08sfp.htm
http://www.cbpp.org/3-13-08sfp.htm
Logically if the states are in the kind of trouble mentioned by these articles, then the counties and cities must be in even worse shape. I know that locally we hear every day of more and more cuts being proposed in basic services such as law enforcement and the like. It is truly very dangerous ground to be on when advocating cutting back on police officers in a city such as St. Louis which already has one of the highest crime rates in the nation.
If the unemployment rate does hit 10% in the next few months (and I think it will go much higher), the resulting lack of money flowing into the economy along with the need for government to provide unemployment, Medicaid, food stamps and other programs will result in ever growing deficits at all levels of government. The problem is truly startling in its scope and dimension.
I have no clue what a state such as California is going to do. Already they have halted tax refund checks and dramatically cut back on many services. Even with these moves, their deficit grows greater day by day. I have no idea what cities such as New York are going to do with the dramatic loss of revenue and the need to fund the potpourri of various programs the citizens have grown accustomed to and dependent upon.
I don't have a clue how a household such as mine will survive the next few months. I looked at my wife's 401k and it lost another 30% of its value since September. It is now worth less than half of what it was worth just last summer. Our Roth IRA's have lost close to 60% of their value and our home is now only worth 70% of what it was worth a year ago. These are steep drops in a household's net worth. Meanwhile, it seems that everyone wants to raise prices, fees and taxes to bridge their budget gaps.
These are times not to be afraid but to we aware of just how deep the problems are which afflict us. Of course we believe and trust God will take care of us, but He only can if we are not ignorant of the ways and means by which the enemy is attacking. Ignorance breeds either false confidence or fear, neither of which is good. A little knowledge will go a long way in allowing us to be prepared for what is coming and confident in our Lord's promises to provide.
It is time for all of us, regardless of our denominational beliefs, to understand just how dire the current economic situation is in this world, country, state and city where we live. Soon, and I mean very soon, the cries of millions of people will be heard as one by one people lose their jobs, then their health insurance, then their homes and finally their dignity. Soon, I truly fear that the majority of Americans who currently still think all is well with their finances will receive a jolt that forces them to realize how close we are the end of this country as it has been known for centuries.
Barring an unexpected acceptance of Rush Limbaugh's stimulus package (dramatically cutting Corporate taxes and eliminating the capital gains tax for one year), all the pork laden legislation currently working its way through Congress is going to do is make things worse. Please, pray as you never have before that reason rules somewhere in government and that God provides a way for His people to endure regardless of what transpires in the days and weeks ahead.
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Author: blessings2you
Location: Warrenton Missouri USA
Gender: Male
Age: 57
Blog Entries: 822 (archive)
Blog Comments: 4
god called me to serve him when i was 16 years old while on a church work trip in new mexico in 1969. in the 40 years since; i attended bible school/leadership training, been ordained to the christian ministry and worked full time for a non-denominational ministry for nearly ten...
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in 1969 god stepped in and transformed my life as a sixteen year old teenager. after a couple of years of intense emotional ups and downs, i decided i needed a firm foundation in my life that went beyond emotional experiences. it was the decision to become involved with a...
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